Project Report on Formulation of Marketing Strategies to improve market share of LG microwave Owen

Submitted b R!"#S$ L% &!M'L# R#G (O)*+,-.+//,+ ,-/-*,-// Sikkim Manipal 0niversit 1ndia%

karRo2 3echnologies Ltd% 4enter code no)*-,5+6 Project Report Formulation of marketing strategies to improve market share of LG microwave Owen Submitted in partial fulfillment of the re7uirement for the degree of masters of business administration 8marketing9 of Sikkim Manipal 0niversit % 1ndia ' Rajesh L% kamble Reg no)*+,-.+//,+ ,-/- * ,-//% Sikkim Manipal 0niversit of $ealth: Medical ; 3echnological sciences: <istance
,

education wing s ndicate house: manipal = +5>/-6 <#4L!R!31O( 1 hereb declare that the project report entitled Formulation of marketing strategies to improve market share of LG Microwave Owen submitted in partial fulfillment of the re7uirement for the degree of masters business of administration to Sikkim manipal universit : 1ndia is m original work and not submitted for the award of an other degree: diploma: fellowship or an other similar title pri?e%

Place) * Mumbai <ate) * +,-.+//,+

Rajesh L% &amble Reg no)*

#2aminerAs 4ertification 3he project report of Mr% Rajesh L% &amble entitled Formulation of marketing strategies to improve market share of LG microwave oven is approved and is acceptable in 7ualit and form%

1nternal #2aminer #2aminer (ame) * <esignation) *

#2ternal (ame)* <esignation)*

0(1B#RS13C S30<C 4#(3#R 4#R31F14!31O(% 3his is to certif that the project report entitled Formulation of marketing strategies to improve market share of LG Microwave oven% Submitted in partial fulfillment of the re7uirements for the degree of masters of business administration of Sikkim Manipal 0niversit of health: medical and technological sciences% Mr% Rajesh L% &amble has work under m supervision and guidance and that no part of this report has been submitted for the award of an title or pri?e and that the work
+

has not been publish in an maga?ine Reg no%+,-.+//,+

journal or

4ertified Guide name

!cknowledgement 1 cannot ade7uatel e2press m sense of gratitude to m guide for his constant guidance encouragement and support throughout the project and giving me his valuable time% !lso 1 would like to thank m classmate: m colleagues in office who are working in related industr and have provided me valuable information and help to complete the stud %

>

Rajesh L% kamble

Formulation of Marketing Strategies to 1mprove Market Share of LG Microwave Ovens%

#volutionD%%3rendD%%%and FutureD%%1n 1ndia 1n partial fulfillment for the re7uirement for masters in business administration in marketing
5

,-/-*,-// Reg no%*+,-.+//,+ M'! Sikkim Manipal 0niversit %

TABLE OF CONTENT
Sr%n o -/ -, -@ -6 -+ -> -5 4ontent #E#4031B# S0MM!RC S4OP# OF PRO"#43 1(3RO<0431O( $1S3ORC OF 4OMP!(C LG GRO0P LG 'R!(< 1<#(313C 4O<# OF 4O(<043
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Page%n o%

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#2ecutive summar
1ndian 4onsumer durables market used to be dominated b few domestic pla ers like godrej Boltas allw n and kalvinater% 'ut post liberali?ation much foreign compan have entered into 1ndian market dethroning the 1ndian pla er and dominating 1ndian market major categories in the market 43B: R#FR1GR!3OR: 4O(<31O(#RS !(< G!S$1(G M!4$1(# 1ndia being the second largest growing econom with huge the !1R

consumer class has resulted in consumer durables as the fastest growing industries in 1ndia LG: S!MS0(G the two &orean companies has been maintaining the lead in the industries with LG being leader in almost all the categories% 3he rural market is growing faster than the urban market: although the penetration level is much lower %3he Microwave oven segment is e2pected to the largest contributing segment to the overall growth the industr % 3he rising income levels double*income families and consumer awareness are the main growth drivers of the industries%

/-

4onsumer durables major LG #lectronics 1ndia Pvt Ltd HLG#1LI will invest nearl Rs +-- crore in 1ndia this ear in research and development: brand*building and other marketing initiatives% 3he compan : having a turnover of Rs .:+-- crore and market share of ,> per cent: is investing Rs @>- crore on brand*building and other marketing initiatives and around Rs /6- crore on research and development: besides launching new platforms in information technolog and related areas: LGAs innovative J,// campaignA to provide 7ualit after*sales service: will also be e2panded from the e2isting ,, to 6- cities b ne2t month: 3he campaign: for which 13 infrastructure has been set up: includes the compan As response to customer complaint within two hours% 3he fi2ing time for complaints varies from one hour to a ma2imum of ,6 hours%

Scope of project
3his project gives me great e2posure to the consumer durable market because it includes product knowledge and the filed job in which 1 have visited the store comes under the region of Mumbai% <uring this project 1 also took part in the e2hibition of LG which held for the purpose branding and awareness of LG product% 3his project helps me to know the market practicall % M job was during this project to see the market share and also the displa share of the LG product HMicrowave ovenI in the store% LG alwa s insist the +-K displa share of LG product HMicrowave ovenI because LG believes that L"O <1&$3! $!1 GO '1&3! $!1M% &e findings)*
//

/% '

calculating the displa

share we found that in most of store

LG has +-K displa share almost all categories% ,% ' the actual monthl sale of particular store we came to know the capacit of the store and how much product can the sale% @% 1t helps us to know that weather dealer is capable of being a direct dealer of LG or not and it also helps to find out the new dealer who are capable of being the dealer of LG% 6% Ge also came to know while visiting the shops that there was big problem of after sale service% +% Man dealers were facing the problem of after sale service

because there is no follow up calls from LG% >% <emo calls also not done properl %

1(3RO<0431O(
'efore the liberali?ation of the 1ndian econom : onl a few companies like &elvinator: Godrej: !llw n: and Boltas were the major pla ers in the consumer durables market: accounting for no less than .-K of the market% 3hen: after the liberali?ation: foreign pla ers like LG: Son : Samsung: Ghirlpool: <aewoo: and !iwa came into the picture% 3oda : these pla ers control the major share of the consumer durables market% 4onsumer durables market is e2pected to grow at /-*/+K in ,--5*,--F% 1t is growing ver standards: eas fast because of rise in living access to consumer finance: and wide range of

choice: as man foreign pla ers are entering in the market

/,

Gith the increase in income levels: eas

availabilit

of finance:

increase in consumer awareness: and introduction of new models: the demand for consumer durables has increased significantl % Products like washing machines: air conditioners: microwave ovens: color televisions are no longer considered lu2ur cleaners: and dishwashers 4onsumer durables sector is characteri?ed b the emergence of items% $owever: there are still ver few pla ers in categories like vacuum

M(4s: e2change offers: discounts: and intense competition% 3he market share of M(4s in consumer durables sector is >+K% M(4Ns major target is the growing middle class of 1ndia% M(4s offer superior technolog to the 4onsumers whereas the 1ndian companies compete on the basis of firm grasp of the local market: their well*acknowledged brands: and hold over wide distribution network% $owever: the penetration level of the consumer durables is still low in 1ndia%

4lassification of consumer durables sector /% 4onsumer electronic include vcdOdvd: home theatre: music pla er: color television: cameras: camcorders: portable audio: $i*Fi: etc ,% Ghite goods include dishwashers: air conditioners: heaters: washing machines: refrigerators: vacuum cleaners: kitchen appliances: non*kitchen appliances: microwaves oven: built*in appliances: 3umble dr er: personal care product etc% @% Molded luggage include plastics 6% 4locks and watches
/@

+% Mobile phones

Scope
/% 1n term of purchasing power parit HpppI: 1ndia is the 6th largest econom in the world and overtake "apan in the near future become the @rd largest% ,% 1ndian consumer durable market is e2pected to reach P6-billion b on ,-/@% 1ndia has the oungest population amongst the major countries% 3here are lot of people in the different income categories nearl the two third population is below the age of @+ and nearl +-K is below ,+% 6% 3here are +> million people in middle class: who are earning usP6:6--*0SP,/:F-- a ear% !nd there are > million rich household in 1ndia%
+%

3he upper*middle and high*income household in urban areas are e2pected to grew to @F%, million in ,--5 as against /6%> million in ,---%

Opportunit

/% 1n 1ndia the penetration level of white goods is lower as compared to other developing countries% ,% 0ne2ploited rural market% @% Rapid urbani?ation% 6% 1ncrease in income level: i%e% increase in purchasing power of consumers%
/6

+% #as availabilit of finance% 3hreats $igher import duties on row materials% 4heap imports from Singapore: 4hina and from other !sian countries%

'rands in consumer electronics sector

M(4s LG S!MS0(G $C0(<!1 34L $!1#R P$1L1PS P!(!SO(14 $13!4$1 S!(S01 G$1RLPOOL #L#43ROL0E (!31O(!L R#G1O(!L I I I I I I I I I I &OR#! 4$1(! $OLL!(< S!MS0(G B1<#O4O( GO<R#" BOL3!S SOLO B"*S#R1#S GM4*@-# G#S3O( $< 66.+ O(# 3O04$ S#(SOR "!P!( MGF++6G GR@@6+G

3O<!C 4onsumer durables sector is characteri?ed b

the emergence

of M(4s: e2change offers: discounts: and intense competition% 3he market share of M(4s in consumer durables sector is >+K% M(4Ns major target is the growing middle class of 1ndia% M(4s offer superior technolog to the LG: S!MS0(G the two &orean companies has been maintaining the lead in the industries with LG being leader in almost all the categories%
/+

3he compan : having a turnover of Rs .:+-- crore and market share of ,> per cent: is investing Rs @>- crore on brand*building and other marketing initiatives and around Rs /6- crore on research and development: besides launching new platforms in information technolog and related areas: LG #lectronics is one of the leading companies in the field of electronics with a global presence in man parts% /% LG Global ,% LG 1ndia @% LG Mumbai countries% % 'efore briefing: 1 have divided the introduction part into three main sub

$istor of compan 3he compan conditioners% 3he LG Group was a merger of two &orean companies: Luck and
/>

was originall

established in /.+F as Gold Star:

producing radios: 3Bs: refrigerators: washing machines: and air

Gold Star: from which the abbreviation of LG was derived% 3he

current QLifeNs goodQ slogan is a acron m% 'efore the corporate (ame change to LG: household products were sold under the 'rand name of Lucky: while electronic products were sold under the brand name of Gold Star% 3he Gold Star brand is still perceived as a discount brand% 1n /..+: Gold Star was renamed LG #lectronics: and ac7uired Renith #lectronics of the 0nited States% Global Operation LG #lectronics is pla ing an active role in the world market with its assertive global business polic % !s a result: LG #lectronics controls //- local subsidiaries in the world with around F,:--- e2ecutive and emplo ees% LG Group /% LG% Philips ,% LG 4hemical @% LG 3elecom 6% LG Powercom +% LG 3wins >% LG <acom

Business areas and main products

Mobile communications HaI HbI HcI 4<M! $andsets: GSM $andsets: @G $andsets:
/5

HdI

4ellular Phones

<igital appliance aI !ir 4onditioners: bI Refrigerators: cI Microwave Ovens: dI Gashing Machines:

e) Bacuum 4leaners:

fI $ome (et: gI 4ompressors for !ir 4onditioners and Refrigerators

<igital displa aI Plasma 3Bs:

b) L4< 3Bs:

cI Micro <ispla Panel 3Bs: dI Monitors: eI P<P Modules: fI OL#< Panels: gI 0S' Memor : hI Flat Panel 4omputer Monitors

/F

<igital media aI $ome 3heater S stems:

b) <B< Recorders:

cI Super Multi <B< Rewriters: dI 4<SRG: eI (otebook P4s: fI <esktop P4s: gI P<!s: hI P<! Phones:
i) MP@ Pla ers:

jI (ew &araoke S stems: kI 4ar 1nfotainment

LG 'R!(< 1<#(313C)* 3he brand of LG is delightfull smart% LG strives to enhance the

customerAs life and lifest le with intelligent features: institutive functionalit and e2ceptional performance% 3he brand platform)* 3he LG brand is composed of four basic elements = /% Balue
/.

,% @% 6%

Promise 'enefits Personalit

3he 'rands core Balue that never changes% a% b% c% d% 3rust: 1nnovation: People Passion

3he benefits that are consistentl delivered to the customer includes Reliable products Simple design #ase of use #2traordinar #2perience Personalit describes the human characteristic that are e2pressed to the customer through 3rustworth : 4onsiderate Practical: Friendl

3he 1nternal 4ulture of LG) LG practices four cultures /% Learning 4ulture

,-

,% 'oundar less #nvironment @% ! 4arrier 6% Growth

!ccording to LG: the Learning 4ulture continuousl learning% 'oundar

helps the

emplo ee to learn more and more to develop the habit of continuous

less #nvironment means that there is no difference

between the levels of emplo ees% 3here is transparenc between the work and mutual understanding between all the emplo ees% ! carrier is highl in the compan growing in LG and one who is the emplo ee can comfortable helpful in is ver

develop their carrier largel % ! new comer will feel full and for a new comer the compan the overall growth of personalit % Growth in LG is ver

high for those who are in the compan

and for

those who want to join in LG% 3he compan innovation and the 'L0# Ocean strateg growth%

is growing with fast

is one of the e2amples of

Mission
3he mission of LG is to provide the customers with utmost satisfaction through leadership% 3he fundamental polic leadership that the 4ustomers ma have the utmost satisfaction% Product Leadership
,/

of development is to secure product

Ge are focusing on si2 development areas to become the product leader% /% ,% @% 6% +% >% (ew Machine Reliabilit 4onventional 1nstallation #nvironment Friendl Product Low (oise ; Bibration #nerg Saving

Tualit 1nnovation
3he polic of 7ualit assurance is to provide customers with utmost satisfaction b suppl ing ?ero defects%

LG proceeds in a hierarchal manner% 1t is named as LLG G!CM% From top to bottom) (o%/ LG = is the B1S1O( LJeong-DO Management is LGAs uni7ue application to ethics% LG will succeed through fair management practices and constantl developing our business skill% aI $onest with our customer bI Providing great values to customer through constant innovation ; and development%
,,

cI #7ual opportunities dI #7ual 3reatment Management Principle * 4reating value for customer

4ode of conduct of LG)

/% Responsibilit and obligations to customers ) Respect for 4ustomers 4reating Balue Providing Balue

, Fair competition Pursuit of Free 4ompetition 4ompliance with Laws and Regulations @ U 6 + Fair 3ransaction ) #7ual Opportunit Fair 3ransaction Procedure Support and !id for 'usiness Partners 'asic #thics for #mplo ees 'asic #thics 4ompletion of <ut Self <evelopment Fairness in Performance !voidance of conflict with compan interest 4orporate Responsibilities to emplo ees Respect for human dignit Fair 3reatment Promoting 4reativit
,@

> Responsibilities to societ and countr Rational 'usiness <evelopment Protection of stock holder interest 4ontribution to social development #nvironmental 4onservation

LG 1(<1!)
LG #lectronics 1ndia Pvt% Ltd%: a wholl owned subsidiar of LG #lectronics: South &orea was established in "anuar /..5 after

clearance from the Foreign 1nvestment Promotion 'oard HF1P'I% LG set up a state*of*the art manufacturing facilit at Greater (oida: near <elhi: in /..F: with an investment of Rs +-- 4rores% LG corporate office is located at Plot no%+/: 0d og Bihar: &asna Road: Greater (oida: 1ndia% 3his facilit manufactured 4olor 3elevisions: Gashing Machines: !ir* 4onditioners and Microwave Ovens% NN4ompan is setting up a chain of e2clusive premium showrooms% LG plans to launch >- premium 'rand Shoppes b the end of the first 7uarter of this ear% !t present: LG has a total of F@ LG stores across the countr : of which 6+ are shoppes and @F are e2clusive stores% 'rand shoppes will be placed in the premium segment and the target audience will comprise bu ers interested in premium and high end products% LG 'rand Shoppe goes be ond the concept of a normal e2clusive store b having a more interactive environment and additional
,6

lifest le orientation on displa

so that the customer can actuall

e2perience the LG products in his or her own home settings% LG #lectronics 1ndia Ltd HLG#1LI: consumer durables leader with ,5K market share: is planning a brand new image% 3o attract inspirational and oung consumers across 1ndia: compan will roll out a new marketing strateg % 3he e2ercise will cost the compan Rs @>- crore% LG #lectronics 1ndia is the fastest growing compan in the consumer electronics: home appliances: and computer peripherals industr toda % LG #lectronics is continuall providing: superior technolog products

; value for mone to more than +- lakh households in 1ndia% LG#1L is celebrating the //th anniversar this ear% LG Soft 1ndia the innovation wing of LG #lectronics in 'angalore is LG #lectronicsN largest R;< centre outside &orea% Ge at LGS1 focus on niche technolog areas such as mobile application development: digital video broadcast and biometrics software and support LG #lectronics with our e2pertise% Motivated b a passion for technolog : a strong work culture and lo alt to the organi?ation: we are determined to see LG become one of the top three brands globall % Prominent consumer electronic compan : LG #lectronics 1nc% has said that it e2pects the sale of its products in 1ndia to up b /+ per cent in ,--F% Moon 'um Shin: managing director of LG #lectronics 1ndia has said that the compan has earmarked 6%F billion rupees for investment purpose in 1ndia this ear% 3he said mone will be used to market as well as manufacture new products% LG #lectronics: which is originall a South &orean 4ompan with branch in 1ndia: informed that its sales of GSM mobile phones: color
,+

televisions: air conditioners and other household goods in the 1ndian market was to the tune of .+ billion rupees HP,%6 billionI in ,--5% !s per ShinNs estimate: the sales in ,--F would be around //- billion rupees% 1n order to achieve its target: Shin said LG #lectronics will concentrate on catering to the high*end consumer market which will help boost sales this e2ports to 6- countries% ear% 1ndia churns out si2 H>I per cent of LG #lectronics global revenues of P6, billion% 3he 1ndian branch of LG

1ndia challenges
3he challenges faced b LG when entered in 1ndian market

/% Low brand awareness about LG in 1ndia% ,% One of the last M(4s entered in 1ndia HSamsung: Panasonic entered in /..+ in 1ndiaI% @% $igh import dut 6% 4ompetition from local market pla ers and other M(4s in consumer durable segment% +% Price sensitiveness of the 1ndian consumer LG#1 over comes these challenges to emerge as 1nnovative marketing strateg /% Launch new technologies in consumer electronic and home appliances% ,% LG was the first brand to enter in cricket in big wa a wa : b sponsoring the /... world cup followed it up in ,--@ as well%

,>

@% LG brought in four captains of the 1ndian cricket team to endorse its products% LG invested more than 0SP F million on advertising and marketing in this sport% 6% LG has differentiated its product using technolog and health benefits% 43B has LGolden e e technolog M !ir conditioner has L$ealth air s stemM and microwave ovens have the L$ealth wave s stemM% Local and efficient manufacturing to reduce the cost 3o overcome high import duties LG manufactures 3B refrigerator in 1ndia at manufacturing facilit at (oida and Pune% LG#1 had alread commissioned contract manufacturing at Mohali &olkata and 'hopal for 43Bs% 3his has helped LG#1 to reduce cost% LG#1 implementing the L<igital manufacturing s stemM H<MSI as the cost cutting innovation this s stem is follow*up to the si2 sigma e2ercise LG#1 had initiate earlier%

R;< potential LG has the research and development facilities in 'angalore and Mumbai% 'oth the unit carr out R;< department for the domestic as well as the parent compan it also dose customi?e R;< for the specific countries to which it e2port product% Regional channel and wide distribution network /% LG has adopted the regional distribution channel in 1ndia% !ll the distributers work directl with the compan % 3his has resulted in 7uicker rotation of the stock and better penetration into ': 4: <: class market%
,5

,% LG also follows the stock rotation polic stock on channel partners% Product locali?ation)*

rather then dumping

/% Product locali?ation is the ke strateg used b the LG ,% LG came out with 3Bs% @% 1ntroduced the low*priced L4ineplusM and LsampoomaM for the rural market% 6% LG was the first brand to introduce gaming in 3Bs in continuations of its association with cricket LG introduce cricket game in 43Bs $indi and regional language menus on its

M!"OR &#C S044#SS F!43ORS /% 1nnovative marketing * LG was the first brand to enter cricket in a big wa : b sponsoring the /... Gorld 4up and followed it up in ,--@ as well% ,% Local and efficient manufacturing to reduce cost * 3o overcome high import duties: LG manufactures P4 monitors and
,F

refrigerators in 1ndia at its manufacturing facilit at (oida: <elhi%

@% 4ommissioned contract manufacturing at Mohali: &olkata and 'hopal for 43Bs% 6% Product locali?ation * Product locali?ation is a ke strateg used b LG% 1t came out with $indi and regional language menus on its 3B% +% Regional distribution model * 3his has resulted in 7uicker rotation of stocks and better penetration into the ': 4 and < class markets% >% Leveraging 1ndiaAs 13 advantage * LG #lectronics has awarded a contract to develop 13 solutions to LG Soft 1ndia HLGS1I% 3he project involves development and support for #RP: S4M: 4RM and 13*enabled services for LG%

Strategies adopted b the organi?ation

LG follows /- commandments which are as follows%
,.

/% Foster working environment*+S #nvironment ,% Fast e2ecution is ke to success @% 3ransparent and fast communication*open communication 6% 0pdate market *knowledge =<emographics +% Gin =Gin relationship with the trade partners >% 4ustomer is the king 5% #ven 'illing =Road to ach supplier ! F% 'e in touch with the market H5-K Market: @-K OfficeI% .% Plan and #2ecute annual marketing 4alendar*3ime to market /-% <ispla share of +-K *to get +-K consumer share%

LG market share of LG Microwave ovens in its consumer segments)*

@-

LG position of Microwave oven in various states in 1ndia

3his anal sis is based on the ORG surve

conducted b

LG which

represent the LG position of different consumer durables in various states in 1ndia% 1 select different brand in different categor as per the market share and the demand of product in market% 3his anal sis represents the LG market position during the period of March ,--F% 1t shows that LG has captured ma2imum market share almost in ever categor % LG and Samsung have the ma2imum market in Microwave oven market but LG dominate the almost all the categor consumer durable% Prominent consumer electronic compan : LG #lectronics 1nc% has said that it e2pects the sale of its products in 1ndia to up b /+ per cent in ,--F% Moon 'um Shin: managing director of LG #lectronics 1ndia has said that the compan has earmarked 6%F billion rupees for
@/

in

investment purpose in 1ndia this ear% 3he said mone will be used to market as well as manufacture new products% LG #lectronics: informed that its sales of Microwave oven and other household goods in the 1ndian market was to the tune of .+ billion rupees HP,%6 billionI in ,--5% !s per ShinNs estimate: the sales in ,--F would be around //- billion rupees% 1n order to achieve its target: Shin said LG #lectronics will concentrate on catering to the high*end consumer market which will help boost sales this ear% 1ndia churns out si2 H>I per cent of LG was #lectronics global revenues of P6, billion% 3he 1ndian branch of LG e2ports to 6- countries% Shin remarked that the compan million in ,--5%
%3he

targeting an increase of e2ports to P@-- million in ,--F from P,@-

ke

strategies being implemented include increasing the

number of its regional offices from si2 to eight% LG has split its southern regional office into two: one comprising the states of 3amil (adu and &erala and the other consisting of !ndhra Pradesh and &arnataka% 1n addition: it has split one of its northern regional offices b making 0ttar Pradesh a separate region after spinning it out from <elhi (4R% 3he other four regional offices take care of #ast: Gujarat and Madh a Pradesh: Maharashtra ; Goa and Punjab: $ar ana ; Rajasthan respectivel % 1n the coming ear: LG is also repositioning its marketing spends:

resulting in a significant increase in its mass media e2penditure for better brand visibilit % LG had a marketing budget of Rs @,- crore in ,--5 with a >-)6- split in favor of below*the*line activities% (e2t ear: the compan plans to increase the share of mass media even as
@,

overall marketing spends would be raised b just about /-*/+K%

<istribution and Marketing 3he compan has number of dealers and warehouses% 3he have LG e2clusive shopee% For the marketing of the products a number of activities are followed /% #2hibitions are conducted from time to time% ,% Societ and college activities are conducted% @% $oarding: Posters: banners are used so as to grab the attention of the costumers% 6% <a to da advertisement in leading newspaper% +% <iscount at festival time% >% For dealer relationship the time in the ear 5% LG divide dealer in gold silver etc% categor performance of the dealers% F% 3he have their sales persons at various sub dealer store and at mordent trade store for particularl for the promotion of the LG product% .% LG also uses the radio FM for the promotion activities% /-% !lso provide capon and scratch card for festive season% to know the arrange dealer meeting at several

40S3OM#R
the iron

S#RB14#

3he best and the biggest international brands are here in 1ndia =but if it all) where is the after*sales*serviceV So integral to a
@@

brand: so critical for its success and so taken for granted in developed marketsW 1n 1ndia: after sales service is: for want of a better description: the pits% So whatAs stopping the best companies from pulling out all the stops when it comes to providing the best serviceV <o customers e2pect for too muchV Or is it that in 1ndia the donAt reall care% 'rand #7uit fanned out to M(4 as well as 1ndian keeping after sales consumer durable companies: stockiest and dealers: anal sts and market researchers to get a feel of whatAs reall across categories% 4ustomers support following the purchase of a product or service% 1n some cases: after*sales service can be almost as important as the initial purchase% 3he manufacturer: retailer: or service provider determines what is included in an warrant Hor guaranteeI package% 3his will include the duration of the warrant from the date of purchase: but increasingl traditionall one ear earAs two or more from being used as a cutting edge marketing tool in pushing products

maintenance andOor replacement polic : items includedOe2cluded: labor costs: and speed of response% 1n the case of a service provider: after*sales service might include additional training or helpdesk availabilit % Of e7ual importance is the customerNs perception of the degree of willingness with which a supplier deals with a 7uestion or complaint: speed of response: and action taken% LG also had a big problem of after sale service in 1ndia% <uring m project 1 also came to know that after sale service becomes the big issue in Mumbai region% 4ustomers as well as dealer were facing the problem of after sale service% 'ecause of this problem man dealer in Mumbai region were not read to sale LG product% So it becomes the big issue%
@6

'ut LG has taken some solid steps towards improving customerAs perception and e2perience of after sales service% 'ecause it ver important in competitive market to provide the best service% L G #lectronics has signed a memorandum of understanding with ,@ 1ndustrial 3raining 1nstitutes to strengthen its after sales service in 1ndia% 3he compan aims to recruit /-:--- people b the end of this ear as a part of its branding strateg from discounting% L G #lectronics has identified eight states with high after sales service call rates to ink the deals with the 131% C B Berma: director $R and management s stem: LG #lectronics said: Q3he 4ompan was tr ing to find a solution for effective after sales service since last two ears% 3here is a huge need of trained manpower for the after sales service to align with the compan Ns e2pansion and focus on the GSM mobiles and the personal computer segments%Q /% 1n the initial phase the compan has entered into agreements to focus on service and move awa

with 131s in the states like Maharashtra: Gujarat: <elhi: Punjab: !ssam: and &arnataka and is in the last leg of signing with 0ttar Pradesh% ,% LG Microwave oven: with /,-- service centers: has alread recruited @-- students and plans to beef up the number to /-:--- b the ear*end% @% Q3he compan has offered a scholarship to the selected

students for the last si2 months of their training programme:Q

@+

6% 3he compan

will invest Rs F crore HRs F- millionI in emplo ee ear with an aim to attain an F

development programme this per cent attrition rate% +% 3he compan last moved awa

from the discounting strateg

since

ear and is putting thrust on the 7ualit

and service in its

brand communication to position LG as a premium consumer Microwave oven% >% !t the top: the Service <ivision in &orea reports to the Global 4MO% H!s mentioned in <ermotAs public interview in #3 on Gednesda I% 3his shows commitment that Service must be made into a marketing differentiator: and leveraged thus% 5% LG has the widest service network across the countr X some estimates put it at a significant multiple of service*infrastructure from our nearest competitor% Ghile the sale si?e ma our mone where our mouth is% F% 3he compan has introduced a ,// service * once for ou register ou Hhence also be a nice multiple from nearest: it shows the compan is read to put

our complaint: we will call

ou back in , hours Hhence ,I: set

up an appointment for the ne2t convenient da second /I% 1f the ne2t convenient da LGI having traditionall shied for

the first /I: and show up in the promised /*hour slot Hhence the ou is the ne2t da : from its service thatAs great too% 1tAs a disruptive action in an industr Hincluding awa responsibilities: and thus not leveraging an mileage from it% .% 3he compan b an is promoting ,// through !3L: probabl the first

time after*sales service is being communicated in this fashion product compan % Cou ma have seen the 3B
@>

commercial or heard the radio advert or seen the newspaper ad or in*shop posters: both of which revolve around prompt response% /-% 3he first LG*owned service centre opened in Gurgaon% works through authori?ed service

HService in 1ndia generall

centers: in LGAs case the work e2clusivel for LG%I ! compan * owned service centre tries that much harder: knows things better: and can even contribute as a revenue center%

Objective of the project

Primar objective 3he main objective of filed surve during the project was to find out the market share of the LG Microwave oven and also calculate the displa share% Find out the positional dealer who can sale the LG Microwave oven in large volume% 3he main objective of research was to identif and development these dealer% direct dealer% 3his will ease the dependence on the some big dealer like Maharashtra and Mahaveer electronics% Find out the problem faced b distribution% Secondar objective 3he Objective was to find out that how far the e2hibitions are helpful in branding:
@5

potential dealer

So LG can make them their

the dealer in sales and the

 Ghile purchasing the consumer durables which parameter is most important for the consumerV <o the consumers prefer the financial facilit consumer durableV $ow fre7uentl consumers change the consumer durableV 3o enhances the knowledge of consumer durable market% 3o increases the knowledge consumer durable product of LG% 3o enhances the knowledge about the marketing and branding activit % for bu ing

Research Methodolog )
Research methodolog is considered as the nerve of the project% Githout a proper well*organi?ed research plan: it is impossible to complete the project and reach to an conclusion% 3he project was based on the surve plan% 3he main objective of surve was to collect appropriate data: which work as a base for drawing conclusion and getting result% 3herefore: research methodolog is the wa to s stematicall not onl solve

the research problem% Research methodolog research stud and it e2plains wh

talks of the

methods but also logic behind the methods used in the conte2t of a a particular method has been used in the preference of the other methods Research design)
@F

Research design is important primaril comple2it

because of the increased

in the market as well as marketing approaches available

to the researchers% 1n fact: it is the ke to the evolution of successful marketing strategies and programmers% 1t is an important tool to stud bu erAs behavior: consumption pattern: brand lo alt : and focus market changes% ! research design specifies the methods and procedures for conducting a particular stud % !ccording to &erlinger: LResearch <esign is a plan: conceptual structure: and strateg and to control variance% of investigation conceived as to obtain answers to research 7uestions

3 pes of research are) <escriptive Research 3he t pe of research adopted for stud studies are undertaken in man is descriptive% <escriptive circumstances when the researches ma

is interested to know the characteristic of certain group such as age: se2: education level: occupation or income% ! descriptive stud be necessar in cases when a researcher is interested in knowing the proportion of people in a given population who have in particular manner: making projections of a certain thing: or determining the relationship between two or more variables% 3he objective of such stud is to answer the Lwho: what: when: where and howM of the
@.

subject

under

investigation%

3here

is

general

feeling

that

descriptive studies are factual and ver necessaril true% <escriptive stud

simple% 3his is not

can be comple2: demanding a

high degree of scientific skill on part of the researcher% <escriptive studies are well structured% !n e2plorator stud needs to be fle2ible in its approach: but a descriptive stud in contrast tends to be rigid and its approach cannot be changed ever now and then% 1t is therefore necessar : the researcher give sufficient thought to framing research% Tuestions and deciding the t pes of data to be collected and the procedure to be used in this purpose% <escriptive studies can be divided into two broad categories) 4ross Sectional and Longitudinal Sectional% ! cross sectional stud is concerned with a sample of elements from a given population% 3hus: it ma deal with household: dealers: retail stores: or other entities% <ata on a number of characteristics from sample elements are collected and anal ?ed% 4ross sectional studies are of two t pes) Field stud and Surve % !lthough the distinction between them is not clear* cut : there are some practical differences: which need different techni7ues and skills% Field studies are e2*post*factor scientific in7uiries that aim at finding the relations and interrelations among variables in a real setting% Such studies are done in live situations like communities: schools: factories: and organi?ations% !nother t pe of cross sectional stud is surve result: which has been taken b me% ! major strength of surve research is its wide scope% <etail information can be obtained from a sample of large population %'esidesX it is economical as more information can be collected per unit of cost% 1n addition: it is obvious that a sample
6-

surve

needs less time than a census in7uir % <escriptive research and fact finding en7uiries of different kinds of the

includes surve

major purpose% <escriptive research is description of the state of affairs: as it e2ists at present% 3he main characteristic of this method is that the researcher has no control over the variablesX he can onl report what has happened or what is happening% 3he methods of research utili?ed in descriptive research are surve methods of all kinds including comparative and co relational methods% 3he reason for using such needs to be fle2ible in its approach: but a descriptive stud in contrast tends to be rigid and its approach cannot be changed ever now and then% <ata collection methods) !fter the research problem: we have to identif and select which t pe of data is to research% !t this stageX we have to organi?e a field surve to collect the data% One of the important tools for conducting market research is the availabilit of necessar and useful data%

Primar

data) For primar

data collection: we have to plan the

following four important aspects% Sampling Research 1nstrument Secondar <ata * 3he 4ompan As profile: journals and various literature studies are important sources of secondar data%

<ata anal sis and interpretation

6/

/% Tuestionnaires ,% Pie chart and 'ar chart Tuestionnaires) 3his is the most popular tool for the data collection% ! 7uestionnaire contains 7uestion that the researcher wishes to ask his respondents which is alwa s guided b the objective of the surve % Pie chart) 3his is ver useful diagram to represent data: which are divided into a number of categories% 3his diagram consists of a circle of divided into a number of sectors: which are proportional to the values the represent% 3he total value is represented b the full create% 3he diagram bar chart can make comparison among the various components or between a part and a whole of data% 'ar chart) 3his is another wa of representing data graphicall % !s the name

implies: it consist of a number of whispered bar: which originate from a common base line and are e7ual widths% 3he lengths of the bards are proportional to the value the represent% Preparation of report) 3he report was based on the anal sis and presented with the findings and suggestions% 3he sample of the 7uestionnaires is attached with the report itself%

Sampling Methodolog )
6,

<etails of the sampling methodolog : 1 have made 3he one is made for the 4ustomer%

7uestionnaire%

(o% of 7uestions in 7uestionnaires for customer) (o% of 7uestion related to LG product) (o% of people met during the research) (o% of respondents during the research) Sample unit Professionals: 'usiness man: #mplo ees: $ouse wife: Gorking women: Students

-> -@ ,-+-

!nal sis)
T/% $ave ou purchased an consumer durable during #2hibitionsV
6@

 Ces (o

1nferences /% >+ K of 4ustomer has not purchased an from e2hibitions% ,% Onl @+ K people have purchased% @% 1t shows that consumers are coming in the e2hibition for knowledge of product and also the want to know that weather there is actual price difference in e2hibition and shop or not% 6% 4onsumer also wants to compare to the different brand which are available in the e2hibition% +% So e2hibitions are more useful to increases brand awareness% >% People are less interested to purchase product from the e2hibition% consumer durable

T%,Ghile purchasing consumer durable which parameter influences ouV

66

 Price Product feature 'rand Service <urabilit

1nference /% @-K of customer gives importance to price% So it shows that 1ndian consumers are ver price sensitive% 3he give more importance to price over the brand% ,% ,>K give importance to brand% So price and 'rand matter a lots for the costumers% !nd the price% @% /.K to product feature Service />K and durabilit .K Service is also a big factor for the customer the are less interested in the durabilit % are also want best brand in best

6+

T@% From where ou prefer bu ing consumer durables #2hibitions 4o% shoppe Showroom

1nference) /% ! majorit of customers prefer to bu from showrooms% Ber

less proposition of customers bu s from #2hibitions% ,% 65K customers are prefer to bu from the showrooms because also

the showrooms are more convenient to customers the think that these shops give more discounts% @% People are less interested to bu comparison of the product% from the e2hibition the

onl

visit the e2hibition for price 7uotation of the product and the

6>

T%6%Cou prefer to bu

from the same as

ou have mentioned in T%@

because of following reasons !ttractive Price Service <emonstrations Offers

1nference

/% 4ustomers bu

from showrooms because of the service and

convenience% 3hese are two main factors% ,% 4ustomers are preferred to bu the sell service% @% 4ustomer also thinks that there is more chance to bargain and the can get more discounts in these showrooms% 6% Price also a factor that attract the customer in these from the showroom because of provide good after

think that these convenient store ma

showrooms%
65

T%>% $ow fre7uentl /*@ ears @*+ ears +*/- ears

ou change our consumer durablesV

More than /- ears

1(F#R#(4# /% 4ustomers prefer to change consumer durables within +*/ears% 1n 1ndia people do not change consumer durable fre7uentl % ,% ,@K customers do not change their consumer durable within /ear%

6F

@% 1t represent that 1ndian consumer do not prefer to change their consumer durable fre7uentl %

40S3OM#R S0RB#C F1(<1(GS /% Secondar mind and secondar Sponsors% ,% From the surve it was found out that the majorit of customers donAt bu LG Microwave oven from e2hibitions% 3he just visit the e2hibitions to see the co% latest model% @% 3he want to bu from the showrooms or from co% showrooms% supports pla create an important role in the customers among the customers% 3he

awareness

support includes <emonstration: #2hibition ; #ven

For them service is important %'eside convenience and other factors service is ke factor% 6% !lso majorit of customers do not want an financing scheme

for purchasing the LG Microwave oven% +% 3here was heav rush on weekends so large numbers of 1S<As

were appointed that da % !lso the live demo calls helps in selling% #2change offers also generate sale% >% 4ustomers are also now ver brand%
6.

choos in bu ing the product and

it is important for the compan to make lo al customer of their

5% 1n surve

we found that LG Microwave oven has captured categor % LG Microwave oven

ma2imum market share in ever categor %

dominates 43B: L4<: and Refrigerator: and Gashing machine:

F% LG and Samsung have bottle neck competition in Microwave oven categor % .% 3he product is well aware and it is on top of mind of customer% /-% 4ustomers are also now ver choos in bu ing the product to make lo al customer of and it is important for the compan their brand%
R#4OMM#(<!31O(S !(< S0GG#S31O(S

/% #2hibitions do not help to generate so much sells but the should be conducted regularl % 3his helps in generating awareness regarding the product in customers which ultimatel helps in sales%
,%

!lso it is helps in advertising for the new products% Like in this e2hibition new LG HLG LRM,->-I was advertised% 4ompan should alwa s focus on service%

@% <ispla share should be increased where there is less than +-K as LG also believes that L"O <1&$3! $!1 GO '1&3! $!1M% 6% 4ompan should tr to improve service% (o doubt the compan products have technicall edge over competitors but in long run it ma hamper the compan As profit% +% 4ompan should concentrate more on its major drivers% as it
+-

'randing and promotions should be done effectivel creates a long lasting image in the mind of customers%

>% 4ompan should also cater to the needs of sub dealers as some of the sub dealers have potential of high sales%

L1M13!31O(S #ver stud has certain limitations% 1n m stud : also there were

certain limitations: which 1 could not able to solve% /% 3he research was conducted in a ver small area% ,% M research work period witness the biggest ups and downs in product sale of different brands: which affected the perception of the customer% 3his was biggest drawback of m stud % @% 3ime factor was also important for me% 1 had onl complete m insufficient for me% 6% 3he customer filled the 7uestionnaire mostl +% 1 had onl found the upper*middle class famil in careless to fill up the manner: so it was difficult to make them hold for time% 7uestionnaire: but generall : an average middle class famil was re7uired for the stud % >- da s to research: for which a full*fledged report was

+/

>% 3he sample si?e is also ver small which represent m research on consumer behavior% M stud is not recogni?able in whole 1(<1! as well as outside Ranchi due to the above limitations and less area coverage%

'1'L1OGR!P$C www%lgindia%com www%google%com www%wikipedia%com 'usiness world 'usiness toda LG maga?ine #conomics times (ews paper 3imes of 1ndia

+,