India, a country of more than a billion people, is known for its economic diversity and continuous growth. But it is also a market that can be extremely communication intensive and requires ongoing care and attention. A well-known European company in the tourism industry experienced this “the hard way” and within a short period of time lost market share and reputation that had been built up over decades.
The background
The company in question operates travel logistics for tourists traveling to India as well as Indian tourists visiting Europe and the USA. It had established a dominant presence in India over decades. It was supported in this by a network of deep-rooted relationships and partnerships with key players that the company's senior management had built and maintained over the years in India. This has been the key to its success and its ability to respond to the ever-changing needs and expectations of the market.
Through its contacts, the company had developed into the central contact for all questions about travel and tourism in India. For example, if the responsible ministry or the operators of state tourism programs wanted to know how ecologically sustainable tourism works in Europe, they would ask the company. If you wanted to know how you could organize more comfort for arriving tourists at Indian airports, you asked the company. If you wanted to know how tourists could cope with the monsoon in some parts of the country, you asked the company. All of these questions had nothing directly to do with the company, but you knew that the company had more international experience or contacts in the area than you did.
Through this intensive exchange and partnerships with key players, including the Indian government, the company also acquired extensive knowledge and insights into the Indian characteristics in order to meet the specific needs of the Indian market. And of course this earned the trust of the actors.
Der Wendepunkt
This well-deserved reputation began to fade when a new European manager took over who did not understand the intricacies of the Indian market and changed the company's strategic direction. His lack of knowledge of the Indian market led to his decision to stop maintaining contacts; True to the motto: “We are the successful market leader, we are the big player and we are so powerful that we no longer need to maintain these contacts.” The abandonment of the close contacts and relationships that had been cultivated for years led to a rapid loss of trust. The Indian government and other key players perceived this behavior as a retreat, and the company lost its privileged status.
The consequences of withdrawal
The vacuum created by the company's absence among contacts and key players was quickly filled by international competitors. The Indian government and business partners quickly looked for alternative partnerships. Competitors from the Gulf states seized the opportunity and immediately expanded into the Indian market. The once leading European company found out about these developments too late and lost significant market share unnoticed.
The change in customer perception
Word of this also got around in the market. Because there are no secrets in India. The company's reputation suffered: the company had become arrogant and no longer considered it necessary to make efforts in India. India would simply no longer be interested.
In addition, there were a number of other wrong decisions due to the lack of cultural empathy of the new manager or the decision-makers at the European headquarters. For example, specific Indian amenities were removed from the menu and regular modernization measures were suspended. This behavior intensified the feeling of neglect among Indian customers. Customers began to perceive the company as distant and uninterested in their needs. Even seemingly minor decisions (such as closing certain city offices) reinforced this impression. The company went from being a valued partner to being an outsider.
The legacy of error
The company's strategic realignment and its unspoken message that India was no longer a priority were in direct contradiction to its previous slogan "We know India better than anyone else". This discrepancy was interpreted by the Indian customers as a deception and led to an increase in the breach of trust.
The lessons
This company's experience serves as a cautionary tale about the importance of continuous cultivation and adaptation to the Indian market, an environment characterized by its sensitivity to discrimination and its expectation of authentic partnerships. One lesson that can be learned from this company's experience is the imperative need to develop and maintain a deep understanding and ongoing appreciation for the cultural and business nuances of India.
The country, constantly striving for change, requires from international companies a high level of commitment, flexibility and respect for its culture and business practices. In India, market share is gained and maintained not only through excellent service, but also through building and maintaining relationships at all levels.
Our case highlights the need to approach India with a specific, long-term strategy. Companies that make the mistake of shifting efforts or reducing commitment may find themselves losing not only market share but also the trust and respect of Indian customers and partners.
The example also calls for vigilance and adaptability, emphasizes the importance of authenticity and shows the devastating consequences that neglecting these principles can have in a market as diverse and dynamic as India. Reclaiming lost ground will be a challenge that goes well beyond large financial investments – it will require restoring lost trust and damaged reputations.
Why do Europeans find it so difficult to maintain contacts in India?
A commonly misunderstood aspect of business management is what is meant by “maintaining contacts” in India. It is often incorrectly equated with unethical or non-compliant behavior, such as corruption.
The core of maintaining contacts lies not in the unauthorized influence of decisions or personal favors, but in the exchange of basic information about industry developments, technological trends and general global business practices, not in the direct benefit for one's own company.
In India, it is crucial to be perceived as a reliable, experienced and highly qualified expert. This goes far beyond the role of a mere supplier. It is about building a knowledge and information network that helps deepen the understanding of state-of-the-art technologies and global best practices. This role is particularly relevant in a country constantly striving for growth and innovation and characterized by a close-knit business community.
Companies that hesitate because of concerns about potential compliance risks risk missing the essential value of this type of relationship building and information sharing.
Adhering unambiguously to ethical and legal standards while still actively participating in the dynamic and interconnected business world that characterizes the Indian market is of course possible. The focus is explicitly on providing non-critical expertise and knowledge that helps to expand the general understanding of global standards. This happens without any expectation of immediate compensation or benefits.
Companies that achieve sustained success in India actively distance themselves from any appearance of dishonesty and build their relationships on the cornerstones of integrity, trust and mutual respect.
Providing expertise, experiences and insights into international trends and developments is a practice based on the principle of exchange and co-development. It is about creating a network of trust and cooperation based on a solid foundation of ethics and integrity, far from any form of advantage-taking or unclean business practices.
Conclusion
The case of the European company serves not only as a cautionary tale about the risks of neglecting such a vital market, but also as a call for reflection on the deeper, often underappreciated art of relationship cultivation that goes far beyond transactional business interactions.
