Indian Firms Globally Superior than the Chinese

Even though China has the upper hand in terms of bigger market size and larger number of customer sections for differentiation, India still emerges as the winner. The paper further highlights, "However, Indian firms are increasingly building differentiation or, to some extent, hybrid strategies to access international markets, partly because they do not have the low cost advantage that Chinese firms enjoy. Consequently, differentiation seems to be the emerging appropriate option for Indian firms.”

Basant says, "The results should benefit firms who wish to understand internationalization processes and researchers in this area.” Basant adds, "Firms can compete (internationalize) either through lower cost or better products or services. While the former is termed as low-cost strategy, the latter is known as differentiation strategy. Products or services can be better in terms of quality, product or service characteristics or features and branding. All the three may also be combined. R&D can help develop new features and advertising can be used to build a brand around it. If firms use both differentiation and low-cost strategy, it is known as hybrid strategy."

Differentiation strategies focus on dividing customers into various segments, based on some similarity. Here, a different strategy is employed for each customer segment with respect to products and services, as done by McDonalds. Low cost strategies usually employ mass production to reduce costs and do not focus on customer segmentation. They offer the same products and services to all customer groups.