Brands from India are getting more visible on the world map, tapping international markets and expanding their customer base. A walk into a convenience store abroad may throw up choices like Clinique and WOW Skin Science, or Twinings and Vahdam.

So, what gives a brand the push to enter global markets? As per Bharat Bhalla, Founder of Yu Foods, “The most critical factor is product differentiation and how the brand stands apart from other domestic and international players. This could be in terms of product innovation, brand attributes, cuisine or pricing.”

Establishing a robust distribution network and securing ample financial resources are also fundamental, shared WOW Skin Science Founder Manish Chowdhary.

As per D2C Insider’s Co-founder Kshitij Ladia it is essential to cater to categories that are ethnic to India. Brands like Vahdam and The Ayurveda Experience were successful in foreign markets because they were built on this Indian phenomena.

“A brand, which is extremely successful in the US, might not be very successful in the Middle East or Southeast Asia,” he pointed out.

In 2022, there were an estimated 2,000 D2C brands in India doing business worth $12 billion.

However, is setting shop on foreign soils as easy as it seems on Amazon and Etsy? Industry experts shared the challenges that brands confront.

The right distributor

“Finding the right local partner for marketing and distribution is often a key challenge for brands looking to enter global markets,” Bhalla shared.

Chowdhary added, “Finding a reliable distribution partner with expertise in FMCG distribution was a hurdle. The brand invested time in scrutinising potential partners, ensuring alignment with their product category and functional proficiency.”

Ladia highlighted that Amazon had made it way easier for brands in India to be able to sell abroad with their infrastructure, but figuring out the right offline distributor all by yourself plays the most important role.

Cultural adaptation

The factor of cultural differences demands thorough research and flexibility to tailor products and marketing strategies according to diverse preferences.

Yu Foods’ Butter Chicken Cup Noodles have worked well in the African market due to the population’s developed tastes. “Consumption patterns and purchase behaviours tend to differ across markets. We have noticed that consumption of instant foods is certainly higher in some of the more developed markets across the world compared to India,” Bhalla said.

For example in India, be it shampoos or sauces, large packaging works more since we are a price-conscious market, added Ladia. But this may not be the same for other markets.

Global origin brands understand this better. McDonald’s understood this way back in the 90s and had a separate team for vegetarian and non-vegetarian orders. Further, they also curated a ‘no-beef, no-pork’ menu, replacing it with Mc Aloo Tikki.

Even Pizza Hut opened its first vegetarian restaurant in Ahmedabad back in 1999, a state with a large Jain population. Not only did the outlet serve no meat, it also offered a selection of Jain toppings.

Regulatory compliance

Many D2C brands struggle due to a lack of knowledge about the legal requirements in foreign markets. Even if they do, the substantial fees charged by consultants who assist with compliance, trademark registration, logistics, and other aspects can be a major obstacle, according to Meera Iyer, Co-founder of SkinQ.

Logistics and inventory management

Managing logistics across borders, synchronising production, inventory, and distribution networks across time zones, posed a logistical challenge for WOW, as per reports.

Other factors like building brand awareness, intense market competition, identifying the main trade channels for FMCG and devising a comprehensive Go-To-Market (GTM) strategy were some other factors that pose as hurdles.

Additionally, the absence of a systemised process for reverse logistics creates a liquidation challenge.  

Indian consumer v/s foreign consumer

Chowdhary believes Indian consumers demonstrate a notable inclination towards nature-based products and thoses linked to Indian cultural heritage and traditions. Ayurveda plays a pivotal role in shaping consumer preferences in India, fostering trust in natural remedies and ingredients. In markets such as the US, a focus on sustainable practices and clean products is encouraged and supported by the consumer.

Yu Foods' Bhalla said, “The concept of ‘Clean Label’ is somewhat more prevalent in some global markets currently compared to India with consumers being more conscious about food labels and ingredients.”

“While Indian consumers prioritise holistic wellness and have a strong familiarity with traditional ingredients, foreign consumers may lean towards products that align more closely with scientific research and pharmaceutical advancements. But, both Indian and foreign markets are showing a growing interest in nature-based products with ingredients like vitamin C, suggesting a global shift towards more natural and traditional remedies,” Chowdhary added.

Post-launch strategy

Post the launch, the next steps for WOW Skin includes continuous research to understand and adapt to local skincare preferences. Further, optimising supply chains for seamless international delivery is crucial for customer satisfaction. Stellar customer support further solidifies the brand's presence, fostering positive reviews and customer loyalty.

“Avoiding a 'One-Size-Fits-All' approach and tailoring strategies to each market's unique demands. This commitment ensures sustained success in the ever-evolving global skincare arena,” Chowdhary said.

The right packaging, size of the product and every minute detail of the brand should be tailored for the specific market. It never works with ‘One-size fits all’ strategy, according to Ladia.

Yu Foods believes to offtake from shelves and repeat purchases, it is important to drive brand and product awareness. Accordingly, product sampling and overall branding remain pivotal for any brand to sustain sales.

As a tip for founders who think of selling across borders, the D2C Insider executive said, “Think of it as a new business and not an extension of our already existing business. You cannot have the same product, marketing strategy, communication, distribution working for every market. Additionally, if you have the bandwidth for it only then think of going global. Founders should not think of it as just an additional two-five percent of sales growth, it's much more than that.”