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Business book review: The $10 Trillion Prize

14 Nov 2012 by BusinessTraveller
Every CEO enjoys talking about the opportunities presented by China and India. Chinese and Indian consumers are expected to spend a combined total of $64 trillion on goods and services between 2010 and 2020, “…propelling a new wave of growth in the global economy,” according to the four authors of this extremely informative and detailed book on the subjects. By 2020, these consumers will be spending a total of nearly $10 trillion annually, three times the amount they spent in 2010. For anyone in any business that is considering the Chinese or Indian market, this book is essential. The authors, all from Boston Consulting Group, offer the consultancy’s research including data from Boston Consulting Group’s global survey of 24,000 consumers - conducted by BCG’s Center for Consumer and Customer Insight - as well as one-on-one interviews with consumers and business leaders. The result is a book which at least initially is tough to read straight through, since there are so many numbers, graphs and charts, though for reference, it is unbeatable. Here you will find that the middle class in the two countries is expected to reach 1 billion by 2020, with Chinese consumers born in 2009 predicted to spend 38 times more than those born in 1960. In India, the proportion of middle-class people is expected to grow from 28 per cent in 2010 to 45 per cent in 2020. Where the book really gets going is in the insightful case studies of success stories – and failures – of companies in both China and India. Some of these are quite short but very interesting – I enjoyed the two pages on LG’s success in India after two previous failures, and the Oreo cookie in China, or KFC and Pizza Hut in China. Kraft, Yum! Brands (that’s the KFC story), PepsiCo, Gucci, LVMH, BMW, and Pernod Ricard are all featured. The lessons? Well not surprisingly the authors the authors  say that to succeed, business leaders need to embrace both countries and get to know the people: who they are, what they buy and why, how they think and shop, and how their needs and tastes are changing. I’m not sure that is very revelatory, and that the unfamiliar Hindi phrase “Paisa Vasool”, adds too much either (It means “money’s worth”, and is “used by consumers when they feel that a product offers them the perfect mix of quality and value.” Well, quite, but don’t all consumers feel the same way, whether Chinese, Indian or American? The next time you need some facts and figures to pep up a presentation, this is the book to get it from, or if you’re asked to devise a new strategy for an emerging market, there are plenty of good ideas here, backed up by some very respectable research. Not a page turner, perhaps, but well worth having on your bookshelf where others can see it. Hard to ignore that “$10 Trillion” figure on the red for prosperity bookcover! Tom Otley The $10 Trillion Prize is published by Harvard Business Review Press, £20.00
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