In this edition of your magazine, we have an eclectic combination of diverse topics such as premium brands and gears & drives. Could there be a common factor between these two quite opposing offerings? I found a common link that could exist - and that is "differentiation" in products or services. I will tell you why and how..., in a minute.
Cement has been famously described as a branded commodity, which in itself, is a classic contradiction of terminologies - brand vs commodity ! Markets such as India, which are still relatively developing economies, are less urbanised, and have a predominance of individual homes being built in semi-urban and rural areas, and therefore have a lot of space for brands, which would distinguish themselves on the basis of specific product offerings or promises. Some brands promise strength, some others promise durability, while some others propose trust.
That is the premise behind the plain vanilla cement brands, which sell cement in bags to individual home builders in India. On top of this, as if like the proverbial "icing" on the cake, companies attempt to create a super brand with a differentiated product/service offering at a premium price point. Such premium brands not only offer higher margins (although for smaller volumes, in niche market segments ), but also develop a rub-off effect over time, and create an aura for the mother brand which sells in volumes. Not all such efforts to create premium brands have succeeded, and many have fallen by the wayside. But those superbrands which have done well, have done so on the back of sustained product performance on the ground, delivering on the explicit and/or implicit brand promise.
And now, the story of competitive differentiation in the gears and drives space. As kilns became larger and larger, and consequently the clinker or raw meal grinding mills were being pushed to bigger configurations, there was an ever increasing demand of larger capacity of gearboxes in terms of megawatts of power transmitted, and this in turn challenged the frontiers of reliability of gearbox transmissions. In such a situation, which pushed the envelope of technology of transmission, there is this example of an enterprise, a German mittelst and, whom we have featured in this issue, who innovated to resolve the problem by breaking it down into smaller elements instead of trying to develop ever larger gearboxes. An example of differentiation, through out of the box approach.