Presented by: M.

Arsalan Sheikh Ahsan Bham Sobia Khan

(#7989) (#8106) (#6316)

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Fastest growing industry in India Advertising and brand building has a key role Demand is seasonal and cyclical Price and brand differentiation Technology driven Continuous innovation Supply and distribution network High involvement in R&D activities After-sales services

Consumer Durables
Consumer Appliances
White Goods y Refrigerators y Washing machines y Air conditioners y Speakers and audio equipment Brown Goods y Mixers y Grinders y Microwave ovens y Iron y Electric fans y Cooking range y Chimneys

Consumer Electronics
y Mobile phones y Televisions y MP3 players y DVD players y VCD players

‡ Expected to drive the market to a value of $7.7 billion by the end of 2013, an increase of 60.7% since 2008. An anticipated CAGR of 10% for the five-year period 2008-2013 ‡ In 2013, the Indian household appliances market is forecast to have a volume of 52.2 million units, an increase of 50.4% since 2008. The compound annual growth rate of the market volume in the period 2008-2013 is predicted to be 8.5%.

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In term of purchasing power parity (PPP), India ($3.55 Trillion) is the 5th largest economy in the world and overtake Japan in the near future become the 4th largest. The middle class in India is fueling economic growth and disposable incomes are expected to grow at an average of 8.5% per year until 2015. The urban market has now largely become a product replacement market.

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Indian consumer durable market is expected to reach Rs. 40 Billion by on 2010 The Indian household appliances market grew by 32% in 2010. The top 67 cities in India are the key potential markets for appliances. These cities contribute 14% of the GDP. The market share of MNCs in the consumer durables sector is 65%.

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The rural market is growing faster than the urban market. Rural sector offers huge scope for consumer durables industry, as it accounts for 70% of the Indian population. The urban market and the rural market are growing at the annual rates of 7%-10%and 25% respectively. Rural areas have the penetration level of only 2% and 0.5% for refrigerators and washing machines respectively. In case of television the penetration level is 18%.

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MNCs 
Kor o L o Samsung o Hyundai  China o TCL o Haier  Holland o Phillips  Japan o Sony o Panasoni o Sharp o Hitachi o Sansui o Akai o Ai a o Whirlpool o Electrolux

National
Onida id o on BPL Kelvinator All yn Godrej oltas IFB Bush Cro n Salora Weston Beltak Oskar

R gional

1995-1996 Demand Penetration level 3.43 million 149 per 1,000 households

2005-2006 8.72 million 319 per 1,000 households

2009-2010 13.14 million 451 per 1,000 households

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Demographic
Income Occupation

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Psychographic
Life style Personality

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Geographic
Tier 1 Cities Tier 2 Cities

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Behavioral
Value Benefit sought

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Personal Income Availability of financing Product affordability Increasing share of organized retail Entry of heavyweight retail players Increasing appreciation of the Rupee Technological and design advancements Innovative advertising and brand promotion 

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Situation LG Electronics India Pvt. Ltd., a wholly owned subsidiary of LG Electronics, South Korea was established in January 1997 after clearance from the Foreign Investment Promotion Board. Growth Strategy Focused on innovative, feature-rich products ±´Value-plus´ platform Offering affordable products at a lower margin ±cutting on volume to bring in revenues Key Success Factors

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Innovative marketing strategies LG has differentiated its products using technology and health benefits. Local and efficient manufacturing to reduce cost Implementing a ³digital manufacturing system´ (DMS) as a cost-cutting innovation. Product localization LG came out with Hindi and regional language menus on its appliances Regional channel strategy and wide distribution network LG has over 46 branch offices and 110 area offices across the country. 

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Objectives The ai of L is to provide the custo ers with ut ost satisfaction through leadership. The funda ental policy of develop ent is to secure product leadership that the Custo ers ay have the ut ost satisfaction. Core Competency
Product leadership, Market leadership, People leadership

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Strength
Market leader in home appliance segment Manufacturing unit in taxincentive areas Wide range of product categories to tap the consumer upper-middle class and upper-upper class LG, having the widest distribution network in the industry Good after-sales services

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Weakness
Consumer compare LG products with its competitor Samsung and Sony, not with other foreign brand Similar product categories as compare to its close competitors Samsung

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Opportunity
Shifting to rural market Control over the white goods market, as we know the highest market in home appliance market Home appliances market is growing very fast, so there is an opportunity for LG to launch new technological products.

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Threat
The closest competitors Samsung is also from South Korea, and consumer compare LG products with Samsung products Price-against-benefits war with its closes competitors, Samsung & Sony Competitors from Indian brand and new entrants.

promotion and advertising Branded its products as superior technology and environment friendly Samsung India Electronics Ltd. is a ones. subsidiary of Samsung Electronics `Launching the best in design and Corporation (SEC) headquartered in technology Seoul, Korea. Samsung India was Samsung has won over 150 awards formed in 1995. in India for its technology and design based products. Growth Strategy `Customized products for its consumers understands the local cultural `Building an affluent customer base ± sensibilities to customize its products according to the market. higher priced products `Manufacturing plant and localization 
Situation `Creating a premium brand image ±design

`Innovative

and technology innovations 
Key

Success factors

`Objectives

Samsung aims to become India¶s leading volume retailer in the consumer electronics segment Achieving its aim by focusing on its Core Strategy Work on strengthening its unique Brand Image Gaining Customer Satisfaction
`Core

competency

Technology leadership

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Strength
Core value: Approach market through technology and design leadership Launching hi-tech and contemporary products with zeal and speed Created a Unique Brand Image for itself as a high end value driven brand The Samsung Marketing Academy

Approach market through technology and design leadership: a slow process. Not targeting the mass market Not spreading the brand all over India

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Weakness

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Opportunities
The Indian Mass Market. The high end value driven proposition helps increase the Market Share. Samsung is well known for it product differentiation

Indian Mass Market may be captured by a rival company, LG, Onida, Videocon;etc. Increased emergence of modern retail chains- a problem as Samsung is investing in building a retail network across the country

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Threats

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Localized positioning Focus on local R&D Range of products in a wide range Dealer network is very strong Many products specially for India

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Positioning on a global basis Centralized R&D Lesser Range of products Dealer Network not as strong Less Indian Customer Centric products

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