group 6 videocon

8/8/2019 Group 6 Videocon

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VIDEOCON-consumer durables division

Akshata Vyas (2009006)

Chetan Kabra(2009016)

Neelay Thaly (2009026)Rima Dhume (2009036)

Sharon Rodrigues(2009046)

Ankit Tandon(2009056)


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Consumer durables

India -5th

largest market (12th

in 2007) (Study by McKinsey Global Institute )Value of industry is above $4.5 billion

Divided into 2 sub categories-

Consumer electronics Consumer appliances

Televisions Refrigerators

VCD players Washing machines

Audio systems Air conditioners

Mobile phones Microwave oven


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Political Factors:

Anti-dumping duty on imported colorpicture tubes.

Easy credit facility availableResolution to reduce emission of carbon

footprints in the atmosphere

CONTEXT-PEST ANALYSIS


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PEST Analysis (Contd)Economic Factors

Growth of retail sector expected toreach 16% by 2011-12 from 4% in

FY07Reduction in excise duty coupled with

rising incomes

Economic reforms by the government

higher purchasing powerEmergence of organized retail market

-leading to lower prices and higher

varieties


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PEST Analysis (Contd)Social Factors :-

Changing perception of luxury tonecessity

Demand of the consumer durables isseasonal and cyclic.

Highly growing consumer durablemarket

Customized products for rural India

Decrease in average household size

Rural market constraints.


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PEST Analysis (Contd)Technological Factors :-

Improved electricity consumption

Higher quality products

Technological advancementsTrue flat televisions, plasma televisions,

fully automatic machines, multimediatelevisions and home theatres with

advanced HTIB models etc


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Implications

Promising future

Government regulations : major

revolution in industrySurge of more environment friendly

products


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Strengths/Competitive Advantage

Backward integration

Diversified goods portfolio across Consumer

Durables Sector

Multi brand strategy

Wide range of sales and service network

Global company


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Weaknesses

Image of low to medium cost company

Diversification into too many sectors

Cannibalisation

Not much international recognition

Too much rebranding/ changing of

positioning


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Current Advertising Strategy

New logo. Unveiled on 2nd July, 2009

The new V composed of two animated greenshowing going green, lava-like shapes calledChouw and Mouw

Company positioning to connect with the hearts and minds of young-at-heart

consumers.

Shah Rukh Khan and Mahendra Singh Dhoni as

Brand Ambassadors


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implications

Follow current trend for positioning

Diversification

Multi-brand strategy leading to

cannibalization


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CollaboratorsSuppliers

Plastic parts and powder and Printedcircuit boards form a major part of theraw materials.

Chinese as well as Indian companiessupply these items

Makes compressors and printed circuitboards (PCBs), along with shells for thepicture tubes


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Distributors

Largest distribution networks in thecountry

Over 4,000 dealers and sub-dealers,and an after-sales service network ofover 100 service centers

40000 distribution centers


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Alliances

1998-99:- Tied up with Toshiba andSansui

March 1999 tied up with Akai Electricof Japan

June 2005 -Bought out French giantThomson's colour picture tube

businessJuly 2005 -acquired Electrolux

Kelvinator Ltd (EKL), the Indian arm ofSwedish appliances major ABElectrolux.


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September 2006 - it acquired South KoreasDaewoo Electronics

It also picked up a 8% stake in IOL

Broadband. It acquired a part in Datacomwhich had

licenses for services across India.

It recently acquired Planet M

Has recently pitched for Motorolas handsetbusiness


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implications

Alliances are advantageous

Backward integrations

Post sales services are weak


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CustomersMarket size and growth

Fastest growing industryGrowing at a CAGR of roughly 25%

Expected to reach US$158 billion by 2015.

Industry output increased by 2.5% in Q1 2009

Color televisions sales increased by 2% in Jan-Mar09

Videocon sales declined by 15.5% in the December2008 quarter, then increased sequentially

Sales higher by 4% from June to September 09

Gross sales from the Companys consumerelectronics and home appliances division grewby 7.3 per cent (y-o-y) during the September2009 quarter


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Statistics2 0 0 2 - 0 3 2 0 0 3 - 0 4 2 0 0 4 - 0 5 2 0 0 5 - 0 6 2 0 0 6 - 0 7 2 0 0 7 - 0 8

T e le v is io n s

S a le s 1 ,6 3 4 .1 2 1 , 8 3 6 . 1 5 2 , 1 8 8 . 9 8 1 , 9 6 5 . 9 5 3 , 9 4 7 . 2 4 4 , 5 6 0 . 8T o ta l m ar k e t s a le s 8 ,0 0 0 .0 0 8 , 5 0 0 . 0 0 9 , 0 0 0 . 0 0 9 , 1 0 0 . 0 0 9 , 8 0 0 . 0 0 1 0 , 5 0 0 .

M a rk e t s h a r e (v o lum e ) 2 0 .4 3 % 2 1 .6 0 % 2 4 .3 2 % 2 1 .6 0 % 4 0 .2 8 % 4 3 .4 4

M a rk e t s ize (v a lu e ) 8 ,0 3 5 .1 0 8 , 6 7 3 . 8 0 9 , 4 3 4 . 8 0 9 , 8 7 2 . 8 0 1 0 , 7 2 0 . 3 0 1 1 , 3 5 1 .

D o m e s tic c o n su p tio n 7 , 9 2 6 . 9 0 8 , 3 6 9 . 3 0 9 , 1 1 3 . 2 0 9 , 5 4 2 . 3 0 1 0 , 3 8 9 . 1 0 1 1 , 0 4 6 .


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Benefits

Competitive price andhigh quality

Improve standard ofliving

Convenience of use

Frequency of purchase Festive seasons

Retail channel

Showrooms

Hypermarkets

Consumer informationsources

Word of mouth

Dealersrecommendations

Print ads

Television Commercials


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Buying process

Careful comparison

High involvement Dealers influence

Social factors

Decision maker ordecision-making unit

Generally Housewifes incase of convenience of

use

Trends Increased disposable

incomes Growing aspirationsRise in consumption

expenditures

Availability of newmodels

Low switching costs Attractive financing

schemesOther population

dynamics


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Market segments

Urban Market

Mainly bulk of middle class

Rapid urbanisation, 45 % Indians living in

urban areas by 2050, up from 30% in

2007-08

Urban and rural markets are growing at

the annual rates of 7%10% and 25%,respectively

Organised retail expected to garner 10%

share by 2010 from a mere 3% share at


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Year 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08

Per capita pvt. Finalconsumptionexpenditure

14,13814,703

15,891 16,97118,665 20,676

22,899

Not much impact of Global Liquidity crisis leading to increased purchases

On an average increased by 8% in 2008-09

PFCE expected to be higher by 4.7 per cent in 2009-10.

Rural market


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Rural market

Over 300 million people moving up from

the category of rural poor to rural lower

middle class between 2005 and 2025

Rural consumption levels are expected

to rise to current urban levels by 2017

Overall number of rural households

estimated to grow from 135 million in

2001-02 to 153 million in 2009-10

As per an NCAER report, compared to

urban areas, the lower middle income

group in rural areas has nearly

doubled.


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implications

High scope in the rural market

Increase in spending power

Shift to flat screen and LCD TVs


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CompetitorsTelevisionVideocon has a good

foot hold in the CCTVsegment.

Leader LG

Challenger Samsung

Follower Onida

Nicher Sony

Source: CRISIL Research, Industry


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WashingMachines

Leader -LG

Challenger -Whirlpool Challenger- Samsung Nicher- IFB Follower -Godrej



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Refrigerator Leader LG

Challenger Whirlpool

Follower Samsung Follower Godrej



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Cell phone handsetLeader NokiaChallenger Sony Ericsson

Satellite TVLeader cable TVIn DTH leader DishTV


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consumer durable -Samsung Strengths of Samsung

Catching the pulse of the consumer,offering good design and understandingemotions

Heavy investment in technology, productdesign and human resource

Focus on innovative products for the high-end market

Samsung marketing academy Weakness of Samsung

Not targeting mass market

Not spreading the brand all over India


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implications

Need to achieve market share in DTHand cell-phones as being new to themarket

LG became the leader due totechnological advancement and newvarities TV sets.


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projections


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recommendations

Videocon can collaborate with somegaming giants like Sega

Continuing with go green and electricityefficient products

For DTH services can tap untapped ruralmarket

Emphasize on LCD and Slim TVs along withCCTV

Relationship marketing through improvedsales support

Focus on OEMs as in international marketit can provide cost effective products


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references www.videoconworld.com

http://www.ibef.org/economy/consumermarket.aspx

http://us.asiancorrespondent.com/Indianomics/2009/08/27/india% www.euromonitor.com/india

http://www.4psbusinessandmarketing.com/24042008/storyd.asp?

http://www.businessworld.in/index.php/Videocon-s-Identity-Crisis.

www.indianbudget.nic.in

Indian Council for Research on International EconomicRelations (ICRIER)

Databases CMIE IAS, CMIE EIS, CRISIL, PROWESS,

CAPITALINE
http://www.ibef.org/economy/consumermarket.aspxhttp://www.ibef.org/economy/consumermarket.aspxhttp://us.asiancorrespondent.com/Indianomics/2009/08/27/india%E2%80%99s-gaming-industry-to-be-860-million-and-animation-industry-to-be-1bn-in-2012http://www.euromonitor.com/indiahttp://www.4psbusinessandmarketing.com/24042008/storyd.asp?sid=1877&pageno=2http://www.businessworld.in/index.php/Videocon-s-Identity-Crisis.htmlhttp://www.indianbudget.nic.in/http://www.indianbudget.nic.in/http://www.businessworld.in/index.php/Videocon-s-Identity-Crisis.htmlhttp://www.4psbusinessandmarketing.com/24042008/storyd.asp?sid=1877&pageno=2http://www.euromonitor.com/indiahttp://us.asiancorrespondent.com/Indianomics/2009/08/27/india%E2%80%99s-gaming-industry-to-be-860-million-and-animation-industry-to-be-1bn-in-2012http://www.ibef.org/economy/consumermarket.aspxhttp://www.ibef.org/economy/consumermarket.aspx


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Thank you

group 6 videocon

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