Ein Elefant beginnt zu tanzen

von Kristina Bonitz und Isabelle-Jasmin Roth

Indiens Wirtschaft wächst. Besonders die Mittelklasse stellt eine immer attraktivere Kundengruppe für Messen und Unternehmen dar. Das Trendbüro verrät, auf was Sie achten sollten. 

Keine Macht der Welt kann unser Land davon abhalten, neue Gipfel des Fortschritts und der Entwicklung zu erklimmen.“ Das versprach der indische Premierminister

Manmohan Singh zum diesjährigen nationalen Unabhängigkeitstag. Das Land, etwa zehnmal so groß wie Deutschland, wird sich laut der Unternehmensberatung Pricewaterhouse Coopers bis zum Jahr 2050 zur drittgrößten Wirtschaftsmacht hinter China und den USA entwickeln. Im gleichen Jahr wird es auch das bevölkerungsreichste Land der Welt sein. Diese rasanten Veränderungen werden nicht spurlos an Europa vorbeigehen.

Indien gewinnt neben China und anderen BRIC- Märkten als günstiger Produktionsstandort, vor allem aber auch als attraktiver Absatzmarkt an Bedeutung. Zwar hat es momentan noch weniger Einwohner als China, doch weil Indien weltweit das Land mit den meisten 25-Jährigen ist, wird die Zahl der Erwerbstätigen dort in den nächsten Jahrzehnten global gesehen die höchste sein. Indiens junge Generation bietet die nötige Arbeitskraft und den Unternehmergeist, um das Land auf seinem Wachstumspfad voranzutreiben, und wird laut der Boston Consulting Group bis 2020 für 26 Prozent der Kaufkraft des Landes verantwortlich sein.

400.000 Millionäre

Gleichzeitig wächst das Vermögen reicher Inder schneller als im weltweiten Vergleich und wird sich bis 2016 nahezu verdreifachen. Die Zahl der indischen Millionäre wird sich bis 2017 auf 400.000 erhöhen, was vor allem die Nachfrage an Luxusgütern in die Höhe schnellen lässt. So soll der indische Luxussektor allein noch in diesem Jahr um 25 Prozent wachsen und bis 2015 einen Markt von 14,7 Milliarden US-Dollar umfassen. Allein der Umsatz mit Luxusuhren und Schmuck wächst jährlich um 40 Prozent. Einer der wichtigsten Treiber und die Wunsch-Zielgruppe vieler Unternehmen ist die stark anwachsende indische Mittelschicht. Ihr Anteil an der indischen Gesamtbevölkerung ist mit nur 13 Prozent noch verhältnismäßig klein, dennoch besitzt die aufstrebende Mittelschicht 49 Prozent der indischen Autos, 46 Prozent der Kreditkarten und mehr als die Hälfte aller Computer und Klimaanlagen im Land.

Messeauftritt als erster Marktindikator

Vor diesem Hintergrund schauen Unternehmer verstärkt nach Indien. Hier bieten sich attraktive Standortbedingungen für ausländische Investoren und Firmen. Da Englisch, besonders im urbanen Indien, als gängige Wirtschaftssprache genutzt wird, bestehen für internationale Investoren weniger sprachliche Hindernisse als etwa in China. Zudem erlaubte die indische Regierung seit Anfang des Jahres auch ausländischen Privatinvestoren direkten Zugang zum Aktienmarkt. So ist eine Art zweite Welle deutscher Unternehmer, die ihr Glück in Indien suchen, zu verzeichnen.

Auch Messen leisten ihren Beitrag, den Markteintritt zu vereinfachen. Hier werden nicht nur Marken präsentiert, sondern auch erste Geschäftspartnerschaften geschlossen und Neuprojekte verhandelt. Dies hat die Messe Frankfurt früh erkannt und mit einer breitgefächerten internationalen Strategie antizipiert. Nach China und Russland liegt der Fokus auf Indien, wo die Präsenzen deutlich erweitert werden. So hat sich die Lichtfachmesse Light India ebenso etabliert wie die Sicherheitstechnikmesse Secutec, zu deren Premiere in Mumbai mehr als 14.000 Besucher und 143 Aussteller kamen. Im Februar 2013 wird zudem erstmals die Automechanika in Neu Delhi stattfinden. Gerade in der Automobilindustrie hält der indische Markt bisher unerschlossenes Potenzial bereit. Fachleute erwarten, dass sich Indien mit einem Absatzvolumen von elf Millionen Autos bis 2020 zum drittgrößten Automobilmarkt weltweit entwickeln wird.

Regionale Anpassung

Wer in Indien Erfolg haben will, braucht eine solide Finanzierung, ein Netzwerk vor Ort – und vor allem Anpassung an die kulturellen Eigenheiten und Konsumentenansprüche. So rüsten deutsche Autobauer ihre Modelle mit einer leistungsstärkeren Hupe aus. Denn im Verkehrschaos in Mumbai beispielsweise wird durchschnittlich an einem Tag soviel gehupt wie in Deutschland in einem Jahr. Eine bei uns gebräuchliche Hupe würde nur etwa zwei bis drei Wochen halten. „Um in Indien zu bestehen“, sagt Christian Stipp, Geschäftsführer der Münchner Live-Kommunikations-Agentur Avantgarde mit einer indischen Niederlassung, „müssen internationale Firmen ihr Portfolio auf den jeweiligen regionalen Markt ausrichten.“ Dabei zahlt sich Langfristigkeit aus. Denn ein indisches Sprichwort sagt: Am Ende wird alles gut – und wenn es noch nicht gut ist, dann ist es auch noch nicht das Ende.

During a conference visit in Mumbai in October 2011, I had the chance to spend a wonderful afternoon in Dharavi. Let the visuals speak for themselves… but if you want to have some basic facts and figures about Asia’s largest slum, check out this short presentation.

2011-10-18-FES Mumbai

The foam is very cold at -5 degrees celcius, which, according to Kirin, can help keep the beer below it ice-cold for roughly thirty minutes.

Ichiban Shibori Frozen Draft is available in Tokyo for a trial run and will be launched throughout Japan by May.

Via: PSFK.

Das letzte Mal, als er mich mitgenommen hat, haben wir nicht miteinander gesprochen; ich glaube, am Telefon gewesen zu sein oder mit Bekannten. Daher bin ich erstaunt über die guten Englisch-Kenntisse des Mannes, der unser Gefährt so mühelos und mit stoischer Gelassenheit durch den Abendverkehr der Haupstadt lenkt. Die erste Frage “Where are you from?” verwickelt uns sogleich in ein Gespräch; besser: in einen Monolog, denn es stellt sich im Laufe der 15-minütigen Fahrtzeit heraus, das Vijay, so sein Name, eine Vorliebe für deutsche Fahrzeuge hegt.

Während er aber zunächst von seiner Frau und ihrer Erwartung erzählt, am in Kürze anstehenden Hochzeitstag von ihm mit goldenem Schmuck beschenkt zu werden, gestikuliert er ausdrucksstark mit einer, manchmal auch mit beiden Händen gleichzeitig. Neben uns bringen vollbepackte Busse und Roller auf der mehrspurigen Strasse die Schar arbeitsamer Inder zurück zu ihren Familien; wahrscheinlich mit Vorfreude auf das bereits aufgetischte Abendessen und die schier endlose Aneinanderreihung der Fernseh-Soaps, die den indischen Alltag von der heimischen Couch in die Studio-Wohnzimmer Mumbais vertagen. Ein kollektives Teilen gleicher Sorgen und Freuden indischer Großfamilien im ganzen Land.

Allmählich bemerke ich, dass Vijay mit Absicht kleine Umwege fährt, um die Fahrtzeit herauszuzögern. Da wir nicht mit Taxometer, sondern auf Festpreis fahren, kann es mir egal sein, aber ich bin müde und möchte nach Hause. Doch irgendetwas kann ich gut an ihm leiden. Er ist höflich und fragt immer wieder, ob er mich mit seinen Erzählungen langweilen würde. Bevor ich allerdings antworten kann, springt er wieder zum nächsten Thema. Er wünscht sich, dass er seiner einzigen Tochter, 4 Jahre “and the sweetest girl in the world”, ein besseres Leben bieten kann. Während er uns an einer Ampel an stehenden Fahrzeugen vorbei manoevriert, versucht er, ein Bild von ihr aus seiner Geldbörse herauszufischen, doch ich winke, um unserer beiden Leben willen, beherzt ab; dabei immer wieder bekräftigend, dass sie mit Sicherheit die tollste seiner Töchter sei.

Er würde er am Tag 14 Stunden Menschen durch die Strassen Delhis’ kutschieren, immer darauf aus, einen guten Preis zu erzielen, da er Geld beiseite legt, um eine eigene Auto-Rickshaw zu kaufen. “5,5 lakh, with interest” soll sie kosten, also mehr als 8000 Euro; ich kann es mir kaum vorstellen, aber er beharrt auf dieser Zahl. ”The Delhi Government wants to make it hard for us people, you know, madam?” sagt er. “But not with me, madam, I will make it, a good business, and  I will work hard, and then, one day, I can buy a BMW, you know, madam? A very good car. In black, with dark glasses, like the rich men. Then I am also a rich man, in this life, you know? And then my daughter can marry a rich man, and I don’t need to work anymore. That’s my biggest dream. Good plan, madam, yes?”

Kurz darauf stehen wir vor meiner Tür, ich gebe ihm das Geld, passend abgezählt, weniger als 1 Euro. Er winkt und fährt fröhlich davon, noch 2 Stunden liegen vor ihm, bevor er zu Frau und Tochter nach Hause fährt. Es ist verrückt. Aber  die Zeichen stehen gut – denn Vijay bedeutet auf Hindi ‘Sieg’, oder auch ‘Triumph’.  Remember: in India, everything is possible.

Ich freue mich auf unsere nächste Fahrt.

Delhi, 7.04.2012

Just Cities – The world problems need urban solutions.

by Isabelle-Jasmin Roth, February 2012

Please find here the link to download the entire paper (PDF).

The graphic is designed by Dwarka Nath Sinha.

In today’s fast paced world, a city is not merely a place of dwelling – rather it’s a catalyst in the process of economic and  social growth and innovation. However, it is the sustainable urban development and its effects on social and environmental development that one needs to start looking at. Despite the looming challenges regarding the management of mass migration that lay ahead, the benefits that urbanisation brings with it are numerous – certainly paving a way for a new cultural and economic boom.

1. Problem and Solution in One – The Fate of Modern Cities

We are living in an urban age: in this century alone, the world’s urban population has grown from 220 million to almost three billion. Another three billion will likely have been added by 2050 – continuing a trend that has been accelerating since the late 1980s. UN forecasts show that in 2050, more than 70 per cent of the world’s population will be living in cities. Today, one out of two humans already live in an urban environment. The rapid population growth has been accompanied by an increase in the number and size of cities and has created the phenomenon of »megacities«: urban areas with a population of 10 million or more. There are currently 19 megacities in the world – most of the new ones are in developing countries. The number is expected to rise to 26 in 2025 and developing countries in Asia will host 12 of them. Hence, over half of all urban growth will take place in China and India, which are emerging as centres of economic growth – as the mainspring of urbanisation is certainly economic.

According to the World Bank, 75 per cent of global economic production takes place in cities; in developing countries, the corresponding share is rapidly increasing. In many developing countries, the urban GDP-share has already surpassed 60 per cent. Therefore, the urban economic competitiveness is a critical factor in attracting further foreign investments and human capital, which again is necessary to push the improvement of social and physical infrastructure. Against the backdrop of this economic dimension, successful cities also face a temporal dimension: they must continue to evolve constantly in order to remain relevant and globally competitive. In countries like China and India, this evolvement takes place almost naturally due to massive construction work, for instance roads, harbours, and real estate. It is projected that the total built-up urban surface area in develop- ing countries will triple between 2000 and 2030: from 200,000 to 600,000 square kilometres. This means that the additional 400,000 square kilometres being con- structed during the 30-year period will equal the total urban surface area worldwide as of the year 2000.

Thus, the overall urban scenario leads to unprecedented challenges, most important of which are: dealing with (informal) population growth; providing access to resources such as clean water and electricity, as well as housing, social infrastructure, and sanitation; enforcing stricter urban pollution control; and introducing new, less oil-intensive mobility concepts.

Nevertheless, cities all over the world are central to the process of economic and social growth and innovation. In their function as laboratories for observing political and economic dynamics at work and for testing new technical solutions and public policies in a dense and interconnected environment, cities become important change agents. It is therefore the type of urbanisation rather than the city per se that will determine the course of sustainable development.5 But what actually defines a functional, »sustainable« city?

2. Sustainable City Development: Choice or Necessity?

The term »sustainability« is one of the most (mis-) used words of this century. Originally mentioned in the for- estry discipline, the Club of Rome’s study »Limits of Growth« (1972) was a prelude to the use of the word internationally. For the first time, the report considered cities in their global interconnectedness as comprehen- sive ecotopes, whose living conditions have vast impact on future generations. In a city context, the most widely known definition was stated by the Brundtland Commission (1987), which added a social and economic dimension to the original human-ecological understanding of sustainability. Later on, the Aarlborg Charta (1994) and the UN Habitat II Conference in Istanbul (1996) allotted municipalities a special responsibility on the path to sustainable urban development. However, despite many other subsequent international standards and guidelines, including the Agenda 21 (Rio Declaration, 1992), the concept of urban sustainability remains quite nebulous. Therefore, maybe the most obvious distinction concerning sustainable city development is the green transformation of existing (mega)cities, as case studies of New Mexico, Mumbai, or Stockholm show, in comparison to new eco-city projects such as Ras Al Khaimah Eco City RAK (United Arab Emirates) or Dhonhgang (near Shanghai). But will the latter vision – the planning of new cities from scratch – have the potential to be replicable and therefore serve as a realistic model for future city development?

Let us take an example from the desert: the ambitious Masdar City Project in Abu Dhabi. Co-engineered by German company Transsolar, Stuttgart, and designed by Foster & Partners, Masdar is supposed to be the first energy-autarkic and CO2-emission-free city ever. Its policies include the banning of all pollutive factors, an 80 per cent reduction in the city’s energy consumption, and a goal of 100 per cent renewable electricity generation. In addition, the 6-square-kilometre city is following the 10-point guideline compiled in the WWF One World Planet Living Sustainability Standards, which include, for example, environmentally friendly transport and the aim to be waste-free through consequent recycling of all used materials. Masdar City wants to offer 50,000 citizens a home after its inauguration in 2020. However, one may ask if the idea of building a city in an inhospitable desert state for an international clientele itself is not deeply unsustainable. In 2008, financial problems during the global crisis led to a halt of construction work – the project costing 22 billion US dollars was about to collapse. But even if Masdar City will become a new urban role model for sustainability, it would have only limited relevance to a world in which most people live from hand to mouth. For those people, sustainability has simply no immediate relevance; the struggle of surviving holds obvious priority.

But this social dimension – which includes poverty and deprivation, gender inequality, and social exclusion – is central to sustainable urban development at all levels and in human settlements of all sizes. Often it is the poor who suffer from the lack of infrastructure development during rapid urbanisation in developing cities. Currently, one in three city dwellers lives in urban slums with al- most no water and sanitation, inadequate hygiene, and frequent lack of state protection. That is why more and more states are trying to reduce rural migration to the cities – 72 per cent of economically developing countries had set up similar programmes in 2009, compared to 44 per cent in 1976. Hence, it seems that the innovative transformation of existing as well as rapidly growing cities is the key to sustainable urbanisation. Rapidly developing cities simply cannot replicate the urban growth model of the industrialised world, which is based on low energy prices and the distribution of resources from the hinterland.

This point leads to the global dimension of the discussion: it is the effects that urbanisation processes in cities like Mumbai, New Mexico, or Beijing have on the cli- mate and on natural resources that deeply concern industrialised countries, too. The tremendous demands of emerging cities will impact global fuel, food, and steel prices and affect global CO2 mitigation targets as well as international trade. For example, 1 per cent growth in urbanisation is estimated to lead to a 2.2 per cent in- crease in energy consumption. Considering the projected growth rate of 150 per cent between 1990 and 2025 – which, as discussed, will mainly take place in Asia – it should thus quadruple overall energy consumption. The resulting CO2 emissions will be responsible for half of the changes affecting the planet’s climate.

According to the Stern Review on the Economics of Climate Change, the »business as usual« scenario could lead to a 5-10 per cent loss in global GDP; poor countries would experience a loss of more than 10 per cent in GDP. In total, this could lead to a reduction of between 5 and 20 per cent in per capita consumption.10 On the other hand, the argument that emerging countries should slow down their economic development because of global emissions is unlikely to deter them. Actually, it will be the opposite: emerging countries have to grow rapidly for a number of years to reduce poverty and generate the resources needed to provide social and physical infrastructure for education, health service, clean water, sanitation, transport, and energy. Hence, developing new and adaptive solutions in an emerging urban context is absolutely necessary for sustaining the global »green deal«. At the same time, the success of implementation, for example through strict policies and municipal financing schemes, has to be a conscious choice advocated by all local urban stakehol- ders in order to create long-term impact. All this leaves decision-makers with huge challenges. But for countries like India and China, for example, the urban scenario also offers the unique opportunity for them to become pioneers: even though their cities are at the heart of the problem, they also contain the mechanisms to solve it. The revised question in the global urbanisation scena- rio could be: Can emerging cities set new sustainability standards?

Countries such as China and India are facing four major challenges at the same time: (1) immense population (growth), (2) vast industrialisation, (3) scarcity of resour- ces, and (4) a bureaucracy that cannot follow the speed of transformation, especially when pushed by factors (1) and (2). This overall scenario puts pressure on citi- zens, politicians, and bureaucrats as well as businesses. On the other hand, the countries’ growth scenarios create a set of new opportunities, because their speed of transformation enables innovation in a measurable timeframe. The result is that emerging countries func- tion as laboratories for adaptations: in the private sector through entrepreneurship; in the public sector through new and innovate policy guidelines and implementation strategies. To ensure that these adaptations are success- ful, emerging countries have to join forces. The good news is that they do not have to start from scratch, as there are already good models out there. Let us start with a case study from the largest democracy in the world: India.

3. Sustainable City Development: The Reality Check

India is witnessing an urban transformation of an en- tirely novel scale and speed. The Ministry of Urban Development estimates the country’s urban population to increase from 286 million in 2001 to 320 million in 2011 and 530 million in 2021. The urban centres are already under strain. Populations of new megacities such as Bangalore (currently 5.5 million) or Chennai (currently 4.7 million) will increase, and existing megacities such as Mumbai (19 million) and New Delhi (16.7 million) will triple in size by 2050. Furthermore, the urban economy has bypassed most of the country’s 600,000 villages. Uncertainties in rural life compel the population to migrate to cities in search of a better livelihood. According to the National Sample Survey Organisation (2007), about 50 per cent of the farmers have thought about leaving agriculture if they were to find an alternate livelihood. Megacities of India can expect an inflow of climate refugees not only from the rural areas of India, but also from the neighbouring countries like Bangladesh, where the impacts of climate change will be more severe. According to the World Bank, 30 rural migrants will arrive in an Indian city every minute over the next 20 years. To tackle this challenge, India has to build 500 new cities. For Joan Cloas, Executive Director of UN HABITAT, it is clear that migration into cities is the most serious current political and economic development. At the same time, the consequences of urban pollution, stressed resources, and its effects on millions of dwellers is likely to become a significant negative factor of India’s economic development. Thus, the second most populous country in the world will increase its CO2 emissions to 7.3 billion tonnes annually by 2031, about five times the current emission rate of 1.5 billion tonnes (per capita).

So far, India still has a lower energy intensity than China or the United States. This is the result of the low-carbon character of the country’s economy, which is weighted towards services and a relative low level of income, especially in the informal sector (it is estimated that only 9 per cent of workers in India hold official jobs and that 15 per cent of urban Indians live in informal slum settlements). But this scenario is about to change and the elements are already there: although less than a third of India is urbanised, its urban population is already larger than that of the United States.11 India’s urban areas already account for about 60 per cent of the overall energy consumption, but at the same time, the productivity of the urban sector contributes 60 per cent to India’s GDP. The central government has advised the states to minimise subsidies and to place urban development plans and projects in a commercial format and to col- lect additional taxes to minimise the differences in cost of operation and income. Municipalities are focussing on tax-free bonds to provide money for infrastructure development. The government is also seeking private sector participation in providing reliable water supplies. Currently, the decision-makers are in the process of amending existing laws for increased transparency and accountability regarding the utilisation of public funds for the development of urban areas. The national cli- mate change policy, released in 2008, does not provide strong implementation guidelines for the implementa- tion of adaptation strategies for India’s cities.

Therefore, international support is needed to tackle the challenges of a sustainable urban transformation. With regard to technology transfer, one of the forerunners is Japan. For instance, the Japan International Cooperation Agency is involved in drafting the Delhi Water Plan 2021, which is intended to improve the city’s water supply system. But this is not the only cooperation: additionally, in November 2010, India and Japan unveiled a plan to launch 24 green cities along the Delhi-Mumbai Industrial Corridor. These green cities will have optimised energy supplies, a 24-hour potable water supply, bicycle and walking paths, and water and waste recycling systems. Preparatory work has begun on pilot projects in seven cities. Companies like Hitachi, Mitsubishi, and Toshiba are participating in the design and construction of eco-friendly towns. The reason is that Japan has a lot of experience in developing and implementing sustainable urban practices. Let us have a look at another case study: the city of Yokohama.

With almost 4 million citizens, Yokohama is the second largest city in Japan and became a global role model for sustainable waste management, also known as the G30 plan. The plan was initiated in 2003 and aimed at a reduction of 30 per cent in waste generation by the end of the fiscal year 2010. What stood out in the plan- ning process was the strong involvement of all stakeholders in clearly identifying the different responsibilities of households, businesses, and the public sector. For example, in order to recycle reusable resources and reduce waste emissions as much as possible, the number of categories for separating of household waste has been increased from 5 to 10, and the number of items have increased from 7 to 15. In 2005, this system was in place across the entire city. Additionally, environmental education and various promotional activities related to waste reduction have been undertaken to enhance awareness. The results were stunning: The city of Yokohama reduced waste-generation by 38.7 per cent,12 from about 1.6 million tonnes in 2001 to 1.0 million tonnes in 2007, all while the city’s population rose by around 166,000 during the same period.13 This significant development allowed Yokohama to close two incinerators, which saved the city the more than 1.1 billion US dollars (capital cost) that would have been required for their renovation.

Other calculations show that waste reduction in the same period resulted in a decline of about 840,000 tonnes of CO2 emissions, which is equivalent to the amount that 60 million Japanese cedar trees can absorb annually. The government of Yokohama calculated that ap- proximately 600 square kilometres (an area 14 times as large as the city) would be needed to plant 60 million cedar trees.

Cities have been known to be places of progress, emancipation, free spirits, and social change. Cities have resources such as knowledge, technical and cultural innovation, and creativity. Additionally, their political power makes them catalysts of modern lifestyles, and in these days a modern lifestyle is one of sustainability and awareness. Hence, modern cities have to use their vast knowledge and avoid mistakes in the existing city planning. Modern cities have to focus more on the implementation of pragmatic solutions. Necessary to reach that end is the sharing of experiences and best practice projects through international platforms. A good example is the »Urban Age Project«, organised by the London School of Economics in cooperation with the Alfred Herrhausen Society, which is the international fo- rum of Deutsche Bank. The project is an international investigation of the spatial and social dynamics of cities centred on an annual conference, research initiatives, and publications. Powered by another German icon, Siemens, »The Sustainable City Collective« has become an interactive platform that collects case studies and best practices from all over the world.

More companies understand that they have to adapt their products to the needs of megacities. Global players such as Siemens, General Electric, ABB, IBM, and Cisco are already preparing for the opportunities with the development of smart grids, driverless electrical vehicles, intelligent housing technologies, and instruments for the intelligent usage of water and energy (for example, Siemens recently launched its new business field »infrastructure and cities«). This development offers a new interesting perspective, as private companies and the public sector both have to adapt to each others’ practices in order to create significant impacts. This new approach has the potential to change the usual business patterns, and hence could result in a significant rise of public-private partnerships, especially in emerging countries. The future path has to focus on innovative, systemic, and economic solutions for better cities. Only when all urban stakeholders understand that sustain- able urbanisation is impossible if it is based on standard practices will, the new, green urban area have the potential to begin.

4. Conclusion

Despite the uncertainties surrounding these global urban challenges, the chances for progress that urbanisation brings with it are numerous: if the future generation of city planners are able to manage the upcoming mass migration in a socially and politically acceptable way, this change has the potential to be the motor of a new cultural and economic boom. At the same time, the risks are high. If this »experiment« does not work, (mega)cities all over the world will disappear in waste, traffic, and poverty. In the end, a lack of perspective and frustration can discharge in a never before existing dimension. A recent study by the consulting firm Booz & Company points out that cities all over the world have to invest 351 billion US dollars in the next 30 years to modernise and improve their social and physical infrastructures. But the research also shows that the total sum can be reduced to 296 billion US dollars if urban decision-makers focus on an immediate transformation towards energy-efficient public transport systems and the usage of renewable energy. Hence, the necessity for a sustainable urban development cannot be neglected anymore – and the urgency of action is greater than ever before.

About the author

Isabelle-Jasmin Roth is Managing Director of the Indian branch of Germany’s leading experiential marketing agency Avantgarde. She is living and working in India since three years, focusing on urban transformation and business models ever since she arrived in India.

Luxury brands have taken to experiential marketing with gusto; many consumer durables companies are also focusing this tool for their luxury products

Sandeep Sethi, a senior real-estate marketing professional, was blown away by the experience during his first visit to the Audi store at Mathura Road, New Delhi. The showroom was spacious, which made him feel comfortable, and he could easily cruise through the store without encountering any roadblocks. The various models were neatly displayed, and help was at hand in case he needed to clear any doubt. He was thoroughly impressed by the professionalism. Now Sethi drives around in an Audi A4.

This two-storey showroom of the German luxury car manufacturer, Audi, has 20 cars on display, and is spread over an area of 30,000 sq ft. The showroom is based on the unique Audi Terminal concept and has a unique 250-ft wide store front. It has a honeycomb aluminum façade and inside the showroom there are escalators to ferry prospective buyers up and down. It hosts the Audi Shop and the Audi Exclusive Elements, where customers can order customised products and purchase a variety of Audi branded merchandise. “Audi has 15 showrooms in India based on the Audi terminal concept. Six of these are Audi terminals and the rest are Audi terminal concepts. While the terminal’s architecture embodies the sportiness of the brand, the aluminium façade reflects Audi’s expertise in lightweight design,” says Michael Perschke, head, Audi India. In short, the onus is on providing a unique experience first — no hard sell, no desperate salesmen shadowing you till the end of the aisle. But Audi is not alone. Most luxury brands have taken to experiential marketing with gusto; many consumer durables companies are also focusing this tool to showcase their luxury products.

Is this simply the age-old sampling in a new bottle or is it an innovative way of wooing consumers. Narayan Devanathan, national planning head, Dentsu Marcom, says, “It’s what brands have been doing at Pragati Maidan for decades now at the Trade Fair, the Book Fair and the Auto Expo. It’s what brands have been doing at rural haats and melas for years. What has happened is luxury products are using this concept because they have very limited avenues to showcase their products.”

That said, this also opens up opportunities for specialised firms/agencies in India. Mark Barrett, chief executive officer, Asia Pacific, of London-headquartered creative agency Imagination, says, “We focus on the reflection of a brand’s values in our styling and interior of the concept stores, brand experience centres, exhibitions and events, which are now playing a major role in brand management. Increasingly in India across sectors such as retail, automotive and technology bringing  brands to life is getting critical.”
Sensing an opportunity, a bunch of global communication agencies have now set up shop in the country to lend a helping hand to their clients to develop strong and unique creative concepts in the field of experiential marketing. Isabelle-Jasmin Roth, managing director, India, of Munich-based communications agency Avantgarde, says, “The concept of experiential marketing in India is not entirely new — a lot of companies like Mercedes Benz or Tag Heuer are already working with this concept. The main industry clusters are automotive and lifestyle, plus the fast growing luxury marketing outfits. Experiential marketing holds a strong sales proposition in terms of bringing a client as close to the brand as possible, through the interaction of all of his or her senses and emotions. The risk is if you don’t execute experiential marketing well, it kicks back strongly in a negative manner.”

It’s not just through experience zones that companies are trying to woo prospective buyers or improve their brand recall; there are events that seem to serve a similar need. Perschke of Audi India says, “We do such events with our dealers. We had a fashion show with designer Vijay Arora that showcased our products through a lifestyle experience.”
Korean consumer electronics company LG also uses events and roadshows to get close to its consumers, especially for its premium products. LK Gupta, vice-president (corporate marketing), LG India, says, “With our Experience on Wheels campaign, we took our high-end products to the doorsteps of people. With a budget of Rs 10 crore, five luxury Volvo buses will cover 150 plus cities. These are designed to look like mini apartments and aim to show how a home might look in the future. There are indoor consultants, who give advice on how to do up a home. Starting in October 2011, this campaign will run for about a year.”

Consumer contact is high on most consumer durables company’s agenda. Anirudh Dhoot , director, Videocon Group, says, “It is high on every company’s agenda because it is an exclusive platform to showcase one’s products on one’s own terms and ensure the best experience to the customer. In this industry one needs to feel and experience products to get convinced and make a decision to buy, especially so for high-end products. We frequently do ground activation, such as mall activity, mobile experience zones for LCD/LED TVs and high-end washing machines, side-by-side refrigerators, microwaves etc.”

Smart phone leader Samsung has unveiled a similar initiative. “Samsung Smartphone Cafe is a retail initiative that we started last year wherein we sell and display smartphones, tablets and laptops. Samsung product consultants at the Smartphone Cafes and Plazas demonstrate the products like flat panel TVs (3D, LED, LCD), home theatre systems, digital cameras, refrigerators, washing machines, microwave ovens, A/Cs, tablets, smartphones and printers — all displayed in an uncluttered shopping environment. The product display is interactive and aimed to engage the customers better,” says a company spokesperson.

The idea of offering the experience first seems to be catching on with real-estate developers like Ashiana Housing. It has something like a trial home which gives the prospective buyer a clear idea of the floor area, specifications, facilities and services. People can come and choose to stay for a week or a month before deciding to buy a flat. You have to pay a price for this but that’s just a token amount, insists Ankur Gupta, joint managing director, Ashiana Housing. “The idea behind trial apartments is to give customers a first-hand experience,” he says. “At one of our properties we have had 90 per cent conversion, which includes customers who have taken a unit on rent as well as those who have purchased a unit after staying in a trial apartment. We hope this ratio will increase as people become aware about this concept.”