Frugal Brand Innovation: Not Just a Trend in India

As marketers in Western economies wait to assess the consumer impact of continuing economic weakness in the Eurozone, ModelPeople’s global blogger network has written about creative approaches to frugal brand innovation

In India, the term “jugaad” loosely, if not succinctly, translates as “the gutsy art of overcoming harsh constraints by improvising an effective solution using limited resources.” Jugaad is leading to product innovations that are affordable for average income consumers.

For example, in Bangalore, filtered water and reliable lamp lights are now available at less than pennies a day. In Delhi, the ground-breaking Mitticool, a highly affordable refrigerator, has been created for the rural population and even the classic sari is seeing itself recycled in beautiful ways. Juggad products are not confined to India: €20-30 tablets from Aakash and Wipro are on offer to austerity-driven consumers in Milan.

In Sao Paulo, new product lines with a lower price-point, such as Intense Cosmetics, are being launched for the 90 million-strong, emerging middle class called Class C. In Shanghai, entertainment complexes once used for the 2010 World Expo are now available for package family vacation destinations.

For some consumers, “green” and frugal innovation go hand in hand. In Detroit, localization has moved beyond a trend and is instead a city-wide tactic to bring both employment and revenue back to the city under the motto “Outsource to Detroit.” In Milan, community gardens help the food budget as well as the planet. In both cases, a great sense of community stems from the trend, offering both financial and emotional comfort to consumers.

Even in Moscow, where frugality is not aspirational, new retail formats like Podium-Market carry more affordable imported brands, like American Apparel.  In Tokyo, where consumers typically have high end and luxury preferences, The Economist last week hosted a seminar on the success of Walmart among older and younger consumers who are struggling with an uncertain economy and job market.

If it is true that necessity is the mother of invention, brand innovation looks set to enter an especially fertile period.