By Avik Chattopadhyay
An ex-boss of mine currently heading a cutting-edge analytics firm in the automotive space shares this interesting infographic shown above from time to time. While the purpose clearly is to trace how Indian automotive brands are doing vis-à-vis others, this time I asked him a basic question: ”Does country of origin really matter to a customer anymore?”
Source: JATO Dynamics
Being a brand practitioner for quite some time, this aspect of “country of origin” or, provenance, as the gurus address it, has been an important and integral part of a brand’s structure. German cars. French wine. Japanese engineering. Italian design. Russian vodka. The generation before me swore more by the country of origin than the brand by itself. German product, Grundig, is what my granduncle would say. That changed to ‘Sony makes the best television set… Japanese you know’, for my father. This generation buys a Samsung because it is a Samsung! Simple.
Post WWII, the new world order saw legacy nations reinforcing their areas of strength while new ones entered he fray, the most notable being Japan and Soviet Union. In the case of the ‘softer’ products like fashion, food and movies, provenance played a key role in the cultural revival while the ‘harder’ products like automobiles, engineering, aircraft and electronics worked towards economic rebuilding. Thus, various countries developed their areas of ‘speciality’ or ‘association’ with the larger world. My colleagues in Peugeot used to lament that even after so many years, people typically associated France only with fashion, wine and cuisine and not for nuclear power, aeronautics or engineering. The Indian or the Brazilian would not associate Airbus, Areva or Alstom with France. They might easily come from Germany or Switzerland but… France?!
My question to my colleagues in Paris remains till today – why do you want to be necessarily only French when you are already Peugeot? Provenance was an important ingredient of a product when the country it came from carried greater weight than the manufacturer of the product. So, if a machine made by an unknown company said “Made in Germany”, it automatically opened doors to business as the prospect naturally associated the country with engineering excellence. So, a “Made in Japan” television in the 1980s had to be good, whatever the brand. The country of “make” was a key factor determining choice.
The other factor that supported provenance as a differentiator was the very origin of the product. An Italian pizza brand would certainly be the most ‘original’ and superior to any other. Similarly, the Russians would make the best vodka. And the Americans when it came to fast food. How could one ever accept a Mexican samosa? One could not simple imagine, let alone accept an actual physical product.
So, post WWII, the country of origin became the calling card for organisations and corporation out to sell their products and solutions and become the new-age colonisers. For a common person to own or aspire to own such products or solutions coming from such countries was the coming of age. A German car. A Japanese television. An Italian coffee machine. A bottle of French perfume. A can of an American fizzy drink.
All this worked very well in the fist phase of this new-age colonisation when production was largely based in the home country and markets were captured through importers and distribution channels. Also, many products took pride in the fact that they were only available in their home country and a few select markets and the customer had to take the pains of going there to own one. Hence the shopping lists from family and relatives when one visited Tokyo or Dubai or Paris. The artificially induced scarcity along with provenance enhanced the status of a brand and its universal appeal. One would get the latest VCRs only in Akihabara district in Tokyo. Or the latest Hermes perfume would be available only in London, Paris or New York. In fact, many fashion and cosmetic brands used to proudly write “London-Paris-New York” on their packaging for that added impact.
The disruption came in 1980 with a man far away from all this who decided to “open” up his nation, break the shackles of an oppressive past and allow the average citizen to dream big. Deng Xiaoping started his reforms in a traditionally conservative and closed China. He famously said, “A cat may be black or white but as long as it catches mice, it is a good cat!” Pragmatic capitalism under the watchful eyes of the Communist Party was okay. That one move opened up one of the world’s biggest markets. The neo colonial organisations and brands had to have a share of this virgin market, waiting to be exploited. They were all welcome, but with a rider. They would have to necessarily manufacture in China to operate in the country, whether you wanted to sell fried potato wedges or supercars. This was to generate employment to improve the per capita income and maintain a low price to ensure affordability and acceptance. The world moved to China and we all know the rest of the story.
The one milestone change for almost all brands in the world was the beginning of a label that said “Made in China.” You could be French, English, Spanish or Canadian but you were manufacturing in China. And manufacturing enough to sell to the world. So, the embodiment of all-things-that-are-good-are-American, Apple, started saying “Designed in California. Assembled in China.” Very soon, provenance was restricted to where a brand originated from and nothing more as there was a high possibility it was made in China.
As globalisation spread, provenance contracted. Brands soon realised that they had to manufacture in all key large markets to be competitive and succeed. India and Brazil followed China. With the collapse of the Soviet Union, Russia followed too. And the global citizen was more interested in associating with a specific brand, irrespective of where it originated. The holy cows were being challenged. Finlandia made a vodka better than most Russian brands. Jacob’s Creek had nothing to do with French wine. One Plus could challenge any smartphone maker. Kia could win more Red Dot awards than a European carmaker. The South Koreans could be at the cutting-edge of lighting and not the Italians. Bang & Olufsen was not from Germany. Skagen could make a few Swiss watchmakers blush.
The world was finally one flat marketplace where a brand could no longer take refuge in the country it came from as a key differentiator. And the post-war trip of nationalistic fervour that made you buy only brands that originated in your country had evaporated. India became part of the marketplace when we liberated our markets ten years after China did.
The Indian market has matured enough to go beyond an anachronistic aspect like provenance. We buy Korean washing machines, Chinese phones, Bangladeshi apparel and South African wine. We are not emotionally blackmailed by slogans of “vocal for local” as we want that which is best for us. In his novel “Home and the world”, Tagore questions the very concept of ‘swadeshi’ through his protagonist Nikhilesh. If a home-made product cannot match the quality, durability and price of one imported from England, why should a value conscious commoner be forced to buy it?
There has to be this balance of form, functionality, durability and price that allows us to make brand choices. Otherwise, we would have bought the Tata Indica by the millions by now. Or the Bajaj Chetak. If a Hyundai or a Honda offers me better value, I shall choose that. It is as Indian as a Tata or a TVS.
Provenance is a vestige of the past.
Period.