Marketing and Branding Strategies of Consumer Durable Companies

Research Report
On
“ Marketing and Branding Strategies of
Consumer Durable Companies”
Submitted by-
T E CH NOL O G Y Aman Kumar
MARKETING AND BRANDING STRATEGIES OF CONSUMER DURABLE COMPANIES
ACKNOWLEDGEMENT
I would like to take this opportunity to thank the following
people who have directly or indirectly contributed towards
the completion of this dissertation and without their help
this in the present form would have not been possible.
I am thankful to Mrs. Jyoti Bhasin Sr. FacultyFDDI,
Noida for giving me opportunity to work on such a nice
project as my project. And last but not the least my special
thanks to my parents without their support my MBA course
would not have been possible.
Rishabh Bajpai
IILM Greater Noida 2

DECLARATION
I hereby declare that this project report entitled “ Marketing and Branding
Strategies of Consumer Durable Companies” is written and submitted by me
under the kind guidance of Mrs. Jyoti Bhasin.
The findings and interpretations in the report are based on both primary and
secondary data collection. This project is not copied from any source or other
project submitted for similar purpose.

Contents
Introduction
Industry Overview 7
History 8
Major Industries
Philips 14
Samsung 15
Videocon 15
Whirlpool 16
Hitachi
16
Electrolux 17
BPL 17
Onida 17
Comparison-Major Players
BPL
Products 20
Strategy 25
Distribution Network 40
Promotion Mix 42
Videocon
Products 46
Distribution Network
62
Promotion Mix 63
Samsung
Products 66
Marketing and Branding Strategies
An Overview 76
LG’s Strategy 78

Present Scenario and recent trends 82
Future prospects in Consumer Durable 87

Industry
SWOT Analysis 93
Conclusion 95
Recommendation 101
Bibliography 104

Introduction

INTRODUCTION
INDUSTRY OVERVIEW
The Consumer Durable industry is huge! Think of a typical day then
you wake up to make coffee that has been brewed by your-controlled
coffee maker. You pop a couple of slices of bread into your electric
toaster, grab some juice from the refrigerator and throw a load of
laundry into your washing machine. You dry your hair with your
electric hair dryer; brush your teeth with your electric toothbrush and
head of your job. At lunchtime, you prepare your lunch in the
microwave oven and then leave early to head homework in your yard
with your lawnmower, leaf blower and trimmer. Dinnertime means
your need to put that roasts in your electric oven, open a can of
vegetable with the electric can opener and mix up a cake with your
electric mixer. After the dishes have been put in the automatic
dishwasher, it is time to relax with the TV and VCR, but only after
you put the clothes into the dryer and iron the clothes you will need
for tomorrow. Time to set that timer on the coffee maker again and
prepare for a brand new morning! The number of household
appliances grows every year, but there is one sector of the industry,
the major appliance sector, that remains fairly constant. This is the
sector that I have chosen to analyze. The appliance that comprise

this sector re ranges, refrigerators, washers, dryers, and
dishwashers the SIC that relate to them are.
HISTORY
Home Appliances industry is one of the most lucrative and fast
growing industries. The Indian economy witnessed a proliferation of
global companies in the National Scene. Liberalization of Indian
economy coupled with the media explosion ushered in a new era of
consumerism. Increased purchasing power and a fluid taste led to
the creation of budding Home Appliances market. The growth rates
were as high as 22% in the white goods segment compared to a
merely 2-3% growth in the European and American market.
Home Appliances industry scenario in India is a totally
different from what it was one decade back. Consumer Industry
Scenario in India is totally different from what it is in European
Countries. Demand in developed countries is mainly constituted by
replacement demand white goods market in India was dominated by
indigenous industrial houses like Videocon, BPL, ONIDA, Kelvinator,
and many other, but the entrance of multinationals in Indian market
because of opening up of Indian economy gave these companies a
big blow. MNCs that are gaining good market share are Samsung,
LG, Electrux.

EMERGENCE OF CONSUMER DURABLE INDUSTRY
Indian Home Appliances industry is growing at an overall rate of 12-
13 percent. If we consumer each product market individually, the
Colour Television market has shown a growth rate of 25%.
Refrigerator market is growing at a rate of 8-10%. Reason for high
growth rate CTV market is that now a days TV is not used as a
source of entertainment but also source of knowledge and
education. All these factors act as accelerator. If we take the case
air conditioners, today air conditioner is not only refer to a cooling
machine but also an air fresher. In proportion to growing incidence
of working couples, refrigerators are gaining significance, more and
more as an instrument to store and recycle ready made victuals.
Inspite of many value added Service that are being offered by most
of the brand, the refrigerator market is still biting the dust.
Electronics is the fastest growing industry in India. In the liberalised
economic scenario, electronics has entered every walk of our lives
and has enhanced the quality of life that is enjoyed by the Indian
consumer. India is no longer a country, a market where the
consumer has to rely almost entirely on the influx of smuggled
electronic items to satisfy his needs. The Indian electronics industry
has thrown up competitive players who are not only able to cater to
the desires of the Indian consumer successfully, but have also

emerged as very successful exporters of electronic goods to the rest
of the world. This has all happened in the last 20 years or so. A
couple of decades ago, nobody in his widest dreams could have
imagined that consumer goods bearing Indian brands, built up
assiduously by Indian companies would come to dominate Indian
industry. There could have been two reasons for so little faith in
Indian goods. Firstly, the Indian public’s unhidden groups like BPL,
Videocon, Onida, that Indian brands now dominate the markets.
These corporate houses have upset the apple cart of foreign
companies by establishing Home Appliances manufacturing
companies that have not only consistently produced superior
products but have also created in a very short span, brand equities
capable of taking on international brands. That is, the Indian
consumer ’s perception of brands originating in his own backyard has
evolved from one of shame to one of trust, pride, identification, all of
which translate into patronage - or achievement of a company’s core
business objectives.
The Electronics industry is one of the bedrocks of global industrial
development. The electronics industry was for long the domain of
First World economics. The 1960’s saw a shift, with Japan’s
emergence. Subsequently Hong Kong, South Korea, Taiwan and
Singapore, then Brazil, India and Mexico followed of late by China,
Indonesia, Malaysia, Philippines and Thailand have entered the fray.

After economic liberalisation our country lowered entry barriers and
brought global companies into the country’s marketplace, it was
realized that the core of the corporate world must change, to focus,
the first time ever in India, on the consumer. And to stop chasing
revenues, profits and market shares, which will flow only from the
new consumer competence. Forget too, forever, the silent consumer
who, before of alternatives, uncomplainingly bought whatever
products were made available. In today’s and tomorrow’s new
unforgiving marketplace it is the choice - empowered consumer who
will decide the fate of the corporations.
And competition, global quality and new economic realities are
conspiring to limit success only companies that are focused
completely on their consumer. For, only these companies and
continuously monitor and meet changing consumer needs:
streamline processes; cut costs and restructure for quicker response
to the consumer ’s demands. All of which will add up to an
unmatched competitive edge, enabling them to conquer tomorrow’s
marketplace today. However, the consumers and spending wisely not
indiscriminately. Changing personal, social, familial and cultural
influences - for instance, the advent of satellite TV, internet and the
information age bringing with them rich, real - time images and data
about global lifestyle- have made the consumer an individualistic,
iconoclastic and irreverent wielder authority over the fate of

corporate’ attempts to fulfil their needs. Which is why in this new
buyer ’s market, the marketer has not choice but no make the
consumer his lodestar.

Major
Industries

MAJOR INDUSTRIES
Trends affecting the Consumer Durable industry
The booming economy gives consumers more real disposable
income, which has increase since 2004. This is an important factor
in major appliance sales as it is estimated that U.S. consumers
spend about 50 cents of every $100 on major appliances. The
economy also does well for consumer loans. In good times,
consumers are less afraid to borrow money for major purchases,
and as appliances. Many may even decide to but while the
economy is good, rather than waiting until they are forced to make
a purchase when an appliance wears out.
Changing demographics will play a significant role in the major
appliance market over the next few years. The baby boom
generation will be in the 35-to-55 age group during the next 5 years.
Household headed by consumers in this age range are in their prime
earning years and tend to spend more on household durables than
any other age group.
Philips India
Philips is one of the oldest multinationals to enter India nearly 60
years ago. Philips has had a fairly successful run as a major player
in the television market. The company has identified domestic

Electronics, personal computers and monitors, software as its target
business. In the year ending Dec’05 Philips India has notched up
sales of Rs. 1683 crore.
Samsung Electronics
Samsung electronics, entered India with a stake of $ 5 million in the
India subsidiary Samsung India electronics Ltd., in which it holds a
51 per cent controlling share. The product portfolio of Samsung
Electrons ranges from Multimedia products, home Electronics and
telecommunication product systems.
In India the company has established a leadership position in the
product categories in Home Electronics 440 watts Mixer Grinder CD
based systems, washing machines, microwave over and VCD’s. In
2004 it had a market share of 8%. The company has a
manufacturing facility for home appliance at the Noida complex. This
facility has a production capacity of 50,000 units each for
refrigerator and washing machines.
Videocon
Videocon International Ltd., company having a market share of
14.1% in the Home Electronics market . Estimated to be among the
top three companies in the country in the Home Electronics, Citrus
Juicer and Mixer Grinder segment VIL is now up against major
international brands which have entered India. In 2004, it had tied

up with Toshiba for the marketing of the premium 16.9 double
window Home Electronics Costing about Rs. 1.9 lacs.
The market share in 2004 were :
Home Electronics’s 18%; refrigerator 11%; Citrus Juicer 32.7%; air
conditioner 12.7%.
Whirlpool
This company invested in India in 1987 beginning with the venture
with TVS private limited. In 1994, TVS Whirlpool Ltd. changed its
name to Whirlpool Citrus Juicer Ltd. Its dominance is mainly in the
white goods industry. It 1995 Whirlpool required controlling interest
in Kelvinators of India, one of country largest manufacturing and
marketer of refrigerators. Its market shares in 2001 were; Mixer
Grinder 19.3%; Citrus Juicer 14.6%.
Amtrex Hitachi
It has strategic alliance with Hitachi Ltd., of Japan. It entered white
and brown goods market in India few years back and is aiming at a
market share growth by 16%. It is majorily into the marketing of high
end AC’s each in split and windows segment. Its market shares in
2004 were : air conditioner 13%.

ELECTROLUX
AB Electrolux, reached an agreement to obtain majority ownership in
an Indian Citrus Juicer manufacturer, Intron Ltd. Electrolux invested
US $ 2.4 million in the step to obtain 51% ownership in Intron Ltd. In
1995 it took majority control of Maharaja Int’l Ltd., an Indian
refrigerator manufacturer. With these two manufacturing bases it
even has 40% stake in Eureka Forbes Electrolux
The company has presence mainly in the refrigerator and Citrus
Juicer segment. It has been launching world class products in India
at regular intervals. 2002 witnessed the launch of seven upgraded
world class models of Kelvinator refrigerator. In 2003 it launched
premium Gold collection from Kelvinator. Market shares in 2005
were : refrigerator 13.7%.
BPL
BPL Group was promoted by the founder, TPG Nambiar. The flagship company,
BPL Limited was incorporated in 1963 as a private limited company under the
name British Physical Laboratories India Private Limited for the manufacture of
electronic test and measuring instruments in collaboration with BPL Instruments
Ltd. UK. The company further expanded into such electronic products as medical
systems and equipments, power line carrier communication equipments, copiers,
monitors etc. Making its foray into consumer electronics in 1982, BPL quickly
established itself as one of India’s most trusted consumer durable brands. Huge

investment in manufacturing, marketing & distribution infrastructure, and brand
building have made BPL a trusted name in the consumer durable industry. BPL
today enjoys one of the highest brand awareness amongst consumer electronics
brands and also has one of the highest preference shares in the CTV industry.
BPL is currently engaged in the production and sales of televisions, home theatre
systems, medical equipment, automotive parts, electronic components and
alkaline batteries.
20%
6%
61% 13%
Onida BPL Videocon Others
Market Share-CTV
8%
6%
18%
68%
Market Share-Washing Machine

COMPARISON MAJOR PLAYERS
BRITISH PHYSICAL LABORATORIES LTD.( BPL )
INTRODUCTION
BPL Home Appliances Limited is the Flagship Company of the 4600
cr. BPL Group is India’s largest consumer electronics conglomerate.
The group has a long-standing strategic alliance with Sanyo (Japan)
for a variety of consumer durables. BPL Limited has a principal
presence in the manufacture and the sale of Colour TV sets. The
company also produces black and white TV sets, alkaline batteries
and gas tables.
BPL Group was incorporated in 1963 and started manufacturing
hermetically sealed panel meters for defense and subsequently
diversified into medical instruments. In 1970, with technical
collaboration with Siemens and ITT, BPL began manufacturing
professional grade relays and switches and later expanded into
manufacture of power line carrier communication equipment for the
government of India. In 1982, BPL group grew steadily in the fields
of medical instrumentation, communication and power systems
largely due to a reputed in-house R&D facility and component
development center for in-house requirements. BPL witnessed a new
era in 1982-83 with group’s entry into Consumer Electronics and
with formal technical collaboration with Sanyo Electric Company,

Japan. Since then the growth has been phenomenal with sales
turnover nearing US $ 900 MN in 2004 to 2005.
To combat competitive pressures, the company launched the latest
models in the market and went in for heavy advertising to maintain
its leadership in the market for a quality product company from its
earlier image of medical equipment company.
Sensing the consumer electronic industry is going to be fiercely,
competitive in the years to come and growth rate will slow down,
BPL is diversified itself into other industries like power and cell
phone networks. Both of these are unrelated diversifications for the
group and group resources are stretched to the limit as both the
segments entail heavy investments.
BPL GROUP
Mission Statement
BPL is committed to achieve a leadership position in all its business
group through utilisation of the best and most appropriate
technologies, applying the finest manufacturing disciplines and most
efficiently marketing high quality products and services to
consistently give its customers the best value for their money.
Objectives of the Company
 To ensure customer confidence through product quality, efficient
marketing and effective service.

 To continually enhance the Company’s growth to its shareholders
and investors through sound investments and profitable
operations.
 To demonstrate a real concern for its employees and constantly
improve the quality and value of their jobs and career
advancement.
 To be a good corporate citizen who contributes positively to its
community by protecting the environment and working for public
welfare.
 To respect the laws, rules and customs of the land and to ensure
the conduct of all company activities will always be to the highest
ethical standards.
BPL HOME APPLIANCES ITEMS
Consumer Electronics - Televisions
A wide range both in Colour and in Black and White, Catering to
individual customer needs in terms of features, looks and styling
housed in fully molded plastic cabinets and incorporating critical
components manufactured in technical collaboration with Sanyo of
Japan, BPL Television are leaders in the market-in quality and in
performance.]
CURRENT MARKETING & BRANDING PLAN OF BPL LTD.

The group has always been seen as an electronics engineering
group, unlike many of its competitors. Today it makes everything
from the cabinet to the electronic tuner itself and buys the picture
tubes from Indian supplier. This in itself is seen as a transition of
BPL from an engineering group to more diversified group dealing
right from consumer electronics to cellular services which in short
span of time the group ha achieved with tremendous success. The
BPL group is lot shy, introverted, but excited about the quality of its
products. It is not surprising that over the past years, the group has
quietly set in motion a wide ranging, strategic plan to establish itself
as the undisputed leader in consumer electronics. Over the last
couple of years BPL has introduced a stunning array of new
products; washing machines, vacuum cleaners, refrigerators,
microwave ovens. In audio, it has widened its range dramatically.
Soon to come gas stoves with built –in –lighters, mixer-grinders,
mineral water machines. In just 10 years, sales have zoomed from
Rs. 19 crores to Rs. 1000 crore. BPL in the field of colour TVs has
left behind old time rivals Videocon & Onida . In audio segment the
sales of BPL is second only to PHILIPS who is the market leader. In
VCD, BPL SANYO was the market leader with a 17 percent share of
Indian made machines.. In color TV components, the group has 65
percent of the market for electronic tuners., flyback transformers
and deflection yokes, supplying to many of its competitors. In

medical electronics, it has 60 percent of the electronic tuners,
flyback transformers and deflection yokes, supplying to many of its
competitors. In medical electronics, it has 55 percent of the
electrocardiogram market and 50-60 percent of the ICU monitor
market. In the Epbaxs, the group has the largest user base in the
country. Some conservative and shy which now to a large extent
has been able shed its image to largely because of the involvement
of BIG B in the advertisement which in itself was seen as mega coup
or event.
BPL has always invested money first into factories and then into
marketing. The group has high belief in vertical integration, which
shows the confidence of the company which takes pride a in work
and that belief is reflected prominently in the advertisement as
BELIEVE IN THE BEST. The group believes in using engineering
superiority to offer the best, trouble – free products in the market
place. Stress consumer pull, not dealer push. In the long run, this is
the most profitable route of everyone manufacturer, dealer,
consumer.
Smoother the competition with range as it keeps both the consumer
and dealer happy. It uses the top-of-the-line products to gain
attention. The rub-of on the entire range down the line will work
wonders. BPL is also running dealer promotion schemes but not to
the extent their competitors indulge instead they believe more on

advertising due to the fact that if the promotional spend crosses and
spend that means they are cutting their brand in the long run. So for
dealer they look at high margins trouble free performance so the
customer won’t hassle him and a constant flow of new products on
all factors BPL has got its act together. BPL’s range strategy works
on two levels. At the first one, the group is pushing into every
consumer durable category in an attempt to create an all-
encompassing umbrella brand much like those of leading Japanese
companies. It is selecting dealer showrooms at price locations
across the country and turning them into BPL Galleries that stock
and display only and all BPL products. The main objective of the
BPL Galleries is to show the public the width of BPL’s product range,
build corporate image and sales. The second level of BPL’s range
strategy is most obvious in the Rs. 1,500 crore audio market. The
one with Rs. 1500-3000 stereo portable segment (popularly known
as two-in-ones) will become the largest segment volume wise
overtaking mono portable.
The BPL group is slowly moving away from its core areas of
entertainment electronics and consumer durable. But not all its
diversification have been successful. It was this same tenacity that
helped the BPL group float a high-technology company in a very
short time. BPL Mobile, one of the cellular service providers in
Bombay, stands out for jumping into the fray without any foreign

partner. BPL Mobile and simultaneous diversification’s into the
power skills of it’s the BPL group’s attempt to move away from the
highly competitive entertainment electronics sector, its mainstay all
along. They have entered power sector because of its high entry
barriers for smaller players. Since telecom and power are high
turnover areas the dependence on entertainment electronics will
reduce but very gradually. The various companies are in six main
areas of operations entertainment electronics, appliances, telecom,
power, electronics and TV components and international operations.
STRATEGY
Faced with a market where products are converging on the
technology front, BPL’s strategy to zero in on two critical
differentiates; brand building and cost leadership. Together, this is
expected to deliver the ultimate strategic weapon, value.
Differentiation : last four years along, the BPL group has splurged
Rs.214 crore on advertising campaign. To good effect. A recent
survey by the Bangalore – based market research firm, Gallup MBA
India, reveals that BPL is the sixth –most popular in the country
today. Not surprisingly, the group has valued the BPL brand at Rs.
611 crore. According to Trisys Research, the marketing consultancy
company, which did the valuation for BPL: The huge amount of
money spent by the group in strengthening its brand must be seen

as an investment and insurance. Investment because this will drive
future sales, and insurance because the strong brand is expected to
keep the competition at bay and protect BPL’s earnings in the
process.
To small extent has that helped BPL actually expand its CTV market
share in the fact of transnational competition. In 2002-03, when the
consumer electronics industry reported stagnant sales BPL’s CTV
sales grew by 15 per cent. But BPL did not have a straightforward
brand positioning strategy. On the other, to effectively set itself
apart as an Indian electronics major capable of being on its own.
BPL cannot afford to overplay the Sanyo part. In fact, the entire
strategy revolves around positioning BPL as the best India has to
offer. Hence the choice of Amitabh Bachchan, and signature line,
Believe in The best. The campaign conveys on clear message: any
BPL product you pick up is the best in terms of quality, technology
and value for money.
Technology Leadership : Underscoring the differentiation strategy
is, of course, BPL’s technology leadership. While an annual R&D
budget or Rs. 6.45 crore in 2004-05 ford not show great commitment
to R&D, that hasn’t stopped it from shopping for technology to keep
pace with market demand. For instance, the group’s first venture
into instrumentation came in the wake of a technology partnership
with British Physical Laboratories of the UK. The foray into

consumer electronics in 1982, and subsequently, into the domestic
appliances segment was driven by a tie-up with Sanyo Electric, and
the proposed colour picture tube plant will be set up in technological
collaboration with the $ 48.41 billion Toshiba Corp. of Japan. Once it
enters a segment, the group makes it a point to quickly broad base
its product portfolio.
Economies of Scale : Behind BPL’s high,. Market presence in
consumer electronics are two critical factors: Its global – scale
manufacturing and high vertical integration. In CTVs. Which
contributes 29 per cent of the five listed companies sales of $3,102
crore, BPL has consolidated capacities under the flagship BPL Ltd.
Besides the total capacity has been expanded from 8.30 lakhs CTV s
a year to 10.30 lakhs, and BPL plans to double it. If scale economies
lowers per unit cost, BPL’s high degree of vertical integration
enables it to attain higher value addition for every rupee of sales;
the group manufactures most critical components – like deflection
yokes, transformers, and tuners- in house. In 2002, in partnership
with Videocon, it took over the Uttar Pradesh governments ailing
colour picture tube manufacturing facility, Uptron, under a
rehabilitation package formulated by the Board for industrial and
Financial Reconstruction. The unit, which was set up in technical
collaboration with Toshiba in 1989, has already been refurbished
and put on stream. The effect of BPL’s cost management is evident

in 2003-04 despite a high interest burden and the large discounts
offered to the consumers, the average margin on CTVs went up by
Rs. 450.
Business Portfolio
Clearly, the groups cash-cow is its TV business, which contributes
33 per cent of its sales. According to MARG-ORG, the market
research firm, BPL has a market share of 19 per cent. For at least
three to four more years, CTVs will continue to drive BPL’s revenues
and earnings. Efforts have been made within the company to
improve its distribution network and systems with a view to achieve
improvement of quality and they have also effected a reorganization
of markets and distribution teams of its various group companies by
building a central marketing organisation which ensures that the
company continues to react fast to changing market conditions. This
re-organisation was completed in March 03.
THE 4Ps
PRODUCT ANALYSIS – CTV’S
Colour televisions account for 37% of all TV sets sold in India , 21”
CTV is the largest selling product in CTV’s. At present the market is
in a growth stage and currently there is a boom in the market. BPL is
producing expected products which has a set of attributes and
conditions that buyers normally expect and agree to when they
purchase a product. In this category BPL offers features such as 150

programs (channels), Cable readiness, Bass expander, Child locking
and a host of others. But of late, it has started making Augmented
products that meets the customers desires beyond their
expectations. The up gradation of product quality is through
digitalization and accordingly the company is coming out with a
range of high end digital products like digital camera, digital home
theater systems and digital versatile disc player. In the television
industry, it is the product, which drives the brand. BPL is launching
new products to widen its product mix. BPL is lengthening its
product line of CTV’s by adding more items within the line’s present
range.

HOME APPLIANCES PRODUCTS
Product Range
Product Specifications
BPL LER Specifications
Price Rs (MRP) 13900

Brand BPL
Screen Size (Inches) 20
Type of Screen STD
Sound Output (Watts) 125
Child Lock YES
Remote YES
Channel Scan YES
Sound Quality STEREO
Auto Volume Leveller YES
Multi Language OSD Menu No
Warranty Years 1
BPL KTR Specifications

Price Rs (MRP) 7690

Brand BPL
Type of Screen STD
Child Lock YES
Remote YES
Channel Scan No
Sound Quality MONO
Auto Volume Leveller No
Warranty Years 1

BPL FHR Specifications
Price Rs (MRP) NA
Brand BPL
Type of Screen FFST
Child Lock YES
Remote YES
Channel Scan YES
Warranty Years 1
BPL EMPEROR II Specifications


Brand BPL
Type of Screen SUPER FLAT
Child Lock YES
Remote YES
Channel Scan YES
Warranty Years 1

BPL NSR-29 Specifications

Brand BPL
Type of Screen SUPER FLAT
Child Lock YES
Remote YES
Channel Scan YES
Warranty Years 1

BPL NEPTUNE Specifications

Brand BPL
Type of Screen FFST
Child Lock YES
Remote YES
Channel Scan YES
Warranty Years 1
CATEGO Models Price Range Segment

RY Share
14” KSR 14 KTR14 Rs. 8900-9900 16%
20” LCR 20 LVR 20 Rs. 11900- 41%

15400
21” FPR 21, FWR 21, FDR Rs. 13500- 38%
21, FQR 21, FTR 21, 19000
FHR 21, FXR 21.
25” BXR 25 BQUR 25G Rs. 20000- 5%
22500
19” NQR 29 NQR 29 PS Rs. 27000- 1%
29900
BPL has also introduced the concept of line featuring by promoting
low-end promotional models to serve as traffic builders to attract
new buyers.
The other big factor in the 21” segment is the gradual shift to the
F&FST (full and flat square tube), which allows for better viewing.
India is expected to go the way of the rest of the world which prefers
F&FST. MNC’s have been promoting F&FST in a big way because
the margins are higher there. Even as more consumers are willing to
write out big cheques for feature packed TV sets, enormous
potential is crystallizing below. In the market called India, the best
and the obsolete products both can sell side by side in substantial
numbers.

Washing Machine
BPL ABS45D Specifications

Brand BPL
Type FULLY AUTO
Loading Top
Size(Kgs) 4.5
Hot water Option No
Self Timer YES
Preset washes No
Detergent Dispenser No
Digital Controls YES
Rat Mesh YES
Warranty(Years) 2
Castors No
BPL ABS 45 DELUXE (4.5 Kg)
Other Features:
 Approx. Price Rs. 12,327
 Fully automatic
 Top Loading

 Quiet operation
 Perfect water control
 Auto softener dispenser
 Safety device to prevent over heating
Pros: Price, performance, low electricity consumption,
Cons: No hot water wash.
BPL ABS 45 SD (4.5 Kg)
Other Features:
 Top Loading
 Quiet operation
 Auto softener dispenser
 Safety device to prevent over heating
 Cycle end buzzer

BPL Distribution network
BPL Factory
Branch Towns/C&F
Distributors
BPL Galleries Direct Dealers

Retailers
Customers
BPL has about 8000 dealers all over India. It regularly conducts
dealers meets to tell them about its new product and future plans.
The latest being Techno Summit ’03 held in month of December. The
meet was held in the cities of Bagalore, Hyderabad, Calcutta,
Chennai, New Delhi, Kochi and Lucknow.
PRICING OF COLOUR TV’S
The demand for CTVs is sensitive to its pricing. With a little
reduction in prices the demand shoots up rapidly. The major barrier
to penetration and market expansion has been the high price in
relation to purchasing power of an average Indian. In order to price
open and expand the market, manufacturers are bout to adopt
strategies to lower prices. BPL has been affected by price cuts of its
competitors with its market share falling to 22% at present. Within
the new price paradigm a brand such as BPL would continue to
command a premium over other brands, due to a higher perceived
quality and the brand values it enjoys. BPL went for quite a few
promotional schemes last year. Regularly dropping prices create a
dissatisfaction among the consumers who have bought the same
CTV Model earlier.

CTVs value and price are currently perceived in 30/70 ratio which
means that Indian consumers still go for the lower priced versions,
or atleast a majority of them. BPL has priced its products in such a
way that it can cater to all category of buyers. The company has
been very aggressive in its pricing which has led to a sales strategy
of receiving 100% advance payment from its dealers and giving its
dealers a margins of about 10% on the MRP. Though the effective
margin received by the dealers is effectively the lowest for BPL
CTV’s , yet it gives them higher turnover which ultimately leads to
higher profits. Recently three successful pricing strategies which
received overwhelming consumer response were:
 Financing at 0% rate of interest
 No profit No loss sale scheme for its best dealers in Delhi.
 Attractive price reduction due to in-house development of some
components.
CTV industry is witnessing a general trend towards lower prices.
New CTV sets come cheap, thanks to exchange meals and easy
finance offered by leasing CTV manufactures. Pricing of CTV’s is
done more on values perceived by the customer and less on cost
plus markup basis.

BPL is trying to reduce costs as a result of concentrated effort by
the company’s designers, engineers and vendors to reduce them. It
is using optional feature pricing, special event pricing and low
interest financing as forms of promotional pricing.
PROMOTION MIX
The increasing competition in colour television industry has forced
the marketers to go for innovative promotional schemes. The total
amount to be spent on advertising and promotion by BPL is Rs. 310
crore this year. It spent Rs. 240 crore in 2003.
BPL relies more on consumer pull type of promotional strategy. The
effectiveness i.e. balance of push vs pull tends to vary across
regions in India. In consumer electronics industry, the north and
west are seen to respond more to push and the east and south are
comparatively brand loyal. As competition heightens, companies are
being compelled to continually widen their product range. Their
investment in tools, used to make dies and kits of CTVs, are rising,
BPL launches four to five models each year. They have five tools
and each tool costs Rs. 5 crore to set up. The brand building activity
has become important for all the companies and this basically to
keep themselves updated with consumers perception of a particular
brand.

BPL has around 160 exclusive showrooms at prime locations across
the country called BPL galleries that stock and display only BPL
products. The main objective of BPL galleries is to show the public
the width of BPL’s product range, build corporate image and sales.
BPL had announced end of its multi-crore association with Amitabh
Bachchan in 2003 since his popularity is on a down swing in TV
commercials and media campaigns, especially in metros and urban
centers. Currently BPL is using Amitabh Bachchan only for its rural
marketing campaigns. BPL will also exit from niche programs like
BPL Oye, the popular Hindi film song countdown show on Channel V
due to the fact that it has been unable to qualitatively differentiate
from competition and retain edge in this genre of progamming. It is
trying to build an emotional bond with consumers. It moved to
establish a bond with the younger generation the key to future
market lay in tying the brand in inextricably with entertainment. The
commercial inspired by the blockbuster movie, ‘Home Alone’ evoked
sympathies (thanks to the kid) and warmed its way inside every
families heart BPL is projecting itself as a company many
advertising entertainment products.
BPL has decided to capitalise on India’s near – religious fever for
the game and get into cricket – related sponsorship in a big way in
the Cricket World Cup in2003. BPL has also launched its Player –

of-The –Week program for international cricketers on which it is
spending Rs. 2.56 crore.
Competitors: Samsung has announced that it would significantly
increase its advertisement and promotion spending and have new
promotions during the forthcoming Cricket World Cup Phillips is also
focussing on brand building riding on the back of the youthful image
them and offering the latest technology products at competitive
price. Akai is offering various exchange schemes to boost its sales.
In last 2 years it had come out with more than 11 such schemes.
ANALYSIS
It is the tendency of company to acquire a major share in the
market. Now question arises how to achieve it ?
Any consumerable product that has been launched in the market to
face competitions, whether it is Videocon International, Daewoo or

BPL all have to face neck to neck competition. In the company
during Deewali festival, all the companies are engaged in evolving
technologies to attract the customers. Even they are ready to
sponsor the national and international games. Recently Companies
like BPL and Videocon have announced an average of its
advertisement and promotional spending.
VIDEOCON INTERNATIONAL LIMITED
Introduction
Videocon international Ltd (VIL), the flagship company of the
Videocon Group is a leading producer of television sets, audio and
video systems, Aggressive marketing, launch of international quality
goods at lower prices, and a strong distribution network have made
Videocon a household name. It enjoys 27% market share in colour
TV.

During Fy03-04, Videocon Narmada Electronics, a group company
engaged in the manufacture of picture tubes was merged with the
company. The merger will result in backward integration benefits for
videocon.
Videocon has tied up with international giants like Sansui for middle
range audio products, Toshiba for CTVs and VCD Players. Videocon
has also announced a tie-up with kenwood Corp., Japan to
manufacture and market Kenwood’s premium range of audio
products in India. The company faces a stiff competition following
the entry of international leaders like Sony, Akai, Samsung, and
Panasonic into the Indian markets.
Videocon’s proposed diversification into unrelated areas like
construction, power generation, oil extraction, and petrochemicals
have been shelved following a cash crunch within the group.
Videocon, however has focussed only on its core business of
consumer electronics.
Videocon keeps in touch with the times, to ensure that the
customers stay ahead over the years, Videocon has offered state-of-
the-art technology and international quality with venavkable
consistency. Now it has a host of innovative products like the
Plasma TV, the WebTV, Degital Video Disc, Double cascade washing
machine, combi refrigerator, the dishwasher - which are bond to
revolutionize the life style.

Videocon has always, and will always push the frontiers of
technology to give products that improve the quality of your life. No
wonder, it enjoys the trust and confidence of millions of satisfied
customers.
Videocon has a strong commitment spanning the rapidly surging are
of Business Electronics. It aims to revolutionize the corporate world
by launching products that lend the cutting edge to business
professionals. And help them be ready for the various challenges
that the arena of modern business demands Videocon has got
together with leading organisations in the world with an unfaltering
dedication of bringing only the best to be customers.
Videocon was a relatively new entrant to the TV market as compared
to others. Still, it managed to carve out a significant share of the
market by essentially utilising two tactics. One, it managed to sell
cheaply playing on volumes and second, it outsourced many of the
appliances it sold and managed to get long tax brakes on its
manufacturing units locations because of the groups political
connections.
These strategies paid rich dividends in the price sensitive domestic
market, and the company managed to carve out significant shares in
most of the consumer durables segments. But as the market opened
and became technologically driven, Videocon’s image of being a low
cost supplier became its bane, as the consumer normally associates

price with quality. Thus, it lost its leadership in the CTV market to
BPL which was associated more with quality than Videocon.
VIDEOCON - MISSION AND OBJECTIVE
Leadership
Through
technology
innovation
quality
performance
India Today, the world tomorrow
The Videocon symbol. It reiterates the ethos of a company dedicated
to maintaining the highest international standards of excellence
through quality, technology and innovation. For over a decade now,
Videocon has been bringing the latest and very best in Consumer
Electronics and Home Appliances. Successfully adapting the best of
technology to suit. Indian needs and crafting it to improve quality of
life –
The new Symbol of Videocon asserts its passion for global impact,
and the two ‘E’s on other side represent to group’s wide spectrum of
interests ranging from ‘Electronics to Energy’. A symbol that
proclaims a paradigm shift. A sign that represents the new force that

is Videocon. Thus recapitulating own principle of reaching out and
touching the time of millions of people worldwide.
THE COMPANY STATUS : ITS PENETRATION IN THE MARKET
Business for Videocon International Ltd. (VIL) has always been a
game of growth through rapid widening of the field of opportunity.
While training out wide and penetrating India to the deepest possible
depths was once the natural future course for this distribution driven
company, now it is an imperative and it involves every department
including R&D.
Videocon believes that they are the leaders in their respective
product categories, But growth made a minor come-back in 2003-04
thanks to the buoyant CTV market with VIL’s turnover rising by 23%.
In 2004-05 its turnover increased by 12%.
Videocon has how diversified itself into power, petroleum,
information technology and Real estate.
Videocon doesn’t consider competition as a weakness according to
it, it is the dominant brand that gets affected by the entry of new
comes – That’s the reason they were not surprised when their CTV
share slipped. They were anticipating it. Videocon has been
describing itself as a leader over. the years. Having established

itself as a powerful brand. It has launched many sub-brands catering
to defined market segments.
They have ‘Bazooka’ for the Top-end of the market. For the middle
they have ‘Turbo-tough ‘ and finally for the younger consumers,
they have the 14” Private. The image Videocon is of as aggressive
technological leader it was the 1 s t brand to launch PIP, Surround
sound and now Bazooka Videocon is using its brand equity built over
the years to help its sub-brands.
All Videocon’s products are manufactured in India, The company’s
state of art plants. The level of automation in Videocon plants is
comparable to the best plants in the world. The company entered
into technical collaborations with various internationally renowned
MNC’s for its wide products. This collaboration could be further
straightened to maintain Videocon’s, leadership position as well as
take care of the new brands being introduced in the market.
As for as a consumer is concerned. There is no difference between a
Sony made in India and a Videocon made in India.
In the big cities Videocon is making first enough efforts to hang on
its current market share. The number it wants will come from
products designed specifically for low end use.

Videocon downs to be far ahead particularly on engineering products
to suit localized needs. Videocon says that the stripping – down job
has to be acutely market sensitive. So it has got a fix on small town
value perceptions and cut-down those features deemed irrelevant.
According to Videocon - Satellite TV’s bringing new complexities to
demand patterns.
Five years ago – small towns accounted for first 1% of the brands
CTV volumes now the proportion stands at over 17%. The upshot;
higher price realizations. Dealer margins and sundry selling costs
are lower in small towns, so VLL gees a layer fraction of the price
the consumer pays. This is one reason that the strategy is sound at
least from a medium – term point of view. According to Videocon
competition, is less severe further down the town hierarchy – so
more in smaller towns – the higher is the profitability, better
margins, better logistics and costs.
It could be ages before everyone is ready to buy a TV.
Videocon is also trying to break new ground with refrigerators and
washing machines by playing the "price – point game"
Videocon believes that strictly geographical urban – rural divisions
are unrealistic in a country where lifestyles are so disparate. For

Videocon its not geographical any more but a function of socio-
economic behaviours.
Videocon had started selling Toshiba and Sansui as premium CTV
brands – while Sansui flanks Videocon, the brand Toshiba will
spearhead the company’s projection of quality.
Needles to say, Videocon is banking heavily on efficient operations,
with money being purified mainly into things which deliver results, to
maintain the price advantage it enjoys in so many markets. Better
computer software is another big help. The company invested Rs. 60
crores on software in 2005.
Domestically, by 2005-06, the company expects to be selling 16
million CTVs. But, by seeing the commanding heights the consumer
electronic business it wants its annual capacity of CTV to be 3.5
millions.

Every Where and For Every body .
THE 4 P’S
Product analysis/Price analysis
CATEGORY Model Price

36 cm 3651 R 11,490
3609 R 9,990
3617 R 8,990
51 cm 5122R 13,990
5120R 11,990
53 cm 5414R 20,490
5420 R 16,990
7501 33,990

Features of Videocon 25 Bazooka Boss (6400R)
 86 Program Auto Search Memory
 Computer Controlled self Demonstration
 Flat & Fruit square Tube
 Cable Ready- Hyper Band Toner
 Bazooka Worfee
 200 W PMPO
 CD Comparable
 Child lock
 Channel Scan
Bazooka Impact (5414 R)
 100 programs auto search memory
 personal Preference on each of 100 programs
 Flat and Full square Tube
 Computer controlled self demonstration

 Table ready – S & Hypes band Tuner
 Bazooka Woofer
 200 W PMPO Sound output
 CD Compatible
 Child lock
 Channel Scan
Right from the start, Videocon has endeavored to enhance the
quality of life. Breaking new grounds innovating. Exploring the
worlds most advanced technologies to give the customer the finest
product.
Videocon - Truly the pioneers in taking technology to Indian homes.
Videocon has a lot of ‘Firsts’. to it’s credit like India’s first
Television with PIP (Picture in Picture, FSFT Hill flat square Tube),
Surround sound and also the Bazooka Technology
As far as the pricing policy of Videocon is considered, Initially the
policy adopted by Videocon was to sell cheaply which paid rich
returns in the price sensitive domestic market. But now where
consumers are no longer price sensitive – The market is more
technologically driven. They have started associating price with
quality and started considering Videocon’s product as low quality.

This was the 1st step and company started launching good
technologically product’s which were highly priced – and took
collaboration to launch foreign brand names in the higher segment
of the society and keeping its image as it was for the price sensitive
customer
 Exchange offers, schemes, gifts were some of the promotional
tools adopted by Videocon
 As well as financing schemes and good dealer margins.
Price
Model Name Description
(Rs.)
VIDEOCON,fully auto,top
V-NA-65 NF loading,6.5 (Kgs),Hot water 16990
Option,Self Timer
V-P-1000 AFDC 29990
loading,10 (Kgs),Self Timer
1211 16400
loading,4.5 (Kgs),Self Timer
VIDEOCON,fully auto,top loading,6
V-P-0600 AF 19990
(Kgs),Self Timer
V-P-45 FDX 12290
loading,4.5 (Kgs),Self Timer
VIDEOCON,semi auto,top
V-P-55 BT 8990
loading,5.2 (Kgs)
VEDEOCON,semi auto,top
V-NA-70 TS 8990


V-NA-911 F 12490
(Kgs),Self Timer
V-P-0700 AF 23990
(Kgs),Self Timer
VEDEOCON,semi auto,top
V-NA-550 TDX 8690
V-NA-35 TDX 5490
V-NA-550 T 8690
loading,5 (Kgs)
VIDEOCON 45 FDX (4Kgs)
Other Features:
 Approx. Price Rs. 12.990
 Fully automatic
 Top Loading
 Capacity 4 Kg
 6 wash programmes
 Auto soak
 Stainless steel drum
VIDEOCON 50 T
Other Features:
 Semi automatic

 Top Loading
VIDEOCON 55 F
Other Features:
 Fully automatic
 Top Loading
VIDEOCON 55 TDX
Other Features:
 Semi automatic
 Top Loading
VIDEOCON 60 BT
Other Features:
 Semi automatic
 Top Loading

Videocon V-NA-65 NF Specifications

Brand VIDEOCON
Type FULLY AUTO
Loading TOP
Size(Kgs) 6.5
Hot water Option YES
Self Timer YES
Preset washes YES
Detergent Dispenser YES
Rat Mesh No
Warranty(Years) 2
Castors YES

Videocon V-P-1000 AFDC Specifications

Brand VIDEOCON
Type FULLY AUTO
Loading TOP
Size(Kgs) 10
Hot water Option No
Self Timer YES
Preset washes YES
Detergent Dispenser YES
Rat Mesh YES
Warranty(Years) 2
Castors YES

Distribution
Videocon has a network of over 4000 dealers, backed by over 80
service centres all are India, equipped with the latest technology
and manned by skilled techniques trained as per international
norms.
DISTRIBUTION NETWORK
Factory
Distributors
Retailers Videocon Direct

Plaza Dealer
s
Consumers

PROMOTION
As competition increases, companies are forced to continually
increase their product range with an increase in the number of sub-
brands and continuously advertise and promote their product so it
reaches to the right customers. Therefore it has forced the
marketers or the producers to go in for new promotional schemes
and incentives which might look attractive to the buyers.
Few years back, Videocon was Okay with umbrella brand
advertising, with the spotlight on CTV’s .
Videocon created sub-brands such as Bazooka, Challenger,
Budgeting and Freedom and the communication went from “generic
to specific” it happened with all the product categories and
according to the company, it was the first to take a lead. Though
there was sub-brands – ‘innovation’ and ‘technology’ were to remain
the two key factors in accentuating the overall brand image.
In CTV’s Bazooka’s campaign plays on sound quality. Private – the
14-inch CTV is aimed at young people who want their own CTV sets.

Videocon’s urban advertising continues to build brand values for the
products, and dealers are offered mega incentives.-They were
offered Mercedes car and foreign trips in 2004-05
But Videocon was drawn into promotions ring to . In March 2004 it
launched its ‘Money – back offer ’ a unique scheme for the 21-inch
Bazooka (Rs. 14,990) and the 14-inch private (Rs. 5,990), through
which Videocon promises to return the entire money in six –years for
Bazooka and 5 years for the other two.
Earlier in 2004, Videocon learnt from bankers that individuals were
stashing away large sums of money in banks. A qualitative study
confirmed suspicion that much money was being saved to make big-
ticket purchases later. Replacement market buyers are all the more
on with postponement. So a “reverse – credit” scheme was devised
to get that money out of the bank on the assured that the money
would be returned later. Effectively VIL has taken loans from
customers and paid all the interest in kind (CTV’s) straightaway.
Though Videocon is heavily into advertising but it is not into
celebrity advertising like BPL is but still it has left an impact on the
consumer ’s mind about its products because they consider
themselves as a dominant brand and the leader in the CTV market.

MNC’S
SAMSUNG HOME APPLIANCES
Samsung’s electronics related businesses constitute the largest
chunk of the Group’s overall business Here is a brief description of
companies and their respective products associated with electronics
and communication.
COMPANIES RELATED TO ELECTRONICS INDUSTRY
The Samsung companies related to the electronics industry include
Samsung Electronics, Samsung SDI, Samsung Electro-Mechanics,
Samsung Coming, and Samsung SDS. These affiliates produce,
market, and sell a wide variety of electronic parts and components
(including next generation memory chips, computer and
telecommunications equipment, color TV picture tubes, and glass
bulbs). They also develop computer systems and produce general
electronics and precision machines.
All these companies share the same goal of becoming world-class
high-tech companies by early in the 21st century and are
concentrating their investments into promising future fields to
achieve that target. Despite being independent, systematic
cooperation takes place between the companies that enable the
development of state-of-the-art electronic products.

Samsung Electronics, the world's leading maker of memory devices,
also leads the world semiconductor industry in development after
designing a 256-megabit DRAM (dynamic random access memory),
al-gigabit DRAM, and the entire production process technology for 4-
gigabit DRAMS. Samsung Electronics not only produces for the
world information area (telecommunication equipment for system
and network businesses), but also creates a rich life for people
through developing electric appliances and digital and multimedia
products built around the latest technologies.
Samsung SDI puts much energy into developing new products and
furthering new high-tech businesses through securing future cutting
edge technology to react immediately to changes in the display
business environment. Samsung SDI received attention from the
display business by introducing Dynaflat, the world's best level of
completely flat Braun tubes and from developing 42-inch and 50-inch
PDPs successfully to diversify flat display products. Samsung SDI
is also accelerating the development of EFD and FED.
SAMSUNG ELECTRO MECHANICS
Samsung Electro-Mechanics, a leading electronics and electric parts
and components manufacturer, concentrates on developing and
producing promising new products such as multi-layer printed circuit
boards (MLBs), chip devices, parts for mobile communications, and

optical/thin-film components. With 90% of the revenue coming from
exports, the company has positioned itself as a worldwide parts
manufacturing company and is now advancing into the Internet
business. Current plans call to concentrate on Internet related
products based on RF (high frequency) technology.
MANUFACTURING
For CTVs and Microwave ovens
Location : Noida , Uttar Pradesh
Samsung India has a state-of-the-art manufacturing facility for
colour televisions and microwave ovens at Noida. Set up with an
investment of Rs.90 crores, this highly automated facility has a
manufacturing capacity of 500,000 units per annum. Samsung India
is manufacturing CTvs in the 14"-29" size segment at this facility.
With a faster and flexible production system in place, the Company
is striving for greater customer satisfaction by making available the
right product mix to the customer, in time, and at the right price.
The Samsung India CTV facility received ISO 9002, Certification
from BSI, UK and STQC, DoE within eleven months of commencing
production, faster than any other Samsung subsidiary. With the
latest most, advanced manufacturing equipment like Auto Insertion
Machines, Auto PCB Tester, Automatic Module Conveyor, High

temperature testing (45-50OC), Reliability test, precision
measurements of CTVS, the Samsung CTV facility is fully geared for
high speed, high volume and very high quality production.
Microwave Oven Facility : Seeing the high potential for the product
category, Samsung India set up a production line for microwave
ovens at Noida in March '99. Samsung is manufacturing all the
currently available microwave oven models in the market at this
facility, which has a production capacity of 50,000 units per annum.
Samsung which is the world's fastest producer of microwave ovens
having manufactured 50 million microwaves in a short span of 19
years, is producing microwaves in the 20-28 litre capacity range in
India.

SAMSUNG HOME APPLIANCES PRODUCTS
Microwave Oven
1875N-S
Features
 7 Power Levels
 Automatic Defrost Programme
 24-hr Digital Clock
 99 Minute Timer
 Glass turntable
Specifications
 Capacity:
Spacious 23 litres (0.8 cu.ft) oven capacity

 Power Output:
850 Watts Microwave
6 Power levels for cooking versatility - defrost, reheat
and cook
 Auto Programmes:
Auto boil - boils rice and vegetables with a simple
touch of the Auto Boil function
Auto defrost
Auto reheat - drinks, chilled and frozen meals
 TDS:
Triple Distribution System, distributes microwaves
evenly throughout the oven, so that food is cooked
evenly throughout
 Design:
Clear digital display for accurate informative control
Adds style and impact to your kitchen
Touch sensitive control panel for ease of use
 Dimensions (External w x h x d):
489mmx275mmx393mm

 Colours:
White/Silver

M183DNS
Features
 Power Output - 850 Watts Microwave
 Auto Programmes
 TDS

OTHER PRODUCTS
DIGITAL TV
- World’s first to develop ('97.12) and mass-produce

('98. 10)
- Support high screen clarity and have Dolby Surround
Sound
- Adopts high resolution and double progressive scan
methods
- Digital Conversion
- High fidelity 40 watt, 2-way, 4-speaker system
- PIP (Picture In Picture

Flat-screen TV
- Completely flat Braun tube, which allows for a screen
without curves
- Distortion-free screen
- Adopts a 3 dimensional digital comb filter for a more
detailed picture
- The automatic control circuit recreates natural,
original colors
- Powerport speaker system makes you feel as if you
were there

Marketing and
Branding
Strategy

MARKETING AND BRANDING
STRATEGY
MARKETING STRATEGY
Following are the key drivers of profitability in this industry:
Volume Growths: The low penetration levels of these products is a big
opportunity area and the industry is strongly taking this route of increasing the
production and sales volumes in order to make the most of the economies of
scale. With increasing consumption, the raw material prices have been moving
southwards, thereby enabling better profitability
Product Mix management: The challenge is to be able to have a healthy mix of
high-end products contributing to the bottom-line. This can only be achieved by
offering products which are unique and where the customer sees value in his
purchase. The customer is ready to pay more if she feels that she is getting
something, which will improve her life and enhance her lifestyle.
Product Innovations: It is also important to catch the changing trends in
consumer lifestyles and offer the right product at the right time. Basically, the
Companies must innovate on a continuous basis in keeping with the changing
consumer needs and to differentiate in the market.
Operational efficiency: It is important to gain overall operational efficiencies like
inventory management (Overall inventory less than 15 days), debtors

management (Ideally nil bad debts and zero days operation). A good, committed
and loyal network also contributes significantly to the bottom line.
Technological advancements: Innovations and inventions will play a major role
in shaping of this industry’s future. Technological advancement has always been
at the back of most of the peaks in this industry’s growth. Right from the
introduction of colour picture tube to the recent technological advancement of
CRTs becoming pure flat, technology is the prime booster for this industry.
Advancements in future technologies like the LCD panels and DVD recorders
and the like will critically impact the industry. It is expected that by 2008, 33 per
cent of the worldwide demand will be met by LCD TVs and Plasma TVs.The core
to handling various market challenges is to protect the bottom line while being
competitive in the market.
Brand Positioning: Every purchase of the consumer is not guided by the
cheapest of the prices, but by the benefit that the Customer perceives for the
investment planned . Hence, it is critical to be appealing to the image seekers
while being relevant to the value for money seeker. With lifestyles improving and
becoming important to individuals’ personalities, the brand’s positioning and its
relevance to the consumer will become more important than ever before.
Customer Relationship Management: The experience that the consumer goes
through during the entire purchase cycle and the post purchase usage
experience is critical to the organisations’ future business. Managing customer
relations and the experience that is offered to her throughout will be a challenge
for all players.

Channel Management: A strong influencer on the buying decision is the
network, and the organisation that manages the network better, has a substantial
edge over others.
The past couple of years could be termed as the most dynamic years in the
history of this industry. The rise of MNC brands and its adverse effect on the
Indian counterparts. Many Indian brands have become almost extinct. Few
Indian brands who have not only survived but have grown during this period.
Today, Onida & Videocon enjoy a high brand salience and is seen as a trusted
and reliable brand, with a very high degree of product satisfaction among its
users.
Service and Quality - Given that TV is a high-ticket purchase, the consumer
needs a strong reassurance from the brand in terms of reliability. Longstanding
brands that have proven track record of trouble-free product performance score
on this parameter. Like any product, electronic goods suffer wear and tear.
MARKETING & BRANDING STRATEGY OF LG ELECTRONICS
INDIA PVT. LTD.
LG Electronics India Pvt. Ltd., a wholly owned subsidiary of LG Electronics,
South Korea was established in January 1997 in India. It is one of the youngest
consumer durable brands in the country today, encompassing an impressive
portfolio of Colour Televisions, Washing Machines, Air-Conditioners, Microwave
Ovens, Refrigerators (Direct Cool and Frost Free), PCs, Vacuum Cleaners,

optical storage devices and GSM mobile phones. During the ten years of its
existence in India, LG has earned a premium brand positioning due to its
superior quality, high product performance, revolutionary technological delivery
and warm service. In fact, today LG is recognized as a leader in setting industry
norms starting with the fastest ever-nationwide reach, latest global technology
and product innovation.
“The success in India has been phenomenal and We foresee the Indian
subsidiary to contribute to 10 per cent of the total worldwide turnover by
2010. The success is attributed to the employees who have made all efforts
to make the company grow strength in strength. The Pune factory is in line
with the parent company’s strategy of using the Indian subsidiary as an
export hub for several South Asian countries,” once said by Mr. S. S. Kim,
Vice Chairman & CEO of LGE . LG India will become the export hub for LG
worldwide catering to the Middle East and African markets. The company aims to
touch an export turnover of USD 3 billion by 2010, which will contribute to 30 per
cent of LGEIL’s turnover. The contribution of mobile phones and IT will be 65
percent while the rest 35 per cent will be from Consumer Electronics and Home
Appliances
Vision 2010
With a strong R&D and export focus, LG India intends to become a USD 10
billion company by 2010 of which 30 per cent will be from exports. With their firm
resolution to realize their objectives, they will further consolidate their leadership
position in the consumer electronics, home appliances.

LG’s going places in Indian market
It hasn’t been very long since this Korean electronics and home appliance giant
came to India to sell colour TVs and other white goods. No sooner did the
company entered India than it found this to be a large market for its IT products
as well. LG’s experiments may have resulted in some initial snarls, but the
company is now successful in terms of both market penetration and presence.
Year-on-year LG is registering tremendous growth in its PC components
business. How has this been possible? Not that the company didn’t face any
competition when it came here, but LG has fought well to get where it has today.
New products will bring new markets
LG’s new initiative is to provide value-added products around the PC to its
customers. The company launched an optical mouse some time back, which has
since achieved tremendous success.
LG has also launched a ‘My PC’ initiative. Though not as talked about as
Samsung’s high-profile and well-known ‘Build your own PC’ scheme, the
company feels that the launch was quite successful and claims the response is
encouraging. B- and C-class cities were key targets for the scheme. The
peripherals are being offered to the channels that cater to the assembled PC
market. When it comes to the branded PC market, LG has all the strengths/core
competencies to manufacture a PC.

PRESENT SCENARIO AND RECENT TRENDS
NEW DEVELOPMENTS
BPL Global is part of BPL Ltd., which is the flagship company of
the BPL Group, India's largest conglomerate dealing in Consumer
Electronics, Home Appliances, Telecom, Soft energy and Power
Projects. BPL has technical collaborations with the world's best:
Sanyo Japan, Toshiba Corporation, France Telecom, Media One,
Harris Communications, Octel, Nokia etc.
BPL is a household brand in consumer electronics and home
appliances in the SAARC and Middle East markets. BPL is India's
largest exporter of electronic goods having won many awards
from the Government of India in recognition of BPL's exemplary
export performance.
BPL Global assists worldwide vendors in meeting the import
requirements of the Group viz. Raw materials, Electronic
Components, Mechanical and Electromechanical parts.
BPL Global assists the Group in technology scouting from around
the world to tap the growing Indian market. BPL's strategic
sourcing division is continuously looking for new sources that are
competitive in quality, cost, delivery and service.

BPL Ltd is currently looking at acquiring a manufacturing facility in
Europe to gain a stronger foothold in the Western markets.
According to the company's chairman and managing director Ajit G
Nambiar, the company had identified Eastern Europe for the unit to
make it cost-competitive for the Western markets.
BPL Ltd is looking at stepping up domestic CTV sales to 4 million
sets by the year 2005-06 coupled with a thrust on overseas markets.
BPL is in talks with white goods manufacturers to undertake
operation and marketing (O&M) arrangement for its direct cooling
refrigerators.
The company, which does not manufacture direct cooling
refrigerators, currently sources it from Allwyn-Voltas .
The company hopes to increase its turnover by 35 per cent with the
addition of direct cooling refrigerators to its product line. BPL
commands 32 percent market share in the frost-free segment. The
company also plans to expand its distribution network The thrust is
likely to be in the grade Band C cities
BPL, which made a conscious effort to venture in the direct cooling
segment, plans major non-manufacturing investment in category
expansion. Around 5 per cent of turnover has been earmarked by the
company to promote its refrigerator through fresh ad-campaigns,

The refrigerator segment in India is growing at 15-16 per cent
annually with direct cooling overtaking the frost-free category.
With the entry of several foreign and domestic players in the frost-
free segment, BPL's market share has fallen substantially over two-
three years.
The price differential between direct cooling and frost-free
refrigerator scan be bridged by either an upward revision of direct-
cooling refrigerators or a downward revision of the frost free ones or
a combination of both.
BPL Telecom has listed its one of its three entities-BPL Innovision,
BPL Cellular Holdings and BPL Broadband Networks on the
NASDAQ. While BPL Innovision is an internet service provider, BPL
Broadband Networks aims to be a national long-distance services
provider. The company has invested Rs7.5bn for its convergence
business. These include investments in laying 6000 Kms of fiber
optic cable for setting up five international gateways covering 31
cities in the country. BPL is also exploring the possibility of offering
broad band ISP services through digital subscriber line, cable and
satellite.
Consumer electronics major, Videocon International has taken over
a 3mn ton Russian CTV glass manufacturing facility from a German

bank for Rs1.2bn (including landing cost). With this, Videocon’s
capacity would increase from 3mn tons to 6mn tons. The company
plans to increase its capacity to 9mn tons in the next three years,
which will require an investment of Rs3.5bn.
The company has taken a long-term viewpoint, as there is a global
shortage of the product. The shortage is likely to continue following
shift in the demand from small and medium TVs to large and flat
TVs, which require 30% more glass. The technology for the venture
has been provided by US-based Technologies, the largest CTV glass
manufacturer in North America and a wholly owned subsidiary of
Japanese electronics major, NEG.
Videocon has introduced a third brand from the Semi-Tech Global
stable -- the group which owns brands such as Akai and Sansui -- in
an effort to tap the economy segment of the colour televisions
market.

Future
Prospects in
this Industry

FUTURE PROSPECTS IN THIS INDUSTRY
Future Investment
In the future scenario, the consumer items like C T.V., refrigerator,
washing machines etc. have become an area of necessity rather
than a luxury item. And hence, the demands of consumer items are
increasing each passing day. As we know, after 1991 Indian door
were flung open to foreign operator. Many came flooding in and the
competition became sharper. In such condition, Indian player like
BPL, Videocon etc. faced a lot of competitions since 1991. A
decade after globalisation, liberalisation and mobilisation, there has
been ample change of marketing policies of Indian market. In fact,
India has emerge an important market of the world.
The role of MNCs have been increasing .
For instance :
Videocon International Limited reported sales of 37.04 billion Indian
Rupees (US$680 million) for the fiscal year ending March of 2005.
This represents an increase of 9.5% versus 2004, when the
company's sales were 23 billion Indian Rupees. Sales at Videocon
International Limited have increased during each of the previous five
years (and since 2003, sales have increased a total of 47%).

Sales of Air Conditioners saw an increase that was more than
double the company's growth rate: sales were up 113.5% in 2004,
from 620.96 million Indian Rupees to 1.33 billion Indian Rupees. Not
all segments of Videocon International Limited experienced an
increase in sales in 2004: sales of Television Sets and Video
Assemblies fell 1.2% to 17.42 billion Indian Rupees.
Under a new scheme - Gift in India - Videocon is making a direct
pitch for the large population of non-resident Indians (NRIs) in
various countries. The scheme will offer a 20 per cent discount to its
NRI clientele on a range of products including colour televisions,
refrigerators, air-conditioners, audios, kitchen appliances and
washing machines. The scheme's objective is to make it possible for
individuals in various countries to gift a Videocon product to anyone
in India.
The scheme is pegged at Videocon's Indian retail price list and also
includes the service warranty. The added benefit is that customers
can pay in the local currency of the country they reside in. Videocon
would focus on countries such as the US, the UK, Dubai, Oman,
Canada, Kuwait and Uganda, which have a substantial Indian-origin
population. Other conditions include the presence of an Indian bank
in the countries where the scheme would be offered. Videocon has
distributors in the US and the UK and an office in Rome.

Sales of B/W TV sales have also been hit by increasing competition
from the second-hand CTV market. Production of B/W sets is
expected to be lower at around 5.3 million units compared to six
million in 2004 . However, the precise value figures are not
available. New CTV sets come cheap, thanks to the exchange melas
and easy finance offered by leading CTV manufacturers. Moreover,
the price differential between a 20-inch B/W set and a 14-inch CTV
has narrowed down, encouraging a shift to the latter type. The
second-hand CTV market is growing too, with sets available for
throw-away prices. According to the manufacturers of B/W sets, it is
difficult to peg a set below Rs 4,000, especially when customers
demand more bands like S-band and Hyper-band (which allow
reception of more channels). B/W sets are bought mainly by cost-
conscious consumers - for whom Rs 4,000 is not cheap. Philips,
Crown, BPL, Videocon and Salora are the leading players in the B/W
TV industry. These manufacturers also complain of rising input
costs. According to them, with global glass shell manufacturers like
NEG of Japan and Samsung of Korea raising the prices of their
products, component prices have gone up sharply during the year.
During the year, the price of picture tube has gone up from Rs 430
to Rs 500. In fact, leading industry players have accused picture
tube manufacturers of forming a cartel at a time when the industry's
performance is poor.

The washing machine market consists of two broad segments –
semi-automatic and fully automatic. The semi-automatics, that
started selling and growing in the late 1980s still sell the largest,
accounting for around 80% of the total market. This has been due to
a variety of factors, price being one of them. The semi-automatic
varieties are in the range of Rs4,000 to Rs8,000, the fully
automatics are in the range of Rs13,000 to Rs18,000 and the new
generation fuzzy logic machines come for above Rs18,000.
Moreover, fully automatic machines require continuous water supply
(for each wash cycle, the water is changed 2-3 times). Most Indian
cities have been facing a problem of scarcity of water.
Trends have also indicated a shift from 3-4 kg capacity machines to
larger ones. The 5 kg model would remain the largest selling
category. The semi-automatics are more likely to be purchased by
first-time buyers while fully automatics and larger sized machines
would be bought more by replacement buyers.
The washing machine segment has been witnessing a lot of activity
of late with many new entrants making their foray into this segment.
Today, the consumer has a choice of 17 odd brands and over 90
models to choose from. Intense competition has reduced prices
considerably, the consequent squeeze on margins on top of
declining volumes has added to the woes of the players in this
segment.

MNCs, after initially targeting the top end of the market (as only 5 kg
and above capacity machines were allowed to be imported), have
realized that volumes still lie in the semi-automatic segment. Hence,
they are busy reworking their strategies. Samsung, LG have models
lined up to cater to these markets. This shift would present entirely
new challenges for these players. This segment is extremely price
sensitive and here local players definitely have an edge.
Brand % share
Videocon 25
BPL 17
Onida 3
OTHERS 55
Videocon's market share, which was more than 50% a couple of
years ago, is now half to 25%. This is one of the reasons why the
washing machine segment has not grown. The leader has been
unable to lead well. The company has not made any fresh
investment and has not launched nor advertised any new models.
BPL is also not doing very well although presently, there is a lot of
activity going on in the company. The company has merged its
refrigerator and washing machine business into a single company --
BPL Sanyo Utilities. The new company will concentrate on the white
goods and brown appliances market.

3%
17%
55%
25%

SWOT ANALYSIS
STRENGTHS
 Strong brands
 The vigorous growth of the satellite TV and the choices own
available to the consumer is a point of strength for the industry
 India has become an excellent base for consumer electronics
manufacture because the liberal policies of the government have
attracted leading multinationals from Japan, Korea etc., to come
and set up business in India either on 100% equity basis or joint
ventures. Recently under the trade agreement of WTO, the Indian
government has opened its quantitative restriction of various
conditions. And hence, Videocon has to play a major role and
grab the opportunity.
 Now the Indian consumer has a greater choice for the foreign
product and even the home products.
 Developed distribution infrastructure.

WEAKNESS
 Market penetration is still very low, whereas China with
comparable levels of income boasts of 21 million colour TV sets
alone today, we are hardly at the level of 6 million.
 Narrow product range, low sustenance capability
 High import content
 small domestic market hence long productions capacities lying
under utilized
 Low quantities resulting in export prices being non competitive.
 Additional finance not available for WC from India’s Banks.
OPPORTUNITIES
 The increasing presence of multinationals in India for
manufacturing be it Samsung Goldstar, Panasonic, Sony, provides
an opportunity for up grading the quality of manufacture in the
country.
 Growing market, increasing export opportunities.

THREATS
For the Industry
In the new millennium, all the industries including the electronics or
manufacturing are vulnerable due to the global recession of the wold
economy. A few years back, the economic tigers of Asia have faced an
economic breakdown of the economy, and the international organisation such
as WTO, IMF etc. were compelled to channel certain their funds.
For the companies
As per WTO agreement, member countries and particularly India
which has become a member in the year 1995, and hence the
country is committed to reduce tariffs on capital goods, components,
intermediaries and industrial raw materials. India has been
abolishing the quantitative restrictions step by step over the last
three years. In 2002, India removed restrictions on 894 items. This
liberalisation will affect the Indian businesses, and particularly to
Videocon International Limited, BPL. Now the electronic markets
are flooded with the various brands like BPL, LG, Onida, Samsung,
Sony etc.

CONCLUSION
Above the study I conclude that Consumer Durable industry is
one of the most lucrative and fast growing industries. The
Indian economy witnessed a proliferation of global companies in the
National Scene. Liberalization of Indian economy coupled with the
media explosion ushered in a new era of consumerism. Increased
purchasing power and a fluid taste led to the creation of budding
Home Appliances market. The growth rates were as high as 22%
in the white goods segment compared to a merely 2-3% growth
in the European and American market.
Home Appliances industry scenario in India is totally different from
what it was one decade back. Consumer Industry Scenario in India
is totally different from what it is in European Countries. Demand in
developed countries is mainly constituted by replacement
demand white goods market in India was dominated by
indigenous industrial houses like Videocon, BPL, ONIDA,
Kelvinator, and many other, but the entrance of multinationals in
Indian market because of opening up of Indian economy gave these
companies a big blow. MNCs that are gaining good market share
are Samsung, LG, Electrux.

Indian Consumer Durable industry is growing at an overall rate
of 12-13 percent. If we consumer each product market individually,
the Colour Television market has shown a growth rate of 25%.
Refrigerator market is growing at a rate of 8-10%. Reason for
high growth rate CTV market is that now a days TV is not used as a
source of entertainment but also source of knowledge and
education. All these factors act as accelerator. If w take the case
air conditioners, today air conditioner is not only refer to a cooling
machine but also an air fresher. In proportion to growing incidence
of working couples, refrigerators are gaining significance, more and
more as an instrument to store and recycle ready made victuals.
Inspite of many value added Service that are being offered by most
of the brand, the refrigerator market is still biting the dust.
Washing machine market is showing a growth rate of 20-25%.
IFB Electrolux, Samsung, LG are the new entrant and gaining sales
very rapidly especially Electrolux.
The Consumer Durable Industry is one of the bedrocks of global
industrial development.

More specifically, in the Television Manufacturing Industry, which
accounts for a major chunk of all consumer electronics in India,
India account for a meager 4% of the world CTV production and
13% of the B&W TV production - with the market for B&W TV
ordinarily witnessing a negative growth. This pales in comparison
to other Asian countries.
After economic liberalisation our country lowered entry barriers and
brought global companies into the country’s marketplace, it was
realized that the core of the corporate world must change, to focus,
the first time ever in India, on the consumer. And to stop chasing
revenues, profits and market shares, which will flow only from the
new consumer competence. Forget too, forever, the silent consumer
who, before of alternatives, uncomplainingly bought whatever
products were made available. In today’s and tomorrow’s new
unforgiving marketplace it is the choice - empowered consumer who
will decide the fate of the corporations.
There has been a slow down in the US’s economy, this has led down
phase of economy in Indian market along with other developing
market of the world. And hence, the consumer based companies
should check their production. The psychological war is still going
on among the Americans.

And competition, global quality and new economic realities are
conspiring to limit success only companies that are focused
completely on their consumer. For, only these companies and
continuously monitor and meet changing consumer needs:
streamline processes; cut costs and restructure for quicker response
to the consumer ’s demands. All of which will add up to an
unmatched competitive edge, enabling them to conquer tomorrow’s
marketplace today. However , the consumers and spending wisely
not indiscriminately. Changing personal, social, familial and cultural
influences - for instance, the advent of satellite TV, internet and the
information age bringing with them rich, real - time images and data
about global lifestyle- have made the consumer an individualistic,
iconoclastic and irreverent wielder authority over the fate of
corporate’ attempts to fulfil their needs. Which is why in this new
buyer ’s market, the marketer has not choice but no make the
consumer his lodestar.

Recommendations

RECOMMENDATIONS
Followings are the recommendations :
1. Share of market is decided among the leading companies. For
instance, BPL TV Product’s market share is around 6% inspite
of superior quality products. However, in this segment,
ONIDA is the market leader, having market share of 19.6
percent of total sales. And the companies like BPL have to
adopt new policies like aggressive advertising for the
lower end Market and probably provide Exchange Schemes
such that Consumers feel attracted.
2. The number of dealers of companies should be increased.
By this the Companies would be able to have a wide network
and hence a better reach to the Indian Consumers. Unless,
and until they do not increase their dealers, it becomes
difficult to sustain in this competitive Market.
3. Feedback forms can be issued for knowing what perception the
consumers have about brands. What they really want from the
manufacturers.
4. Companies like LG provide excellent after sale services in
all its Consumer Durable segments. It has implemented

Six-Sigma for the time lag to provide efficient, time bound
and quality first Service.
Indian Companies like Onida, Videocon, BPL have to adopt
similar or better policies to match with the competencies of
MNCs
5. All the Companies in all their respective segment have to
increase the Network of their service centre across the
map.

Bibliography

BIBLIOGRAPHY
Books
 Kotler, Philips. Marketing Management , New Millennium Edition, 2003
Magazines
 Business India, page 12, January issue, 2006
 India Today, page 21, February issue, 2006
 Business World, page 5, March issue, 2006
Websites
 www. google.com,
 www.indiainfoline.com ,
 www.yahoo.com ,
 www.webcrawler.com ,

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Research Report

“ Marketing and Branding Strategies of

Consumer Durable Companies”

I would like to take this opportunity to thank the following

people who have directly or indirectly contributed towards

the completion of this dissertation and without their help

this in the present form would have not been possible.

I am thankful to Mrs. Jyoti Bhasin Sr. FacultyFDDI,

Noida for giving me opportunity to work on such a nice

project as my project. And last but not the least my special

thanks to my parents without their support my MBA course

would not have been possible.

IILM Greater Noida 2

IILM Greater Noida 3

Marketing and Branding Strategies

IILM Greater Noida 4

Present Scenario and recent trends 82

Future prospects in Consumer Durable 87

IILM Greater Noida 5

IILM Greater Noida 6

The Consumer Durable industry is huge! Think of a typical day then

you wake up to make coffee that has been brewed by your-controlled

head of your job. At lunchtime, you prepare your lunch in the

with your lawnmower, leaf blower and trimmer. Dinnertime means

prepare for a brand new morning! The number of household

sector that I have chosen to analyze. The appliance that comprise

IILM Greater Noida 7

this sector re ranges, refrigerators, washers, dryers, and

dishwashers the SIC that relate to them are.

Home Appliances industry is one of the most lucrative and fast

growing industries. The Indian economy witnessed a proliferation of

global companies in the National Scene. Liberalization of Indian

economy coupled with the media explosion ushered in a new era of

consumerism. Increased purchasing power and a fluid taste led to

the creation of budding Home Appliances market. The growth rates

were as high as 22% in the white goods segment compared to a

merely 2-3% growth in the European and American market.

Home Appliances industry scenario in India is a totally

different from what it was one decade back. Consumer Industry

Scenario in India is totally different from what it is in European

Countries. Demand in developed countries is mainly constituted by

replacement demand white goods market in India was dominated by

indigenous industrial houses like Videocon, BPL, ONIDA, Kelvinator,

and many other, but the entrance of multinationals in Indian market

because of opening up of Indian economy gave these companies a

IILM Greater Noida 8

EMERGENCE OF CONSUMER DURABLE INDUSTRY

Indian Home Appliances industry is growing at an overall rate of 12-

13 percent. If we consumer each product market individually, the

Colour Television market has shown a growth rate of 25%.

Refrigerator market is growing at a rate of 8-10%. Reason for high

growth rate CTV market is that now a days TV is not used as a

source of entertainment but also source of knowledge and

education. All these factors act as accelerator. If we take the case

air conditioners, today air conditioner is not only refer to a cooling

machine but also an air fresher. In proportion to growing incidence

of working couples, refrigerators are gaining significance, more and

more as an instrument to store and recycle ready made victuals.

of the brand, the refrigerator market is still biting the dust.

Electronics is the fastest growing industry in India. In the liberalised

economic scenario, electronics has entered every walk of our lives

consumer. India is no longer a country, a market where the

consumer has to rely almost entirely on the influx of smuggled