Wednesday, April 29, 2015

Emerging Markets in India: From Fast Food to Fitness Centers

India's growth over the past decade has allowed many US based companies to enter various markets and compete successfully with local companies. The economic boom has led to a rapid increase in people's access to goods and services that were once classified as luxury. In particular, the fast food industry has reaped many benefits as the lifestyle and taste of the Indian middle class has continued to change. McDonalds, KFC, Dominos and Dunkin's Donuts are among the top players and are planning to open hundreds of stores to satisfy unmet needs in both large cities and big towns. The fast-food industry is expected to double in size within a three year period which means that many more people will be trading in their vegetarian curry dishes and for burgers and chicken nuggets. 

The growth of the fast food industry has a direct relationship with the increase in size of Indians' waist circumference. India is currently experiencing a double burden of communicable diseases like Tuberculosis and non-communicable diseases like Obesity that is expected to worsen in the coming years. Despite the negative effects that the fast food industry will have on the status of health in India, this growth also presents a great opportunity for companies in different sectors of the healthcare and health and wellness industry to develop solid strategies for entry. 

Since greater emphasis has been placed on curbing the obesity epidemic among both adults and children, numerous services, devices and products have surfaced in hopes of alleviating this obesity burden. Among many Zafgen, EntroMedics, Medifast and Life Time Fitness are a few names that saw growth opportunities around 2010. These companies provide products ranging from Beloranib, a pill that changes the way the body stores fat to pace-maker looking medical devices that modifies the amount of signals sent between the stomach and the brain. There are also a lot of profit to be made by the gym industry especially because of the trends and emphasis on body image in the US.   

Although there are so many opportunities, the success of companies in healthcare and the health and wellness industry must tailor their products, services and messaging to the Indian audience. Gyms like Gold's Gym must reorganize majority of their business, HR, management and retailing approach to fit the cultural and political context India. Although the fitness center industry is predominantly mom and pops owned, the Evolution of Fitness Industry in India article mentions the disorganized and segmented nature of the current players. Fortunately for Gold Gym, they have decided to enter the market by building up their own facility. 

Forgoing acquisitions and joint ventures was perhaps the best option for Gold's Gym because the industry is still in its infancy stages. Building their own facility will not only allow them to make a statement but also reinvent the idea of a gym in urban areas in India. Because Gold's Gym brings organization to the industry, wealthier people are more likely to purchase memberships as a symbolism of class and perhaps education.  Through creative messaging, diverse product and services offerings that are tailored to Indians, Gold's Gym is bound to be one of the major players in this industry. 

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