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Campus:BBSR Stream: Level: PCL-1 Year/Semester Module Name: Sales Organization and Sales Strategy Assignment Type: Module Assignment Students Name: RAKESH KUMAR PANDA Assessors Name: Issued on: Reqd. Submission Date: Actual Submission Date: Submitted to : Higher Level Skills Students are expected to develop the following skills in this assignment: Cognitive skills of critical thinking, analysis and synthesis. Effective use of communication and information technology for business applications. Effective self-management in terms of planning, motivation, initiative and enterprise. Certificate by the Student: Plagiarism is a serious College offence. I certify that this is my own work. I have referenced all relevant materials. ________________________ (Students Name/Signatures Case study In a bid to expand the market and boost sales, LG Electronics Ltd. identified institutional sales as a focus area in the calendar year 1999. It plans to triple the target turnover to Rs. 150 crores from institutional sales. LG has honed its institutional sales strategy by identifing and proactively targeting five different segments to push the LG range: brand promotions; the welfare segment (factory workers and office staff); government sector; direct users (hospitals, hotels); and the canteen stores departments (CSD) of the armed forces. A distinct strategy has been tailored for each of the five segments. In brand promotions for example, the perceived value of the products given as gifts is important, whereas for the welfare segment aspirational value, convenience and easy financing are prime factors. Meanwhile, hotels represent a price sensitive segment requiring specially customized products Welfare: In this segment, LG is targeting a consumer base - the aspirational consumer, mostly factory staff - that most companies ignore, but which has considerable clout in terms of generating volumes. This segment is being targeted on the convenience and easy finance platform. LG has just tied up with Birla Global Finance Ltd., part of the Aditya Birla Group, for the purpose. Under the tie-up, LG will unit-wise cover all the Birla companies. This amounts to over two lakh employees. This is a lucrative segment, claims LG, because of the high hit-rate; out of a potential base of 1,000 factory workers, there is an assured sale of at least 10 to 20 %. Hotel Segment: In this segment, LG is targeting the five-star and middle-level hotels (50 - 110 rooms) by offering customized products. For example, LG offers a special 'hotelmode

TV' model with an auto volume leveler, which ensures that other guests are not disturbed. Another attraction for hotels is the cricket game TV model that would also prove to be popular and an interactive option with Internet, video/audio or room service menu facilities. LG claims to have sent out mailers to 1,200 hotels - and bagged at least 100 orders, besides the 'Palace on Wheels' luxury train, for providing TV sets in its 52 cabins. Now, LG is reading a range of interactive televisions for this segment, offering Remote-controlled features like : the hotel menu, local facilities, billing, room service, video on demand, internet, multilingual options Canteens and the Government Sector: "We are perhaps the only company offering our entire range of products in CSD canteens," feels the product manager, of LG. In the government sector, which operates through tenders, significant orders so far included an order for 200 TVs for Himachal Tourism bungalows in the State and over 2,000 TVs for primary schools in rural areas in Maharashtra. The company has a five-member Institutional Sales Division, with each devoted exclusively to one segment. It has 50 institutional sales dealers and a ring of sales representatives when interact with the dealers and conduct demonstrations when needed. Its infrastructure consists of 20 mobile vans with glass windows to display the product range. These vans cover at least 500 km every month in both rural and urban markets.

Questions: Q1. Do you think such a field sales force is adequate to harness the market potential in the Institutional market ? Q2. Would you recommend focusing on one or two segments out of the given five? Justify your answer.

Answer: Q1. I am in favour of such a field sales force. The SF can definite enhance the efficiency of the market. The institutional selling can only be increased with more input of complete team. The field divisions will be more success in reaching the target customers. As each segment has separate focus on their special segment it will be more specific approach and will enhance more attention to the target. The approach will not only enhance the brand prospectiveness but also a long impact to the whole strategies. It seems to be more effective in the institutional market. E.g. new targeted segment is mass selling with Canteens and government departments. These two markets are more enough to cover maximum selling points. The new strategic planning will be more effective and also work under competitions. E.g. focusing on welfare segment it has covered factory or government staffs which are large in size itself. Similarly Hotel, restaurants, and finally the government sector itself is smart division of market for the product. Such segmentation is good enough to enhance the revenue. None of these categories are never seems to be unhealthy to stop for the initial marketing as what have been asked in the question.

Q2. No, I am not convinced with the focusing on one or two segments out of the given five. Each individual segment has its own importance. Therefore, we need to focus equally with all the variety of segments. Brand promotion is equally important as welfare and hotel segmentations. Anyway segmentation of market has wisely being done. The market can be attempted more specifically. Even the mobile strategies can more influence the market and it can cover more areas. Higher the scope of market higher will be the revenue. Therefore, focusing on few segments specifically is not advisable. Distributing or grouping the whole market into different categories and concentrating marketing activities on the same groups is the aim of whole strategies here. The case has explained how they have applied the segmentation in application of promotion of sales and revenue for the same. Thus, it is to be learned from the case to focus on the whole data but not on the few market.