Marketing Magazine Page 1 of 2

Wednesday 03-21-2007

COVER STORY
Electric Dreams
By

By Noelle de Jesus

The business of marketing home consumer electronics may seem, at first glance, pretty
straightforward. After all, we’re talking about selling electrical appliances: air conditioners, televisions,
stereos, home entertainment systems, and a whole range of technology that has become absolutely
essential for a certain standard of modern everyday life in this century.

Still, we are in the midst of one of the toughest business environments yet. It’s not like we’re talking
about rice, soap, milk or diapers -- few people nowadays are so quick to plonk down their hard-
earned money to buy the latest TV set, a brand new hi-fi system, a newer air conditioner, fridge or a
digital camera with all the bells and whistles -- not when the old one works just fine, thank you.

A Level Playing Field

Consumers today are not only more informed, they are also price-sensitive. More are willing to
compromise on brand names to get a lower-priced gadget that has the same bells and whistles.
They’re doing their homework to make sure they get the best deal going, brand or no brand. It may
well be that marketing home consumer electronics is the toughest business there is.

As Paul Temporal, author of Advanced Brand Management: From Vision to Valuation (John Wiley &
Sons 2002) says in his preface, “The availability of new technologies has enabled companies to
easily replicate the products, systems, services and processes of others, generating a huge strategic
problem for businesses of differentiation.” This is particularly true for the consumer electronics
industry. As Senior Sales Manager for Hitachi Chen Teck Beng says, “Whenever you’re trying to
market something that has to do with technology, it is always a challenge, especially because
technology changes.”

Among the other factors that can impede major players are keen competition, a fluid market and the
all-too-volatile factor of price -- all of which are forces in play, even in the best of times. So what are
the main players doing now to capture market share in a tough industry undergoing tough times?

The Power of Brand Awareness

Like they say, old habits die hard, and most of the players are living well on the long-standing
marketing habits. Solid communication via traditional media is not only alive and well, it is thriving in
the consumer electronics industry.

According to Chin Tong Wah, Marketing Manager for Toshiba Singapore AHQ-AG, the unit
responsible for promoting consumer electronics, the Toshiba brand name has been built up through
advertising and along distribution channels. “Our quality has been an important factor for the
consumers’ faith in the brand,” he said, citing a current corporate campaign highlighting its key
product range as Toshiba’s way of strengthening that confidence. And for this, a combination of press
ads and TV commercials are tasked. “Press and TV were chosen for visual impact and mass reach,”
he said. “We want to reach all walks of life, since we are in the business of selling consumer durables
that range from $19 hair dryers to $8000 35” Plasma TVs.”

Radio is also being used to reinforce Toshiba’s branding through English Premier League (EPL)-
related news on SAFRA Radio’s Power98 and Dongli88.3, complementing the brand’s broadcast
sponsorship of the EPL on ESPN.

Sharp advertises in TV and print media to reach consumers, and uses Web marketing as a
complementary tool. Said Jerlynn Low, marcomms executive for Sharp-Roxy Sales Singapore, “We
are constantly exploring creative media ideas to reach out to our audience,” she said. “For example,
our Plasmacluster purifier was the first in Singapore to display product samples in buses.”

The Plasmacluster purifier inactivates virus, mould spores and household odours. The campaign was
Sharp’s first venture with SBS and it entailed placing actual operating product samples on the bus.
“Apart from the products, we also had creative interior panels, posters and hanging mobiles in the
bus,” said Low. “In this way, we brought the air purifier a step closer to consumers.” Sharp also
initiated a DM campaign to reach potential customers along the route.

Sandra Gan, Marketing Manager for OSIM International, said, “OSIM still uses print and television to
a large extent, although we do have a Website through which people can purchase OSIM products
online.” Gan owns that one of the difficulties involves the fact that home electronics goods are not
impulse purchases. “Consumers like to test and try home electronics and learn how to use them, (so)
a fair amount of product knowledge is necessary.” Such information is just not easily transmitted via
your conventional 30-sec TV commercial. Similarly, Jonathan Yeo, Senior Marketing Executive for
Mitsubishi Air conditioners said, “In general, we tend to favour advertisements on television and the
newspapers as the best way to reach our consumers.”

June Ang, Marketing Manager of the Consumer& Imaging Division of Canon Southeast Asia
discusses how the brand implements TV, print, outdoor and online communication initiatives. “I don’t
favour any particular media, but I do feel that a two-way interaction with consumers is important,” she
said. “Online, we reach more people and interact directly with them. A Website can communicate
much more than a TV commercial or a full page ad, and consumers tend to give it more attention.”

Coping with Competition and Price

Most players are loath to mention the most obvious problem. Competition. The fact is consumers are
hungry for information, and while they are not about to buy an electronic appliance because of a TV
commercial, they will remember the brand with the most effective marketing and advertising strategy.

And with everybody poised to do what the other guy does, it’s cutthroat. One way to cope is to keep
the competition in the dark. Perhaps this is why brand giants such as Sony and Philips chose not to
comment. Likewise, a spokesperson for LG Appliances conceded that while they do develop a few of
their own marketing strategies independent of the mother company in Korea, they did not wish to
comment.

There’s also the problem of price and differentiating the product from the competition. Said Toshiba’s
Chin, “One of the major challenges faced by manufacturers is price erosion, as each party tries to
offer the best price.” Toshiba closely monitors price trends in the market so as to be able to offer
more competitive prices. “As much as possible, we like to differentiate ourselves through product
features, for example, the Hyper Progressive Scan feature in our TVs,” added Chin.

http://www.marketing-interactive.com/index.php?session=61f5fcbc87c726913d9e40c... 21/03/2007
Marketing Magazine Page 2 of 2

Overcoming Difficulties

The flurry of marketing initiatives during an economic downturn however doesn’t come without its
costs, but most consumer electronic brands concede that this activity is essential.

As Dennis Mark, General Manager, Personal Systems Group for Hewlett Packard (hp) Singapore,
says, “Consumers are more conservative with their spending during a downturn, and the onus is on
the vendors to make it attractive for consumers to buy.” According to Mark, hp invests in the
marketplace and works closely with partners to help bring people to the shops.

Mark also says that a very definite pitfall is failing to be active in the marketplace. “A downturn is
generally when businesses cut back on marketing because consumers spend less. But at hp, we feel
that this is the best time to break through the clutter and generate awareness for the brand.”

Ang of Canon concedes, “Singapore is a tourist market, so the SARS scare and the cut in travellers
have definitely hit businesses here.” But Canon has not cut ad spend. “But we believe in branding
and marketing,” she said. “We have to be more careful about spending advertising dollars, but we’re
keeping our momentum. In view of the SARS scare, people are spending more time at home
watching TV, reading newspapers and surfing the net, so this is in fact the best way to ‘catch’ them.”

For some players like OSIM International, SARS is seen as an opportunity. As OSIM’s Gan says,
“With people becoming more and more health-conscious, OSIM remains a brand that still meets their
needs. Our hygiene, fitness and nutrition focuses have been very popular.”

Catching Consumers on the Web

Web marketing makes sense, especially where consumer electronics is concerned. As Canon’s Ang
believes, the Web is a two-way street and effectiveness can be measured through click-through
rates. Moreover, a Website provides the target audience with a window-shopping opportunity that no
other medium provides.

Those who haven’t already dunked their feet in the shallows of the Internet are certainly preparing to
get wet. Said OSIM’s Gan, “Web-based marketing has a great deal of potential for us and we do hope
to harness this very effective marketing tool.” Likewise, Chin of Toshiba says, “So far, we have been
quite conservative and do not actively use the Internet to promote our products, but are in the process
of updating and revamping our Website to serve as brochure-wear.” Toshiba has used mass-e-
mailing to inform consumers of product launches, and will continue to review this communication
method.

Promoting the brand via promotions

Martin Dunkerley, Managing Director for Harvey Norman Singapore, notes that promotions and
events can spell the difference between presence and brand recall. “A number of brands enjoy a
significant increase in brand equity when they sponsor important events aligning the prestige of the
event with the prestige of the brand,” he said. “It improves consumer awareness and brand credibility,
and in turn offers more instant recognition on the shop floor.” According to Dunkerley, the role of
instore displays and promotions within well-known retail shops should not be discounted. “This
develops brand importance and recognition and is a growing method of brand promotion,” he said.

The right events and promotions can also draw consumers to the stores. hp recently offered its iPAQ
h5450 Pocket PC to customers at an aggressive price point one weekend in April. “Such activities not
only stimulated business for this model, but helped to generate the much needed retail traffic back for
our partners as well,” he said. Mark also cites promotions with partners such as DBS and its Cashline
Offer. “This program rewards the customer through enhanced product and service offerings, has long
term advantages and contributes to the overall customer experience.”

The Message vs. The Medium

Of course, ultimately, the brand message is critical, no matter what the medium. With the clutter that
bombards the consumer at every turn, now more than ever, content, in particular creative content is
king.

According to Caroline Slocombe, Regional Business Development Director of Lowe Worldwide,

recent research has found that consumers spontaneously associate the consumer electronics
category as being at the forefront of creativity. “Technology brands, more often than brands from
other categories, are cited as creative,” she said. Which means, understanding what constitutes
‘creativity’ in different markets will help marketers better manage this equity element in their
advertising. In Singapore, consumers view creativity as a judicious blend of intellect and pragmatism,
whereas in Indonesia, consumers equate ‘creativity’ with play.

On OSIM’s part, its brand message and content is star-studded. The choice of Chinese actress Gong
Li as spokesperson and image model has served it well. “We wanted an international figure with a
certain ‘star’ quality, someone who is identifiable by the China market and yet is recognized by the
rest of the world,” said Gan.

For Daikin Airconditioning, hopes are placed in a Japanese mascot called Pichon-kun, a little dew
droplet representing the “fresh as morning” nature of Daikin’s product range of aircons and purifiers --
perfect in this time of SARS. Pichon-kun was created in Japan and his matching musical jingle is
playing on radio ads and TVCs, urging the consumer to make his “…a Daikin”.

Advice to the newbies

Writes Paul Temporal, “In Asia, it is only recently that the power of branding has been understood,
and there are many young people who find themselves in senior positions having very little brand
management experience.” This may be less true of the players in Singapore’s consumer electronics
industry who quite willing to toss smaller players a few words of wisdom.

“Be the first to introduce,” said Canon’s Ang. “Be the leader of technology and you’ll be remembered.”
“Determine your core competence, create value in differentiating your concept product and services
and brand them,” said OSIM’s Gan. In the end, in consumer electronics as in any other industry,
strong brands will win out, regardless of the times. But who is to say that today’s strong brand won’t
be tomorrow’s weak one? In this business, the finish line is not fixed and the game goes on and on.

Privacy Policy | Terms & Conditions | Feedback

Copyright © 2004 LightHouse Independent Media Pte Ltd. All Rights Reserved. Powered by DV9 International Pte Ltd

http://www.marketing-interactive.com/index.php?session=61f5fcbc87c726913d9e40c... 21/03/2007