As per
the textbook theory of market maturity in
any country, the expected stages are that
of market development, rapid growth, saturation
or maturity and the decline. Having had the
good fortune to predict the evolution of GPS
Navigation market in India, here is a retrospective
of the various phases, from both the vendor’s
and consumer perspective.
Firstly, the stage of market development from
vendor’s perspective was 1999-2003, mostly
spent in understanding the technology, identifying
various components and selecting the partners
who could supply the same. From the consumer’s
perspective, this phase started much later
from 2003-2006 during which initially there
was denial that it would ever work in India,
then pessimism when it worked but people thought
the market would not exist and finally neutrality
giving companies the benefit of doubt that
‘maybe’ it would indeed work someday! The
net result was that vendors spent time and
money waiting for the market to get ready.
Second phase of rapid market growth, interestingly,
has not happened in India even until date.
But from a vendor’s perspective the year 2007
and 2008 have seen a lot of competitive turbulence,a
very small expansion of the market, bundles
of contradictory claims from various service
providers, which are activities expected during
market growth only. From a consumer perspective
the same years have already given him better
pricing, more choice of product and an opportunity
to give user feedback that help improve the
product. The net result is that it is a consumer
market already, but growth is yet to come!
The third stage of market saturation and maturity
from a vendor’s perspective is expected to
be from 2007-2009, comprising of focus on
product differentiators, identification of
raw iron components costing as well as efforts
to control the technical customer support
costs. From a consumer perspective this phase
is expected between 2008-2010, consumers will
benefit from more choices in the market, excellent
customer service and value additions to the
product which help in its daily usage. The
net result is that both consumers and vendors
begin to reap some of the benefits from the
market.
The fourth stage of market evolution, decline,
is still some distance away from the Indian
market. In this phase vendors should expect
that the product itselfwill become invisible,
market reach will be critical, all will need
to look at new markets within existing segments.
From a consumer perspective it will become
a commodity product, people with new toy syndrome
would change devices periodically and price
would be the only factor when taking decisions.
The net result would be similar to what the
mobile phone market is undergoing and volumes
would be huge.
Companies need to watch for the above phases
and evolve their business plans such that
they emerge as leaders. The challenges are
many; the customs duties on import of GPS
devices are very high. There is enough market
for all players and it is important to encourage
competition as an engine of growth. Overall,
I can safely sum up that while the past has
been exciting and we have lived in ‘interesting
times’, the future is going to be all the
more interesting and exciting than anyone
has ever imagined. Several new markets will
be created and leaders will be made of existing
companies or born out of new ones in this
space. Let us look forward to a huge growth
in the coming years so that we can sit back
and smile when it actually does come our way.
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