Project On Marketing Strategies

Of

Submitted To: Prepared By:

Mozam Khan A-15

Mohammed Faeem Shaikh A-45

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 History Of Micromax

Micromax is one of the leading Indian Telecom Companies with 23 domestic offices across
the country and international offices in Hong Kong, USA, Dubai and now in Nepal. With a
futuristic vision and an exhaustive R&D at its helm, Micromax has successfully generated
innovative technologies that have revolutionized the telecom consumer space.

Micromax is on a mission to successfully overcome the technological barriers and constantly

engender “life enhancing solutions”.
The company’s vision is to develop path-breaking technologies and efficient processes that incubate
newer markets, enliven customer aspirations and continue to make Micromax a trusted market
leader amongst people. The Micromax ideology stems from its rooted belief in ‘Innovation’ and
delivering “nothing short of the best”.

Micromax has a lot of “firsts” to its credit on their versatile product portfolio. It was the first
to introduce: Handsets with 30 days battery backup, Handsets with Dual SIM / Dual Standby,
Handsets Switching Networks (GSM - CDMA), Aspirational Qwerty Keypad Handsets, Operator
Branded 3G Handsets, OMH CDMA Handsets, etc.

With a 360 degree advertising and marketing strategy sketched out, the company has an
optimistic outlook for the telecom consumer space. Currently present in more than 40,000 stores
across the country, the company plans to have an aggressive market incursion to reach out to its
customers through 70,000 operational stores in the coming year.

One of the major aspects that contribute towards the substantial monthly growth of
Micromax is its 80% sales in the rural areas.

After building a strong presence in the rural market, where the prominence of both
subscribers and operators is rapidly increasing

Micromax’ is now progressively moving towards establishing its foothold in the competitive
urban towns as well.

With young enthusiasts as its anchor, Micromax Informatics Limited created a niche for

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itself in the telecommunication industry. Micromax ventured into the telecommunication industry
with an end-to-end solution of Fixed Wireless Devices and Wireless Data Cards.
In the year 2008, after delivering upon the technology of fixed wireless-powering desired products,
the company forayed into one of the most predominant genres of telecommunication – Mobile
handsets. Since then Micromax has received commendable response for its unique and interesting
handsets.

Innovation, Cost-Effective, Credible and an Insightful R&D, have now become synonymous
to Micromax in the telecom vertical.
Today Micromax has become a brand which people relate and look up to for realizing their
individual device preferences and other out-of-the-box solutions.

Market Share

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 Micromax is currently the third-largest GSM vendor in the Indian market,
A share of 8.1%, perhaps just a few marks behind Samsung
Samsung at the second position has 10.4% control, as per market reports.
Nokia with 52.7% share is the number 1 vendor
Source : Forbes India, 27 Feb. 2010

Industary Overview:

The Mobile Phone Market in India is worth 130 million handsets annually.
While 70% market share is taken by:
Nokia
Samsung
Sony Ericsson
Motorola & L

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 Nutshell Of Micromax Strategy

Corporate Level strategies:

Expansion strategy

Resource allocation: heavy investment in R&D, lately heavy investment in brand building.

Wide portfolio catering to diverse segments.

Business Level strategies:

Unique Fusion of Cost Leadership and Product Differentiation.

Following a Frontal and Flanking attack strategy.

Products are mostly in the embryonic and growth stages.

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 4 P of Marketing

Price variables Promotion variables

Allowances and deals Advertising
Distribution and retailer mark-ups Sales promotion
Discount structure Publicity

Product variables Place variables

Quality Channels of distribution

Models and sizes Outlet location
Packaging Sales territories
Brands Warehousing system
Service

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 Pricing Strategy

Micromax specialized in entry-level and mid-segment handsets priced between Rs1,800 and
Rs2,400 when it started selling the devices in 2008, confining itself to small towns and rural areas
in the first 12-18 months.

Encouraged by its success, the firm expanded to larger cities and now has a distribution
network of 55,000 retailers, which it plans to scale up to 70,000 by the end of March as part of its
strategy to raise sales to 1.5 million handsets a month.

Price list of Micromacx Mobules in india:

 H360 Rs. 5500/-  X225 Rs. 3399/-

 Q1 Rs. 2400/-  X250 Rs. 3250/-
 G4 Gamolution Rs. 4600/-  X260 Rs. 3500/-
 C112 CDMA Rs. 1600/-  X280 Rs. 3999/-
 C2i CDMA Rs. 2600/-  X2i Rs. 2350/-
 GC255 Rs. 4500/-  X310 Rs. 4099/-
 GC700 Rs. 11900/-  X332 Rs. 3499/-
 Q2 Rs. 2900/-  X414 Rs. 5500/-
 Q3 (Ezpad) Rs. 3600/-  X500 Rs. 5700/-
 Q5 Rs. 4390/-  X114 Rs. 1650/-
 Q55 bling Rs. 5500/-  X115 Rs. 1699/-
 W900 Rs. 7900/-  X116 Rs. 2150/-
 X113 Rs. 2399/-  X118 Rs. 2200/-
 X1U Rs. 2598/-  X1i Rs. 2299/-
 X211 Rs. 2750/-  X511 Rs. 6499/-
 X215 Rs. 2900/-  X555 Rs. 7499/-
 X220 Rs. 2300/  X800 Rs. 15000/

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 Product Strategy

30-DAY BATTERY PHONES

April 2008: Rs 2,249; Now: Rs 1,999 The X1i, Micromax’s first phone, had
a battery that could give 17 hours of talk time and go 30 days on a single
charge.

DUAL-SIM PHONES
July 2008: Rs 1,999-12,999 For those who want two numbers but one
handset.

PHONE-CUM-STEREO
Feb 2010: Rs 4,999 With 3D surround sound, fed by Yamaha and Wolfson

BLING
Feb 2010: Rs 5,500 A big hit with women, comes with Swarovski
embellishments.

PHONE-CUM-REMOTE
May 2010: Rs 2,999 A mobile that can switch TV channels and even
change the AC temperature

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 IN THE WORKS
A phone that can be used as a computer mouse

IN THE TOUCH
A touch screen phone.

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 Micromax deliberately made an attempt to tap the Rural interiors of the country, since this
is THE segment, where the larger pie of the cake share is….and at an affordable price.

The limited supply of electricity was a big roadblock to the growth. And there evolved the
Technology. This led to guarantee 30-day stand-by Battery (No other handset to compete?)

To cater to the wants of the customers to carry two handsets (to make most of the existing
on-going tariff wars amongst service operators), Micromax started offering Dual SIM phones.
Infect, existing product line consists of 27 phones, out of which 23 are Dual SIM.

A clear differentiation was a significant factor that aided the significant growth of
Micromax brand in Indian market.

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 In the versatile product portfolio

 Handsets with 30 days battery backup.

 Handsets with Dual SIM / Dual Standby.
 Handsets Switching Networks (GSM - CDMA) using gravity sensors.
 Aspiration QWETRY Keypad Handsets.
 Operator Branded 3G Handsets.
 Changing the phase of entry level.

Many ideas poured in during the umpteen brainstorming sessions that the four conducted
amongst themselves. Finally, they decided to marry mobile handsets and rural and price-sensitive
India.

Thus, the company’s first phone (the X1i in the pic priced only @ ` 2150/-), was
born in an environment that would transform into what would be proudly called the second-largest
mobile market in the world, next only to US, with about 10-12 million subscribers being added
every month.

And now the Company has 23 Domestic Offices coupled with International Offices
in USA, Hongkong, Dubai etc with 40,000 Stores operational & is being aggressive to reach 70,000
Stores.

To increase penetration in the Indian telecom market, Micromax is bundling with telecom
operators such as Aircel. "Soon, we will launch a project where SIM cards of different telecom
providers will be available with different Micromax handsets. Unless a consumer has personal
apathy towards a particular service provider, chances are he will use the SIM provided to him with
the handset. This will benefit both our brand and the service provider we tie up with," explains Jain.

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 Promotion Strategy

The brand was one of the big spenders in the latest edition of IPL .

Micromax has centered much of its brand building exercise around cricket.

Micromax has taken up the title sponsorship for the entire Indian cricketing season from May 2010.

The ads are for individual products highlighting the product features and USPs

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 Audio Visual Strategies
10th Class Students to Graduation College Students

We intend to highlight the existing need of the Cell - phone usage as a “need” & not
“Luxury” since this segment thrives with Parental involvement & lots of concerns & wrinkled
foreheads amongst them due to the high frequency of their Children being traveling to-n-fro from
college to tuition classes or for Competitive Exams. Hence, we strongly feel the reality to be
presented to the Segment. In-addition, its also plays a significant role of communication with the
rising unpredictable scenario’s on the rise..

Audio Visual Strategies (Content)

With the Student Fraternity, we intend to boomerang the segment with customized
strategy of presenting your ID card to the ‘’Outlet listed near your college’ (no hassle of running
near your homes) and avail of the ‘’x % discount’’
And extended to the All levels of Faculty of the college/school).

Women Segment

While there is no gender bias.. But Women at all ages are on the higher %age of
cellphone usage in the way of a Worried Daughter, Girlfriend, Wife, Parent. We aren’t alien to
Cosmopolitan Segment either. Hence there is Q55 Bling the limited IIFA edition & also the
Swaroskvi Elements launched by Twinkle khanna with line ‘it Twinkles’.

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 With this, we intend to bring a wave of change amongst the Gen X with apps like
Twitter, Facebook and all social networking sites with extravagant features for the Who-is-who in
the Industry.

Tie-up with Service Provider’s is essentially to make a ‘one-stop shop’ to effect the
st
1 time users with Phone + Best Service Provider concept and with freebies & discount in the
offering.

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 Placing Strategy

 High margins to Channel Partners (20% to 30% margine).

 More Commission to those Partners who were willing to stock-up its products.
 Cash discount for advance payments.

 Extensive dealer network.

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 STP ANALYSIS

The strategic marketing planning process flows from a mission and vision statement to the
selection of target markets, and the formulation of specific marketing mix and positioning objective
for each product or service the organization will offer. Leading authors like Kotler
present the organization as a value creation and delivery sequence. In its first phase, choosing the
value, the strategist "proceeds to segment the market, select the appropriate market target, and
develop the offer's value positioning. The formula - segmentation, targeting, positioning (STP) - is
the essence of strategic marketing." (Kotler, 1994, p. 93).
•SEGMENTATION
Market segmentation is an adaptive strategy. It consists of the partition of the market with the
purpose of selecting one or more market segments which the organization can target through the
development of specific marketing mixes that adapt to particular market needs.

Micromax segmented on itself geographically and demographically.

•Geographic: Micromax immediate geographic target is Non Urban and rural segment of
India. With handsets with battery backup of thirty days and with the mobiles having high
features and low cost.

•Demographic: Under Demographic segmentation Micromax segmented itself on the basis

Gender by launching handsets like Q55(Bling) which had features like mirror screen and
again Micromax segmented on the basis of Age by focusing on age group of 18-25,who are
the approx 80% users of the Micromax mobiles.

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 Women Segment
While there is no gender bias.. But Women at all ages are on the higher %age of
cellphone usage in the way of a Worried Daughter, Girlfriend, Wife, Parent. We aren’t alien to
Cosmopolitan Segment either. Hence there is Q55 Bling the limited IIFA edition & also the
Swaroskvi Elements launched by Twinkle khanna with line ‘it Twinkles’.

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 TARGETING

A target market or target audience is a group of customers that the business has decided to
aim its marketing efforts and ultimately its merchandise. A well-defined target market is the first
element to a marketing strategy. The target market and the marketing mix variables
of product, place (distribution), promotion and price are the two elements of a marketing mix
strategy that determine the success of a product in the marketplace.

Micromax targeted the non urban market and the age group of 18-25.

There are three segments of handsets that it works with:

For the premium category, which is solely comprised of QWERTY keypad handsets, the
focus will still remain 'easy chatting'. In fact, Micromax will tie up with social networking sites
such as Facebook to ensure better connectivity and continuous communication for its QWERTY
keypad model users.

In the multimedia segment, it will offer innovation and variety in its features such as radio,
MP3 player and camera. Here, it plans to launch co branded phone along with MTV as 'MTV Music
Phones'. The purpose is to add an oomph factor and gel well with the young consumers.

At the entry level, Micromax will play the 'variety' card. Today, at the entry level, not much
variety is available. Handsets of all companies, available at Rs 1,200-1,300, look equally
unimpressive. Micromax plan to change the face of the entry level phones while keeping the price
more or less same.

On basis of ‘Target Audience’ Micromax has divided its target audience into three categories
- the rural sector, the urban youth and the high profile users. Micromax is solely targeting the rural
segment right now - and why not? After all, it promises the maximum number of consumers and all
they demand from a handset is regular features at an affordable price. The youth segment is the
second most important segment, whom the brand will appease with innovative features such as a
memory card with more capacity, better music and camera quality and a trendy face value. For the
third segment or the premium class 'technological innovation' will be the catchword.

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 Distribution Strategy

Micromax managed to make dealers pay in advance by offering them more margins. It
offered higher margins of 15 % margin, which is higher than the industry average of 6-10%.

Micromax managed this hurdle through strategy of more margins for advance payment.

It is not a new strategy to offer such kind of discounts for advance payments (cash
discounts), but to make a retailer accept such an offer is indeed a remarkable feat .

To increase penetration in the Indian telecom market, Micromax Is bundling with telecom
operators such as Aircel.

For better accessibly and prominence in the

market, Micromax is coming up with 150 experience zones (exclusive stores) across the nation, in
addition to ensuring bigger presence at the multi branded stores.

Micromax now using three tier distribution channel as now it has no brand store yet it uses
this channel as distribution :

| Manufacture |-----To----| Wholsaler |-----To----| Retailor |-----To----| Customer |

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Summary

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