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I hereby declare that the work, which is being presented in this project, entitled “Advent of LCD TVs and their future prospects in India” is an authentic record of my own work carried out by me under the supervision and guidance of Mr. S.Thiyagarajan, Project Guide, BHAI PARMANAND INSTITUTE OF BUSINESS STUDIES, Shakarpur, Delhi. This project was undertaken as a part of the Summer Training Project as per the curriculum of “Guru Gobind Singh Indraprastha University, Delhi” for the partial fulfillment of MBA from “Bhai Parmanand Institute of Business Studies, Shakarpur”. I have not submitted the matter embodied here in this project for the award of any other degree/diploma.
ASHUTOSH FOTEDAR ROLL NO. 0031143908 M.B.A., THIRD SEMESTER BHAI PARMANAND INSTITUTE OF BUSINESS STUDIES, SHAKARPUR, DELHI
This is to certify that Mr. Ashutosh Fotedar Roll No. 0031143908, Student of MBAIIIrd Semester, has satisfactorily completed his Project Research Title- “Advent of LCD TVs and their future prospects in India” as a part of Summer Training Project under my guidance for the partial fulfillment of M.B.A degree under Guru Gobind Singh Indraprastha University, Delhi for the year 2009-10.
Mr. S.THIYAGARAJAN [MBA- IN- CHARGE] BPIBS, SHAKARPUR
The project entitled “Advent of LCD TVs and their future prospects in India” was a challenging assignment for me and required an improved environment, extensive endeavor and all necessary support. I take this opportunity to express my gratitude to Mr. Vijay Sharma and Mr. S. Thiyagarajan my Project Guide on behalf of the company and college respectively for their able guidance, cooperation and out of box thinking without which this project would not have been exciting at all. The successful progression of my project also gives me the opportunity to acknowledge and appreciate the staff of the organization as well as of the college that provided me much needed stimulating suggestions and encouragement in order to steer this project towards completion.
Each of the questions was designed to satisfy at least one of the secondary objectives of the research. Television continues to be the mainstay of the consumer electronics industry in India with the transition slowly occurring to newer technologies such as LCD and PDP. microwave and washing machines have low penetration in the country. the consumer electronics goods. The response format was of a mixed variety which also helped in better determination of outcomes. has made the country’s consumer electronics industry highly dynamic. But still. like refrigerators. 4 . To find out the reasons influencing the minds of the common man a marketing research was carried out by me.EXECUTIVE SUMMARY India has an increasingly affluent middle class population that. The survey was conducted by me by visiting 50 dealers of consumer electronics in North Delhi region. The exploratory findings helped me in determining the key factors which needed to be further explored for making the marketing strategy for my company. This is attracting many foreign majors to the country. the present report is prepared to formulate a marketing strategy for increasing the market share of the company in case of the sale of LCD TVs. growing disposable income and availability of easy finance schemes. Keeping the above fact in mind. such as retail boom. representing vast room for future growth. The industry has been witnessing significant growth in recent years due to several factors. on the back of rapid economic growth. The exploratory research was carried out with 50 respondents with a set of 20 open and close ended questions.
4 1.1 2.CONTENTS Chapter No 1 S.No 1.1 1.1 7.1 3.4 4 5 6 7 7.6 2 2.3 1.3 2.5 1.4 3 3.2 3.2 1.2 8 9 Topic Consumer Electronics Industry Worldwide Consumer Electronics Industry Indian Consumer Electronics Industry Trends in Indian Consumer Electronics Industry Competition Overview Policy and Initiatives Challenges and Opportunities Company Profile Introduction Vision Key People Future Goals Essential Theory Liquid Crystal Display Television Marketing Mix Branding Process Consumer Decision Process Research Report Data Analysis and Interpretation Observations and Findings Conclusion and Strategy Conclusion Proposed Marketing Strategy Bibliography Annexure Page No 06 07 09 13 15 17 21 23 24 25 25 26 28 29 39 47 75 79 82 98 100 101 101 105 107 5 .3 3.2 2.
CHAPTER . Consumer electronics appliances such as digital televisions. These changes began nearly two decades ago and have resulted in an avalanche of state of the art electronic devices in the 6 .1 Worldwide Consumer Electronics Industry The consumer electronics industry is a global business. witnessing a phenomenal growth.1 CONSUMER ELECTRONICS INDUSTRY 1. portable media players and educational toys are in a state of constant flux. of technologies. In recent years. video and information technology is a major reason. the consumer electronics industry is in the midst of a new wave of change. The convergence of digital-based audio. It is ushering in a dawn of convergence. products and markets.
any growth is sure to be welcome.1 percent this year over last year to 1.5 percent and 9. anytime will continue to drive innovation and CE sales. incorporating both digital visual and digital MP3 capabilities. Global consumer electronic sales are expected to top $724 billion this year.2 billion units. It has also witnessed the emergence of mobile telecommunications technology. “Liquid crystal displays will grow slower in 2009 but will still achieve double digit unit and 7 .7 percent of total revenue last year but sales are expected to slow in 2009.1 percent growth rates of the previous two years. computer monitor and LCD TV. in-home or in-car consumer electronic items with multiple functions has increased tremendously. down from the 10. the CEA forecast. still camera. making its way into the family living room. HDTV’s with VGA connections and SD/MMC card slots. Digitalization transformed the consumer electronics sector. Miniaturization also accelerates the growth of the consumer electronics industry.market. It paved the way for digital devices such as camcorders." Television sales are expected to grow by 2. The demand for a multitude of portable. play and communicate anywhere. The CEA said that although mobile phone growth was expected to slow "the macro trend of work. this year’s growth will only be 4. personal media players.7% to $694 billion in 2008. DVD player/recorder. growing by just 2. from mobile phones to televisions to computers.4 percent in 2007. according to the Consumer Electronics Association. miniaturization and mobility are the key elements for modern consumer electronic products.3%. consumer confidence at lows and consumer electronics companies suffering.6 percent in 2009 to 232 million units. Microsoft-based Media Centre PCs have pushed the two industries even closer together than before. delivering new and exciting entertainment products that have changed the way we live. Mobile phones accounted for 26. Digitalization. The slowdown in 2009 is expected to affect products virtually across the board. Mobile phone sales grew by 13 percent in 2008 and by 15. While sales grew 13. The computer industry has also benefited. Still with the economy in a downturn.
" the CEA said. the changes in the consumer electronics industry are not being driven by product evolution. "Laptop PCs are expected to continue to generate double digit increases in units and revenue in 2009. the ratio of desktop PC unit sales to laptop PC unit sales was 58 percent to 42 percent." The ratio of laptop PC sales to desktop PC sales is expected to continue to widen this year with 63 percent of the computers sold in 2009 expected to be laptops. Companies that are capable of change and those that develop branding will be most successful. with North America accounting for the largest percentage of Blu-ray sales followed by Western Europe and Japan. Fundamentally. The CEA said emerging powers China. "Desktops will experience declines in both units and revenue. DVD players and other household electronics face the same challenges as other consumer goods 8 . It said that in 2005. "Plasma displays are forecast to achieve positive unit growth and negative revenue growth. but by fluctuations in the industry's business models." the CEA said. the CEA said.7 percent.It said the game console market is expected to grow by 5. with growth forecast at 8. The CEA said MP3/digital media players were expected to generate "strong sales" in 2009 along with portable navigation GPS units.8 percent growth of last year. The trade association said the trend towards "no strings attached" wireless devices would accelerate along with increased touch screen and voice activation technology. energy efficiency and recycling potential." The CEA's 2009 outlook for computer sales is somewhat better. Consumer electronics companies producing computers." the CEA said. televisions. the trade association said to expect products that were environmentally friendly in terms of the materials used.1 percent in revenue in 2009. the CEA said. As for trends to watch this year.2 percent over 2008 but still a significant drop from the 17.4 percent in units and 1. Russia. "Unit sales of portable navigation grew 55 percent in 2008 and are expected to grow another 22 percent in 2009. Blu-ray DVD sales were expected to nearly double in both unit sales and revenue in 2009. Brazil and India now account for nearly one-fourth of worldwide consumer electronics revenue (24 percent) while North America and Western Europe combined account for 37.revenue growth worldwide. packaging.
1. The rapidly falling prices and improved functionality provided by convergence are influential forces behind the growing consumer demand for electronic items. Samsung can claim to be the world's fastest growing electronic company. differentiation and flexibility are critical to a company’s survival in the consumer electronics market. The Asia Pacific region is the market leader wielding the biggest chunk of the market. 3. pricing and promotions management even more challenging. Increased local manufacturing. Expanding distribution networks. The European market share is expected to take a drubbing due to the growing demand for consumer durables in the Asia Pacific consumer electronic market.2 Indian Consumer Electronics Industry India has an increasingly affluent middle class population that. Growing consumer confidence due to rising disposable incomes. has made the country’s consumer electronics industry highly dynamic. 4. closely followed by Europe. Japanese companies have captured the consumer electronics market. Easy financing schemes that are making purchases possible. 9 . 2. on the back of rapid economic growth. Korean companies such as Samsung and LG are all trying to join the Japanese bandwagon. Panasonic and Matsushita are all owned by these Japanese manufacturers.companies. The growth is aided by a multitude of factors. a factor that makes demand. Innovation. World famous brands such as Sony. including: 1. The lifecycle of consumer electronics products is shrinking along with severe price deflation.
10 . This has not favoured durable companies till now. double-income families. demand for consumer durables has increased with rising income levels.9 12. especially the rural electrification program.8 11.2 13.Growth of Consumer Electronics Production in India 18 16 14 12 10 8 6 4 2 0 15. increasing consumer awareness and introduction of new models. Products like air conditioners are no longer perceived as luxury products.8 18 Rs billion Rs billion 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 Year In consonance with the global trend. changing lifestyles. The figure presents iSuppli's estimates and projections for the size of the Indian audio/video consumer electronics industry for the period of 2004 to 2011.7 16. One of the critical factors those influences durable demand is the government spending on infrastructure. Given the government's inclination to cut back spending. availability of credit. Any incremental spending in infrastructure and electrification programs could spur growth of the industry. rural electrification programs have always lagged behind schedule. over the years.
5 billion) in 2007. catering to a population of more than 100 crore people. 390 crore ($4.18. With a market size of Rs.0 per cent from Rs. Several companies are conducting market research in order to understand the psyche of an Indian consumer. 931. Television continues to be the mainstay of the consumer electronics industry in India with the transition slowly occurring to newer technologies such as LCD and PDP.The consumer electronics market is one of the largest segments in the electronics industry in India.13 crore ($3.13 crore ($6. rising at a Compound Annual Growth Rate (CAGR) of 10. For example. companies are trying to identify customer requirements. LG in 2006 launched a range of TVs from 21 inches to 29 inches in size that were designed based on the company's research on consumer preferences for television 11 . Companies are focusing on customizing products to suit Indian tastes.59 billion) by 2011. thereby creating a niche for themselves. Most players in the consumer-electronics industry have introduced products in the FPD segment. ISuppli Corp.26. especially the Korean chaebols. predicts the Indian audio/video consumer electronics industry will grow to Rs. FPD remains a focus area.15. The inputs from this research are determining product attributes and pricing and accordingly are achieving better acceptance among consumers. 897. and for few companies.89 billion) in 2006. By conducting consumer research. thereby incorporating specific design elements into their products. the consumer electronics industry in India is poised for strong growth in the years to come.
As the awareness among rural consumers rises. such as Flextronics' deal with in Silica for the development of SOC devices. they are expected to show a preference for branded products. companies are expanding their distribution networks in these areas. such instances are few and far between. However. The move has positively impacted sales for companies opting for rural expansion.sets. although such relationships represent an extension of their global relationships. rationalizing duties and creating export-promotion zones. In order to tap semi-urban and rural demand. India also is assuming a significant place in the global plans of several major electronics manufacturers. As the local market gains size. This is reflected by the fact that established players are reporting years to come. some local partnerships also are appearing. the trend is gradually changing. rural consumers have not been as brandconscious as their urban counterparts. This is in alignment with India figuring into the plans of several companies that want to cater to the domestic and export markets. these associations will become more common. Domestic consumption is reaching significant size to trigger manufacturing in the electronics sector. fabless companies are suitable to cater to such development because they can assist in moving the industry up the value chain by creating design-service opportunities for the Indian market. rural consumers have been inclined to buy these products. thereby positioning it also as an export base. Currently. The government has been focusing increasingly on developing the manufacturing sector by developing infrastructure. Although electronics production has remained a miniscule portion of overall Indian manufacturing for a long time. ISuppli expects domestic manufacturing to be a key characteristic of this growth in the 12 . although they often have poor quality. EMS and ODM companies in India have been associated with several design companies. Furthermore. higher sales of products in rural areas. However. Due to the lower prices of unbranded products.
PCs (Desktop & Notebook) 13 .Set-top Box . mobile handsets.Mobile Handsets . underlining the future potential areas and key issues crucial for the industry development.Microwave Oven . It briefly discusses about the current and emerging trends in the industry. of following consumer electronics products: . It provides an insight into the emerging and potential future trend in all the categories and highlights the key strategies that need to be worked upon to get success in the highly competitive industry.MP3 Players .Washing Machines (Semi-automatic & Fully Automatic) . and PC market.Digital Camera & Camcorder . This analytical research thoroughly evaluates the Indian consumer electronics industry.Air Conditioner .1. audio/video appliances. The report thoroughly analyzes the historic performance and future prospects.Television .3 Trends in Indian Consumer Electronics Industry RNCOS research report finds that since the penetration of several products like TVs and refrigerators are reaching saturation in the urban areas. the markets for these products are shifting to the semi-urban and rural areas. offering 4year industry forecast. 'Booming Consumer Electronics Market in India” offers extensive research on various consumer electronics products that are broadly classified as home appliances.Refrigerator (Frost-free & Direct Cool) .
and the share of FPTV is projected to increase at robust rate in near future. demand for MP3 players and digital video appliances are anticipated to surge at double-digit rate in near future.Volume sales of washing machine will be driven by growth in fully automatic category during 2008-09 to 2011-12.The AC market in India is projected to grow at 30% to 35% for the coming few years. are anticipated to drive the Indian refrigerators market over the forecast period. 14 . .Frost-free refrigerator sales.The low penetration level of consumer electronics goods coupled with increasing preference for comfort and luxurious goods are widely attracting the foreign as well as domestic players to the industry. Currently. changing lifestyle and rapid urbanization. the Indian consumer electronics industry is forecasted to grow at a rapid rate of 10% to 12% in the coming few years.Driven by young population.The market for televisions in India is changing rapidly from the conventional CRT technology to Flat Panel Display Televisions (FPTV). .Key Research Findings: . . .Propelled by growing middle class population. certainly growing at a much faster pace than the direct-cool category. . . the split between CRT and FPTV is around 97% and 3% respectively.
Colour Monitors. Estate. According to IMRB surveys Whirlpool enjoys the status of the single largest refrigerator and second largest washing machine brand in India. Tokyo. 375 crores. Refrigerators and Washing Machines is located at Noida. 1958 (As a private Company) and in 1959. The Samsung manufacturing complex housing manufacturing facilities for Colour Televisions. today enjoys a sales turnover of over US$ 1 billion in just a decade of operations in the country. operating 77 subsidiaries around the world with over 72.4 Competition Overview Samsung India Samsung India commenced its operations in India in December 1995. Laden and Ignis.1. Michigan. Pondicherry and Pune. CIS and SAARC countries from its Noida manufacturing complex. Bauknecht. The company owns three state-of-the-art manufacturing facilities at Faridabad. Today.1. the annual turnover of the company for its Indian enterprise was Rs.000 employees worldwide it is one of the major giants in the consumer durable 15 . LGE started manufacturing radios. Shanghai and Romen. Samsung India has its headquartered in New Delhi and has a network of 19 Branch Offices located all over the country. LG India LG Electronics was established on October 1. Whirlpool of India Whirlpool was established in 1911 as first commercial manufacturer of motorized washers to the current market position of being world's number one manufacturer and marketer of major home appliances. USA with a global presence in over 170 countries and manufacturing operation in 13 countries with 11 major brand names such as Whirlpool. San Francisco. with around 18% of its employees working in Research & Development. Roper. Los Angeles. near Delhi. Whirlpool is the most recognized brand in home appliances in India and holds a market share of over 25%. Colour Monitors and Refrigerators are being exported to Middle East. In the year ending in March '06. The parent company is headquartered at Benton Harbor. Samsung India currently employs over 1600 employees. Samsung design centers are located in London. Kitchen Aid. Samsung ‘Made in India’ products like Colour Televisions.
1913. The name was changed to Kalyani Sharp India in 1986. Japan. In India.000 Retail Outlets. Japan . The company has as many as 27 R & D centers and 5 design centers. The Company is one of the largest privately-held diversified industrial corporations in India.270 million).200 Wholesale Dealers. 1932. The Company has a network of 38 Company-owned Retail Stores. Nairobi (Kenya). Colombo (Sri Lanka). amounted to about Rs.domain worldwide. Godrej India Godrej India was established in 1897. The combined Sales during the Fiscal Year ended March 31. 58. under the Indian Companies Act. and more than 18. CDMA handsets. The Company has Representative Offices in Sharjah (UAE). 215 Sony World and Sony Exclusive outlets and 21 direct branch locations. It's global leading products include residential air conditioners. Toshiba India Toshiba India Private Limited (TIPL) is the wholly owned subsidiary of Japanese Electronic giant Toshiba Corporation and was incorporated in India on September 2001. The company was entered into a joint venture with Sharp Corporation. 2006. DVD players. more than 2. Sharp India Ltd Sharp India ltd was incorporated in 1985 as Kalyani Telecommunications and Electronics Pvt Ltd. Riyadh (Saudi Arabia) and Guangzhou (China-PRC).000 million (US$ 1. home theatre systems and optical storage systems. Sony India Sony Corporation. Sony has its distribution network comprising of over 7000 channel partners. Toshiba had a presence in India since 1985 and was represented in India through their Liaison Office. established its India operations in November 1994. the Company was incorporated with limited liability on March 3. The company also has presence across the country with 21 company owned and 172 authorized service centers.a leading manufacturer of 16 . the company was converted into a public limited company in the same year.
2001. Industrial Components & Equipment. Sharp has a production base in 26 countries with 33 plants. The government. and its products are used in 133 countries. VCPs and audio products. Some of HIL’s product range includes Semiconductors and Display Components.consumer electronic products to manufacture VCRs/VCPs/VTDMs. Customs duty on Information Technology Agreement (ITA-1) items (217 items) has been abolished from March 2005. It is now possible to import duty-free all components and raw materials manufacture products and export it. 1. business tax incentives. LCD TVs. All goods required in the manufacture of ITA-1 items are exempt from customs duty. The products were sold under the Optonica brand name. materials and components.5 Policy and Initiatives Foreign investment up to 100 per cent is possible in the Indian consumer electronics industry to set up units exclusively for exports. Smart Boards and DVD Camcorders. The company manufactures consumer electronic goods such as TVs. LCD Projectors. and an expedited import-export process. EHTP (Electronic Hardware Technology Park) is an initiative to provide benefits to companies that are replacing certain imports with local manufacturing. Hitachi India Hitachi India Ltd (HIL) was established in June 1998 and engaged in marketing and sells a wide range of products ranging from Power and Industrial Systems. 17 . It also supports the sale of Plasma TVs. Air Conditioning & Refrigeration Equipment to International Procurement of software. VCRs. The company was accredited with the ISO-9001 certification in the month of February. in an attempt to encourage manufacture of electronics in India has changed the tariff structure significantly. EHTP benefits include export credits. no duties on imported components or capital equipment.
The Indian Copyright Act 1957 was amended in 1999. creation of a new Trademark Act. creation of a new Trademark Act. hard disc drives. The agreement on TRIPs takes care of the intellectual property rights by enforcing the patent rights. New acts have also been enacted to cover semiconductors and layout designs which will be of considerable importance to the electronic industry. a new Designs Act and amendments to the Patents Act show India’s desire to change and adapt. 18 . The Industrial Design Act 1911 was effectively replaced by The Design Act 2000.Customs duty on specified raw materials / inputs used for manufacture of electronic components or optical fibers / cables has been removed. the patent Act 1970 was amended in 1999 & 2003 and Trademarks and Merchandise Marks Act 1959 was overtaken by a new Trademark Act 1999. and the Layout Design of Semiconductor integrated Circuit Act 2000 was enacted. Several amendments to the Copyright Act. geographical indications. growth and development. trade marks. floppy disc drives and CD ROM drives continue to be exempt from excise duty. Microprocessor. The country has already made several changes in its IP acts over the years.. Customs duty on specified capital goods used for manufacture of electronic goods have been abolished. The Government of India has developed a robust IP act to facilitate innovation. copy rights and related rights. and the protection of industrial designs. Intellectual Property Rights Protection of Intellectual property rights (IPR) is a prime requisite for development of R&D and innovation in the consumer electronics sector. layout designs of integrated circuits and undisclosed information. a new Designs Act and amendments to the Patents Act show India’s continued effort to protect IPR. amended most of its IPR Acts and Rules to conform to the said Agreement. the member nations are asked to modify their existing laws. Excise duty on computers has been removed. India is a party to the “Trade Related Aspects of the Intellectual Properties (TRIPs) Agreement” and has accordingly. Several amendments to the Copyright Act. Accordingly. In the current WTO regime.
The ITA-1 would result in intensifying competition as more imported products will be easily available at lower prices.32 billion. Out of these 217 items. several items were already at NIL customs duty. During the same period the FDI inflow for electrical equipment (including computer software and electronics) was US$ 3. The consumer electronics and durables sector is expected to continue to benefit from supportive policies and become globally competitive. unauthorized use of the patented innovations. IT/electronics was the first sector in India to face complete customs tariff elimination. In fact. raw materials and components. trade marks. Regulations 1. spares and consumables. Free Trade Agreement WTO regime which came in force in 2005.Once these laws come into force. results in zero customs duty on imports of all telecom equipment. becomes difficult. which was 9.29 billion. Foreign Investment Policy: FDI Foreign investment up to 100 per cent is allowed in Indian electronics industry set up exclusively for exports. The units set up under these programs are bonded factories eligible to import. A part of the production from such units is permitted to be sold in the DTA depending upon the level of the value addition achieved. 19 . their entire requirements of capital goods. office equipment etc. free of duty. 2. Enforcement of the TRIPs agreement makes the production of any product possible either through internal innovation or through formal transfer of technologies. The FDI approval for electrical equipment (including computer software and electronics) from January 1991 to March 2004 was US$ 7.94 per cent of the total foreign direct investment (FDI) approved. etc. 217 IT/electronic items were covered under the Information Technology Agreement (ITA) of the WTO for complete customs tariff elimination by 2005. Deemed export benefits are available to suppliers of these goods from the Domestic Tariff Area (DTA).
Proposals involving foreign direct investment not covered under the automatic route are considered by the Foreign Investment Promotion Board (FIPB). predominantly owned by them.3. Procedure for approval Once the investment in equity has been approved.Resident Indians (NRIs) including Overseas Corporate Bodies (OCBs). Approval for setting up units in Export Processing Zones (EPZs) is given by the Board of Approvals in the Ministry of Commerce. FDI and foreign technology collaborations are approved through automatic route by the Reserve Bank of India 20 . to complement and supplement domestic investment. Approval of Ministry of Home Affairs is not needed for hiring foreign nationals holding valid employment visa. FDI/ Foreign Technology Collaboration Agreement The government facilitates FDI and investment from Non. Department of Information Technology. 4. Foreign technology induction is encouraged through FDI and foreign technology collaboration agreements. Approval for setting up export-oriented units (EOUs) outside the zones is given by the Ministry of Industry. Approvals for setting up Electronic Hardware Technology Park (EHTP) and Software Technology Park (STP) units are cleared by the Inter Ministerial Standing Committee (IMSC) set-up under the Chairmanship of the Secretary. the import of capital goods. components and raw materials or the engagement of foreign technicians for short duration does not require any additional approvals.
Inverted duty structure 3. But that remains a major hiccup in India. but also spend on transportation for moving inventory. at least a large proportion of its constituents. still buys black and white TVs and doesn't know what flat screens are. Companies not only have to set up the basic infrastructure in terms of office space. About 65 per cent of Indian population that lives in its villages still remains relevant for some consumer durables companies. These include: 1. Creating awareness about new technologies and products 5. ISuppli believes that there are still challenges facing the India consumer electronics industry as the sector tries to realize its full potential. have a direct presence only in 15. Poor infrastructure is another reason that seems to have held back the industry. Expansion of distribution reach: Infrastructural bottlenecks (roads. Also. This India. which are touted as having the largest distribution network in the country.000 retail outlets (for consumer durables) in the country.6 Challenges and Opportunities The Challenges Heavy taxation in the country is one of the challenges for the players. power.1. Even LG and Samsung. etc.000 to 18.) have hindered the reach of the distribution network in India 4. Regular power supply is imperative for any consumer electronics product.000 of the around 40. whereas the corresponding tariffs in other Asian countries are between 7 and 17 percent. foraying into these rural markets has a considerable cost component attached to it. At its present structure the total tax incidence in India even now stands at around 25-30 per cent. Low affordability level of consumer products among the rural masses 21 . manpower. Declining margins for many players 2.
However. The future of India's market is indeed bright. Purchase necessarily done only during the harvest. growth in disposable income. leading to increased expenses due to transportation. power availability. Opportunities The rising rate of growth of GDP. and rise in temperatures. after sales services to suit the infrastructure and the existing amenities like electricity. And looking ahead. festive and wedding seasons — April to June and October to November in North India and October to February in the South. Penetration of consumer durables would be deeper in rural India if banks and financial institutions come out with liberal incentive schemes for the white goods industry segment. these challenges are gradually being addressed. iSuppli believes that India will continue to grow as an important market for the global consumer electronics industry. improving lifestyles. Currently. rising purchasing power of people with higher propensity to consume with preference for sophisticated brands would provide constant impetus to growth of white goods industry segment. voltage etc. low running cost. rural consumers purchase their durables from the nearest towns. While the consumer durables market is facing a slowdown due to saturation in the urban market. believed to be months `good for buying’. rural consumers should be provided with easily payable consumer finance schemes and basic services. should be converted to routine regular feature from the seasonal character. 22 .
1 Introduction 23 .CHAPTER-2 Company Profile 2.
The company has also lined up Mobile Phones. The company has launched state-of-the-art wall mountable DVD Players with auto-sliding door facility.P. Laptops. TFT Screens. Air-Conditioners. These features are not available in any other brand in the country. MARKSON is the long cherished dream of Mr. Home Theatre Systems. the company has been able to make a pan India presence through a strong network of more than 100 Distributors. Parwanoo & Baddi in U. The company is headed by highly experienced team of professionals from the electronics industry who have hands-down experience in the electronics industry and enjoy a high degree of honesty and reliability among the trade. USB Playability with facility to mount DVD Players on the wall to give a unique look. After-sales-service being the mantra of the brand. DVD Players. a dream of reaching out to the teeming millions and providing them the fruits of modern technology for their education and entertainment – manufacturing the state-of-the-art electronics products in India for providing world class quality at affordable prices for the masses.SNR Electronics Ltd. which will be launched very shortly. The product mix includes LCD TVs. Set-top Boxes and Desktop computers.K & H. Colour TVs. launched the “Markson” brand of consumer electronics in January 2008. Washing Machines and Microwave Ovens. the company is in the process of opening more than 100 service outlets across the country. The company started operation in early 2008 and in a short period of one year only. Sunil Gupta. The company’s products range has been widely accepted meeting the international 24 . Quality and affordable prices are the hallmark of Markson. a Himachal Pradesh based firm. Markson products are produced in most modern and state-of-the-art plant at Haridwar. Markson brand was launched in India in technical collaboration with the UK based company for designing and technical support of their products. well supported by sales and service professionals of the company.
The LCD TV’s are having unique features like USB Playback and MMS Playback. has opened 13 branches at state level along with extensive warehousing facilities at the branches. Sunil Gupta is the CMD of Markson in India. in order to facilitate and expedite the distribution of Markson’s products in India. BETA (Bhagirath Electronics Traders Association) and 25 . We at Markson believe that high quality innovation isn’t a privilege anymore. Mr. He also plans to venture into the Hospitality sector around the same time. Desktop computers. He has held coveted positions in numerous electronics associations like. Gupta has a hands down experience in electronics trade. AirConditioners. Sunil Gupta CMD. it’s an asset.2 Vision To reinvent the market trend by bringing in state-of-the-art quality products to consumers as they have always wanted it. Since then he has been actively engaged in arranging and collaborating resources for many wholesale retail outlets in Delhi which happens to be Asia’s largest electronics trading market.3 Key People Mr. He also plans to put more home products into the market by the end of the year like Washing Machines. The company.standards in quality and packaging. Gupta is the promoter of Markson brand in India with focus on manufacturing & marketing of electronic goods like LCD TV. LCD TV’s particularly of 26” (66 cms) and 32” (82 cms) size have been sold more than the expectation leading to a virtual shortage in the market. The Markson Computer TFT Screens have unique features and inbuilt speakers and with the aid of external TV Tuner can substitute a LCD TV. Mr. Color TV. TFT screen & Set-top boxes. 2. Markson Mr. For the last 26 years. and it’s your right! 2. Home theatre systems. DVD players. his emphasis and special focus has been on trading of electronic components and assemblies. Every single product made at Markson is an epitome of precision and impeccable quality. Laptops. Microwave Ovens and Mobile Phone sets.
He has also been actively involved in construction of several dharamshalas for the needy.Tech. Gupta has done a lot of social service for the needy. Being a philanthropist to the core. He also has a sound knowledge of Customs and Central Excise Procedures prescribed under the Customs Act and Central Excise Act. helping them in whatever possible way. Wadhwani has spent considerable time in understanding export and import and their intricate procedures under the Foreign Trade Law. Mr. the CEO of Markson. namely. Mr. has an impressive experience of 35 years in the electronics industry in international trading coupled with domestic marketing and production related factory processes. 26 . ELCINA. CEAMA. He has been an active member of several important electronic associations in India. Markson is able to provide the products at cheaper rates as the facilities are located under the excise free zone and the same are passed on to the end consumers. Markson Sunil Wadhwani.Central Radio & Electronics Merchant Association. Mr. He has also been an active member of ESC. Delhi and has been actively engaged in work since then. The company's prime focus will be on Northern and Eastern regions first and then move on to the Central and Southern regions of the country. The initial investment made was Rs 100 crore. a council promoted by the Ministry of Information Technology. 2. and local Customs Advisory Committee in Delhi and Central Excise Committee in Noida. solely for the procurement of a spectrum of electronic components and goods. Wadhwani has travelled extensively all over the world. IIT. Sunil Wadhwani CEO. and also for the export of quality electronic goods from India keeping in view the international standard.4 Future Goals Markson targets revenue of Rs 400 crore by the end of this fiscal and will increase it to Rs 1. in Mechanical Engineering from the coveted technical institute. He received his B. Mr.000 crore by 2012 with the introduction of several low cost products.
will start registering profit after two years of this venture 27 . that has an initial advertising budget of Rs five crore. air-conditioners.With 2. The company. The company plans to launch washing machine. a member of Consumer Electronics and Appliances Manufacturer Association (CEAMA). will increase it to Rs 20 crore in the near future. refrigerators and microwave ovens in the next two months. The company.000 dealers and distributors across the country. the company targets to capture five cent of the television market in the country by the end of this fiscal.
CHAPTER.3 Essential Theory 3. LCD televisions are thinner and lighter than CRTs of 28 .1 Liquid Crystal Display Television Liquid-crystal display televisions (LCD TV) are color television sets that use LCD technology to produce images.
as opposed to the more random alignment of a normal liquid.similar display size. the pneumatic liquid crystals. Some of these. green or blue (RGB) portion of the light from the original white source. This forces the layers to align themselves in two directions. In the case of an LCD. The particular direction of the alignment of a pneumatic liquid crystal can be set by placing it in contact with an alignment layer or director. Each shutter is paired with a colored filter to remove all but the red. creating a twisted structure with each layer aligned at a slightly different angle to the ones on either side. Description Basic LCD Concepts: LCD televisions produce a colored image by selectively filtering a white light. Liquid crystals encompass a wide range of (typically) rod-shaped polymers that naturally form into thin layers. the individual colors blend together to produce a single spot of color. LCD shutters consist of a stack of three primary elements. The sub-pixels are so small that when the display is viewed from even a short distance. also show an alignment effect between the layers. Millions of individual LCD shutters arranged in a grid. and are available in much larger sizes as well. The 29 . open and close to allow a metered amount of the white light through. This combination of features made LCDs more practical than CRTs for many roles. and as manufacturing costs fell their eventual dominance of the television market was all but guaranteed. On the bottom and top of the shutter are polarizer plates set at (typically) right angles. a pixel. which is essentially a material with microscopic groves in it. The shade of color is controlled by changing the relative intensity of the light passing through the sub-pixels. Each shutter–filter pair forms a single sub-pixel. the layer in contact will align itself with the grooves. the bulk material taking on the director's alignment. and the display would be black. this effect is utilized by using two directors arranged at right angles and placed close together with the liquid crystal between them. and the layers above will subsequently align themselves with the layers below. Normally light cannot travel through a pair of polarizers arranged in this fashion. When placed on a director. although some displays use white or colored LEDs instead. The light is typically provided by a series of cold cathode fluorescent lamps (CCFLs) at the back of the screen.
In order to improve switching time. Since a metal electrode would be opaque. some of the field always leaks out into the surrounding shutters. which increases the force to re-align themselves with the directors when the field is turned off. a series of electrodes is deposited on the plates on either side of the liquid crystal. In general. Addressing sub-pixels: In order to address a single shutter on the display. typically indium tin oxide. but are more difficult to construct and have slightly slower response times. the other has vertical stripes that form columns. To turn a shutter off. destroying the twisted structure. In-Plane Switching displays (IPS and S-IPS) offer wider viewing angles and better color reproduction. The light no longer changes polarization as it flows through the liquid crystal. Since addressing a single shutter requires power to be supplied to an entire row and column. the amount of remaining twist can be finely selected. LCDs use electrodes made of a transparent conductor. Several other variations and modifications have been used in order to improve performance in certain applications. By controlling the voltage applied across the crystal. exiting the front of the liquid crystal having been rotated through the correct angle that allows it to pass through the front polarizer. and can no longer pass through the front polarizer. S-PVA and MVA) offer higher contrast ratios and good response times. but suffer from color shifting when viewed from the side.polarizers also carry the directors to create the twisted structure aligned with the polarizers on either side. Liquid crystals 30 . it will naturally follow the liquid crystal's twist. LCDs are normally transparent. This allows the transparency or opacity of the shutter to be accurately controlled. IPS displays are used primarily for computer monitors. By supplying voltage to one row and one column. a field will be generated at the point where they cross. the rod-shaped molecules align themselves with the electric field instead of the directors. One side has horizontal stripes that form rows. all of these displays work in a similar fashion by controlling the polarization of the light source. Vertical Alignment (VA. When this happens. As the light flows out of the rear polarizer. an electrical voltage is applied across it from front to back. the cells are placed under pressure.
The front sheet is similar. each shutter is paired with a thin-film transistor that switches on in response to widely separated voltage levels. say 0 and +5 volts. the gate line. but that voltage was too low to make the crystals realign with reasonable performance. A new addressing line. Another problem in early LCD systems was the voltages needed to set the shutters to a particular twist was very low. one set. replacing those with the patterned color filters. Using a multistep construction process. and even small amounts of leaked field will cause some level of switching to occur. Even scrolling text often rendered as an unreadable blur. is added as a separate switch for the transistors. Not only does this allow for very accurate control over the shutters.are quite sensitive. Instead of powering both electrodes. This partial switching of the surrounding shutters blurs the resulting image. and the switching speed was far too slow to use as a useful television display. is attached to a common ground. but the response time of the shutter is dramatically improved as well. a constant and relatively high amount of charge flows from the source line through the transistor and into an associated capacitor. On the rear. so pulse code modulation is used to accurately control the overall flow. since the capacitor can be filled or drained quickly. modern LCDs use an active matrix design. typically the front. The current is very fast and not suitable for fine control of the resulting store charge. the glass sheets can be replaced with plastic. When switched on. slowly leaking this through the crystal to the common ground. For smaller display sizes (under 30 inches). In order to attack these problems. The rear sheet starts with a polarizing film. but the transistors ensure that only the single shutter at the crossing point is addressed. the active matrix components and addressing electrodes. like a mouse cursor on a computer screen. This resulted in slow response times and led to easily visible "ghosting" on these displays on fast-moving images. and then the director. The capacitor is charged up until it holds the correct control voltage. but lacks the active matrix components. any leaked field is too small to switch the surrounding transistors. both sheets can be produced on the same assembly line. The rows and columns are addressed as before. the glass sheet. Building a display: A typical shutter assembly consists of a sandwich of several layers deposited on two thin glass sheets forming the front and back of the display. The 31 .
The number of discarded panels has a strong effect on the price of the resulting television sets. which "boils" electrons off its surface. LCD panels. These have a relatively high failure rate. Comparison Packaging: In a CRT the electron beam is produced by heating a metal filament. Since the electrons are easily deflected by gas molecules. and aimed at the proper location on the screen using electromagnets. The backlight for small sets can be provided by a single lamp using a diffuser or frosted mirror to spread out the light. the entire tube has to be held in vacuum. and televisions larger than this had to turn to other technologies like rearprojection. but for larger displays a single lamp is not bright enough and the rear surface is instead covered with a number of separate lamps. displays up to 40 inches were produced but weighed several hundred pounds. like other flat panel 32 . Achieving even lighting over the front of an entire display remains a challenge. The critical step in the manufacturing process is the deposition of the active matrix components. which requires ever-thicker glass. The electrons are then accelerated and focused in an electron gun. This limits practical CRTs to sizes around 30 inches. which renders those pixels on the screen "always on". To produce a complete television. The atmospheric force on the front face of the tube grows with the area. there is a small amount of vacuum in sets using CCFL backlights. but this is arranged in cylinders which are naturally stronger than large flat plates. The majority of the power budget of a CRT goes into heating the filament. Removing the need for heavy glass faces allows LCDs to be much lighter than other technologies. the shutter assembly is combined with control electronics and backlight. and bright and dark spots are not uncommon. If there are enough broken pixels. the screen has to be discarded. The lack of vacuum in an LCD television is one of its advantages.liquid crystal is placed between the two sheets in a patterned plastic sheet that divides the liquid into individual shutters and keeps the sheets at a precise distance from each other. and the major downward fall in pricing between 2006 and 2008 was due mostly to improved processes. which is why the back of a CRT-based television is hot.
As a result. After that. Efficiency: LCDs are relatively inefficient in terms of power use per display size. In spite of using highly efficient CCFLs. but improvements. As yields increased. you can see that a good portion of the screen area is covered by the cell structure around the shutters. only 8 to 10% of the light being generated at the back of the set reaches the viewer. each sub-pixel's color filter removes the majority of what is left to leave only the desired color. late in their evolution. with production yields being the primary constraint. see below). Finally. folded. even the best CRTs are much deeper than LCDs. Examining the image above. and 65" sets are now widely available. This allowed LCDs to compete directly with most in-home projection television sets. to 42". so this change can only be used to control the brightness of the screen as a whole. This system examines the image to find areas that are darker. In early sets from the 1950s the angle was often as small as 35 degrees off-axis. like the 33 . the electron gun has to be located some distance from the front face of the television. Nevertheless. CCFLs are long cylinders that run the length of the screen. especially computer assisted convergence. most sets use several hundred watts of power. and reduces the backlighting in those areas. to control the color and luminance of a pixel as a whole. in theory. because the vast majority of light that is being produced at the back of the screen is blocked before it reaches the viewer. on average. For these reasons the backlighting system has to be extremely powerful. 3M suggests that. common LCD screen sizes grew. the rear polarizer filters out over half of the original unpolarized light. To start with. allowed that to be dramatically improved and. Modern LCD sets have attempted to address the power use through a process known as "dynamic lighting" (originally introduced for other reasons. then 52".displays. be built at any size. are also much thinner than CRTs. Since the CRT can only bend the electron beam through a critical angle while still maintaining focus. which removes another portion. from 14 to 30". or at least wide horizontal bands of it. LCD televisions end up with overall power usage similar to a CRT of the same size. and in comparison to those technologies direct-view LCDs have a better image quality. This makes the technique suitable only for particular types of images. the light has to be further absorbed in the shutters. more than would be required to light an entire house with the same technology. LCDs can.
Sets using LEDs are more distributed. It’s the speed at which an LCD panels crystals “twist” to block and allow light to pass. A number of companies are actively researching a variety of approaches. which made them useless for television. most notably the ghosting on fast-moving images. For 60 frames per second video. typically a 16 by 16 patch. Another would be to direct the light that would normally fall on opaque elements back into the transparent portion of the shutters. with each LED lighting only a small number of pixels. By 2000. Early LCD displays had response times on the order of hundreds of milliseconds. In spite of many predictions that other technologies would always beat LCDs. Think of it in relation to shutter speed on a camera. massive investment in LCD production and manufacturing has addressed many of these concerns.credits at the end of a movie. which is suitable for a much wider set of images. and muddy colors. This was still not fast enough for television use. Response Time: This important specification represents the amount of time it takes for one pixel to go from active (black) to inactive (white) and back to black again. Another ongoing area of research is to use materials that optically route light in order to re-use as much of the signal as possible. poor contrast ratio. instead of absorbing the unwanted colors in a filter. G and B. A successful system would improve efficiency by three times. and 3M currently sells several products that route leaked light back toward the front of the screen. as did the active matrix techniques. common in North America. One potential improvement is to use micro prisms or dichromic mirrors to split the light into R. Image Quality: Early LCD sets were widely derided for their poor overall image quality. each pixel is lit for 17 ms before it has to be re-drawn (20 ms in Europe). This allows them to dynamically adjust brightness of much smaller areas. LCD panels with response times around 20 ms were relatively common in computer roles. A combination of improvements in materials technology since the 1970s greatly improved this. 34 .
but stop rapidly. Moreover the capacitors are not drained completely. Together. which typically requires fewer charging pulses. but halve the pulse width. This change. their existing charge level is either increased or decreased to match the new value. In older displays the active matrix capacitors were first drained. But in most cases. which was isolated to the driver electronics and inexpensive to implement. led to the first practical LCD televisions. response times fell from 20 ms in 2000 to about 2 ms in the best modern displays. NEC's solution was to boost the voltage during the "spin up period" when the capacitor is initially being charged. comparing them. improved response times by about two times. If the initial movement could be accelerated. A common method is to double the voltage. But even this is not really fast enough because the pixel will still be switching while the frame is being displayed. the technique is now widely used on almost all LCDs.A major improvement. along with continued improvements in the liquid crystals themselves and by increasing refresh rates from 60 Hz to 120 and 240 Hz. and then dropping back to normal levels to fill it to the required voltage. NEC noticed that liquid crystals take some time to start moving into their new orientation. instead. Another major improvement in response time was achieved by adding memory to hold the contents of the display – something that a television needs to do anyway. but was not originally required in the computer monitor role that bootstrapped the LCD industry. pioneered by NEC. the overall performance would be increased. the amount of time spent charging and discharging the capacitors was reduced. liquid crystals allow some light to leak 35 . the vast majority of the screen's image does not change from frame to frame. Contrast Ratio: The contrast ratio measures the capacity of a display device to produce the brightest colour and the darkest colour and it is usually expressed as a ratio of their light intensities. and then recharged to the new value with every refresh. and only resetting those sub-pixels that actually changed. delivering the same total amount of power. Named "Overdrive" by NEC. Even in a fully switched-off state. By holding the before and after values in computer memory.
it should be noted that the area of the screen that can be dynamically adjusted is a function of the backlighting source. limiting the number of discrete colors they can display. Displays using LEDs have an advantage. often as few as 256 pixels in a square area. if the backlighting is reduced by half in that area. This lack of contrast is most noticeable in darker scenes. because each LED typically lights only a small patch of the screen. The CCFL must be driven with enough power to light the brightest area of the portion of the image in front of it. allowing the contrast ratio across the screen to be dramatically improved. modern sets can use "dynamic backlighting" to improve the contrast ratio and shadow detail. However. This limits their contrast ratios to about 1600:1 on the best modern sets. The accuracy and quality of the resulting colors are thus dependent on the backlighting source and its ability 36 . CCFLs are thin tubes that light up many rows (or columns) across the entire screen at once. a conventional set will have to set its shutters close to opaque to cut down the light. mentioned earlier). the LCD shutters have to be turned to almost full opacity. However. which is why many reviews of LCD TV's mention the "shadow detail".through the shutters.000:1. in order to display a color close to black. this technique cannot be used successfully. If a particular area of the screen is dark. and the number of available shuttering levels in the sub-pixels doubles. While the LCD shutters are capable of producing about 1000:1 contrast ratio. This allows the dynamic backlighting to be used on a much wider variety of images. Color gamut: Color on an LCD television is produced by filtering down a white source and then selectively shuttering the three primary colors relative to each other. Since the total amount of light reaching the viewer is a combination of the backlighting and shuttering. and that light is spread out with diffusers. the shuttering can be reduced by half. by adding 30 levels of dynamic backlighting this is improved to 30. This leads to "posterizing" effects and bands of discrete colors that become visible in shadows. so if the image is light on one side and dark on the other. This is the main reason high-end sets offer dynamic lighting (as opposed to power savings. when measured using the ANSI measurement.
Meanwhile. meant that older technologies like CRTs maintained a footprint in spite of their disadvantages. so CRTs faced the twin problems of becoming larger and more rectangular at the same time. plasma displays never saw the massive scaling of economies that were expected. was widely considered to be unable to scale into the same space. the much higher resolutions these new formats offered were lost at smaller screen sizes. Contrary to early optimism. and from the mid-1990s the plasma display was the only real offering in the high resolution space. the wider 16:9 aspect ratio of the new material was difficult to build using CRTs. LCDs started to experience the economies of scale that plasmas 37 . plasma displays were the primary high-definition display technology. The CCFLs used in early LCD televisions were not particularly white.to evenly produce white light. and tended to be strongest in greens. LCD technologies like Overdrive started to address their ability to work at television speeds. or SDTV). Initially produced at smaller sizes. their high cost. High definition: High-Definition Television (or HDTV) is a digital television broadcasting system with higher resolution than traditional television systems (standard-definition TV. In particular. however. and sets commonly quote a color space covering about 75% of the NTSC 1953 color gamut. and as the aspect ratio becomes more rectangular it becomes more difficult to make the tubes. especially at higher resolutions. LCD. and it was widely believed that the move to highdefinition would push it from the market entirely. Through the halting introduction of HDTV in the mid-1990s into the early 2000s. ideally a CRT should be perfectly circular in order to best contain its internal vacuum. Modern backlighting has improved this. fitting into the low-end space that plasmas could not fill. However. and remained expensive. At the same time. LCDs of the era were still not able to cope with fast-moving images. Using white LEDs as the backlight improves this further. It was the slow standardization of high definition television that first produced a market for new television technologies. This situation changed rapidly. both manufacturing and on the street.
It was the only technology that could scale both up and down in size. and shut down the final plant in March 2008. Plasma had overtaken rear-projection systems in 2005. which made up for the price difference. several vendors were offering 42" LCDs. So they can improve so quickly. so many companies. and even a price advantage for sets at the critical 42" size and larger. LCD's dominance in the television market accelerated rapidly. The same was true for CRTs." When the sales figures for the 2007 Christmas season were finally tallied. covering both the high-end market for large 38 . More critically. The February 2009 announcement that Pioneer Electronics was ending production of the plasma screens was widely considered the tipping point in that technology's history as well. encroaching on plasma's only stronghold. so many people have been working in this area. but as the president of Chunghwa Picture Tubes noted after shutting down their plasma production line. albeit at a price premium. and in 2007 the last remaining consumer rear-projection systems were gone. This evolution drove competing large-screen systems from the market almost overnight. By 2004. LCDs offer higher resolutions and true 1080p support. pundits were surprised to find that LCDs had not only outsold plasma. Predictions that prices for LCDs would drop rapidly through 2007 led to a "wait and see" attitude in the market. "Globally. By late 2006. but also outsold CRTs during the same period. Plasmas and LCDs reached price parity in 2007. Sony ended sales of their famous Trinitron in most markets in 2007. while plasmas were stuck at 720p. it was clear that LCDs were going to outsell plasmas during the critical Christmas sales season. 32" models were widely available. on this product. Market Takeover Although plasmas continued to hold an obvious picture quality edge over LCDs. This was in spite of the fact that plasmas continued to hold an image quality advantage.failed to achieve. By late 2007. LCD prices started falling rapidly in 2006 while their screen sizes were increasing at a similarly furious rate. at which point the LCD's higher resolution was a winning point for many sales. and sales of all large-screen televisions stagnated while customers watched to see if this would happen. so many investments. which lasted only a few months longer. 42" sets were becoming common. and much larger prototypes were being demonstrated.
Price: 3. NF3 is a potent greenhouse gas. As NF3 was not in widespread use at the time. Building across these wide scales quickly pushed the prices down across the board. Promotion: Informing potential customers of the availability of the product. as well as customers looking to replace their existing smaller CRT sets in the 14 to 30" range. and its extensive half-life may make it a potentionally harmful contributor to global warming. Furthermore.screens in the 40 to 50" class. There are four critical elements in marketing your products and business. The right product at the right price available in the right place to be bought by customer. 4. the report failed to compare NF3's effects with what it replaced. In reality. A report in Geophysical Research Letters suggested that its effects were theoretically much greater than better-known sources of greenhouse gasses like carbon dioxide. of which anywhere from 30% to 70% escapes to the atmosphere in typical use." Critics of the report point out that it assumes that all of the NF3 produced would be released to the atmosphere. two earlier studies found that only 2% to 3% of the gas escapes destruction after its use. 39 . Place: The right product offered at the right price. the vast majority of NF3 is broken down during the cleaning processes. Environmental effects The production of LCD screens uses nitrogen trifluoride (NF3) as an etching fluid during the production of the thin-film components. 2. another powerful greenhouse gas. Product: The right product to satisfy the needs of your target customer. 1. 3. it was not made part of the Kyoto Protocols and has been deemed "the missing greenhouse gas.2 Marketing Mix Marketing your business is about how you position it to satisfy your market’s needs. its price and its place. perfluorocarbon. They are the four P’s of marketing.
design. Think long term about the venture by planning for the ways one can deepen and broaden the product bundle. and customer service. Thus. services. features. Other product attributes include quality. there are elements associated with the product that customers may be attracted to. warranties. one may be able to take advantage of opportunities to add value through processing. For instance. and distribution methods are similar. Later growth may occur in the same location or may be in different geographic regions. options. packaging. 40 . Product “Product” refers to the goods and services you offer to your customers. with the business offering related products. skills and equipment.” while many basic products must be positioned for price conscious consumers. a luxury product should create just the right image for “customers who have everything. Product’s appearance. which means one does not have to acquire new suppliers. one must think of what one can offer as a bundle of goods and services. Other future growth may allow offering the product to different customers. Other important aspects of product may include an appropriate product range. production processes. For example. Customer research is a key element in building an effective marketing mix. such as the way it is packaged. A different type of growth would be a diversification of products. and support make up what the customer is actually buying. Start-up businesses are most successful when they concentrate their efforts on one product or one market. warranties. and brand name. Offering a whole range of products is most successful if the raw materials. function. Apart from the physical product itself. Product bundle should meet the needs of a particular target market. like a restaurant or a car service center does. or a brand name.The marketing mix should be something one has to pay careful attention to because the success of your business depends on it. and distribution methods. Successful managers pay close attention to the needs their product bundles address for customers. The knowledge of the target market and the competitors will allow offering a product that will appeal to customers and avoid costly mistakes.
This pricing structure is relatively simple to follow because you maintain you price relative to your competitors’ prices. customers will select vendors based on bids submitted simultaneously. Many small business owners feel they must absolutely have the lowest price around. In the next column are eight common pricing strategies. including non-price factors such as quality. while others are intuitive judgments. you can direct observe your competitors’ prices and respond to any price changes. and prestige. Later. Some price decisions may involve complex calculation methods. the price is decreased as the market becomes saturated. the competitive environment. However. 41 . gathering information will be more difficult. Accurately assessing fixed and variable costs is an important part of this pricing method. In some cases. • Cost-plus: Adds a standard percentage of profit above the cost of producing a product. customer demand. The result should neither be greedy nor timid. So they begin their business by creating an impression of bargain pricing. In those cases. A coupon is an example of a discounted price. Selection of a pricing strategy should be based on the product. In other cases. • Skimming: Involves the introduction of a product at a high price for affluent consumers. • Value-based: Based on the buyer’s perception of value (rather than on your costs). • Going-rate: A price charged that is the common or going-rate in the marketplace. this may be a signal of low quality and not part of the image you want to portray. healthfulness. one can follow a number of alternative pricing strategies. The buyer’s perception depends on all aspects of the product. As a manager. Determining the product’s price can be tricky and even frightening.Price “Price” refers to how much you charge for your product or service. Pricing approach should reflect the appropriate positioning of the product in the market and result in a price that covers the cost per item and includes a profit margin. • Competitive: Based on prices charged by competing firms for competing products. Going-rate pricing is common in markets where most firms have little or no control over the market price. and the other products you will offer. • Discount: Based on a reduction in the advertised price.
After deciding the pricing strategy. • Price differences among geographic areas: Pricing variance among geographic regions. • Psychological: Based on a price that looks better. $4. ultimately it must cover costs. for example. The research needed to understand the pricing along the distribution path will be more than worth the time it takes. such as maintaining an in-store display.99 per pound instead of $5. One will also have to decide how to determine: • Payment period: Length of time before payment is received. • Allowance: Price reductions given when a retailer agrees to undertake some promotional activity for you. The methods discussed here should be a base from which to construct your price. • Volume discounts and wholesale pricing: Price reductions given for large purchases. • Trade discounts (also called “functional discounts”): Payments to distribution channel members for performing some function such as warehousing and shelf stocking. Whatever the price may be. Tracing the path of the product from production to final purchase is a useful exercise to discover this information. contribute to the image by communicating the perceived value of the 42 . • Credit terms: Policies that allow customers to pay for products at a later date. • Bundling of products/services: Offering an array of products together. • Seasonal allowances: Reductions given when an order is placed during seasons that typically have low sales volumes to entice customers to buy during slow times. • Cash and early payment discounts: Policies to speed payment and thereby provide liquidity. The options will vary depending on how one chooses to sell your product. the amount of money actually received may be complicated by other pricing aspects that will decrease (or increase) the actual amount of money received.00 per pound. • Price differences among target customer groups: Pricing variance among target markets.• Loss-leader: Based on selling at a price lower than the cost of production to attract customers to the store to buy other products. • Price flexibility: Ability of salesperson or reseller to modify price.
product, counter the competition’s offer, and avoid deadly price wars. Remember, price is the one “P” that generates revenue, while the other three “P’s” incur costs. Effective pricing is important to the success of the business. Place “Place” refers to the distribution channels used to get the product to the customers. What the product is will greatly influence how to distribute it. If, for example, one owns a small retail store or offer a service to the local community, then one is at the end of the distribution chain, and so one will be supplying directly to the customer. Businesses that create or assemble a product will have two options: selling directly to consumers or selling to a vendor. Direct Sales As a producer, one must decide if supplying direct is appropriate for the product, whether it be sales through retail, door to- door, mail order, e-commerce, on-site, or some other method. An advantage of direct sales would be the contact one gains by meeting customers face to face. With this contact one can easily detect market changes that occur and adapt to them. One also have complete control over the product range, how it is sold, and at what price. Direct sales may be a good place to start when the supply of the product is limited or seasonal. For example, direct sales for many home-produced products can occur through home based sales, markets, and stands. However, direct sales require that you have an effective retail interface with the customers, which may be in person or electronic. If developing and maintaining this retail interface is not of interest to you or you are not good at it, you should consider selling through an intermediary. Reseller Sales Instead of selling directly to the consumer, one may decide to sell through an intermediary such as a wholesaler or retailer who will resell the product. Doing this may provide with a wider distribution than selling direct while decreasing the pressure of managing own distribution system. Additionally, one may also reduce the storage space necessary for inventory. One of the most important reasons for selling through an
intermediary is access to customers. In many situations, wholesalers and retailers have customer connections that would not be possible to obtain on your own. However, in selling to a reseller one may lose contact with your end consumer. In some cases, one may also lose some of your company identity. For example, your distributor may request that your product be sold under the reseller’s brand name. One factor that may influence whether you can find an intermediary to handle your product is production flow. Wholesalers want a steady year-round supply of product to distribute. If you can deliver a steady year-round supply that is of consistent quality, then selling through an intermediary may be a good strategy for you.
Market Coverage No matter whether you sell your product direct or through a reseller, you must decide what your coverage will be in distributing your product. Will you pursue intensive, selective, or exclusive coverage? Intensive distribution is widespread placement in as many places as possible, often at low prices. Large businesses often market on a nationwide level with this method. Convenience products—ones that consumer buy regularly and spend little time shopping for, like chewing gum—do better with intensive (widespread) distribution. Selective distribution narrows distribution to a few businesses. Often, upscale products are sold through retailers that only sell high-quality products. With this option, it may be easier to establish relationships with customers. Products that people shop around for sell better with selective distribution. Exclusive distribution restricts distribution to a single reseller. You may become the sole supplier to a reseller who, in turn, might sell only your product. You may be able to promote your product as prestigious with this method, though you might sacrifice sales volume. Specialty products tend to perform better with exclusive distribution. Other Place Decision Product characteristics and your sales volumes will dictate what inventories to maintain and how best to transport your products. Additionally, the logistics associated with acquiring raw materials and ensuring that your final product is in the right place at the
right time for the right customers can comprise a large percentage of your total costs and needs careful monitoring. You may decide to have a combination of all the distribution methods. Whatever you decide, choose the method which you believe will work best for you. Promotion “Promotion” refers to the advertising and selling part of marketing. It is how you let people know what you’ve got for sale. The purpose of promotion is to get people to understand what your product is, what they can use it for, and why they should want it. You want the customers who are looking for a product to know that your product satisfies their needs. To be effective, your promotional efforts should contain a clear message targeted to a specific audience reached via an appropriate channel. Your target audience will be the people who use or influence the purchase of your product. You should focus your market research efforts on identifying these individuals. Your message must be consistent with your overall marketing image, get your target audience’s attention, and elicit the response you desire, whether it is to purchase your product or to form an opinion. The channel you select for your message will likely involve use of a few key marketing channels. Promotion may involve advertising, public relations, personal selling, and sales promotions. A key channel is advertising. Advertising methods to promote your product or service include the following. • Radio: Radio advertisements are relatively inexpensive ways to inform potential local customers about your business. Mid-to-late week is generally the best time to run your radio ad. • Television: Television allows access to regional or national audiences, but may be more expensive than other options. • Print: Direct mail and printed materials, including newspapers, consumer and trade magazines, flyers, and a logo, allow you to explain what, when, where, and why people should buy from you. You can send letters, fact sheets, contests, coupons, and brochures directly to new or old customers on local, regional, or national levels.
Other programs might focus on educating customers through seminars or reaching them through trade shows. Public relations (PR) usually focus on creating a favorable business image. • Word of Mouth: Word of mouth depends on satisfied customers (or dissatisfied customers) telling their acquaintances about the effectiveness of your products. incentives.• Electronic: Company Web sites provide useful information to interested consumers and clients. place. decisions on one element will influence the choices available in others. Additional sources of promotion may be attending or participating in trade shows. News stories. but these will 46 . Direct e-mail contact is possible if you have collected detailed customer information. So you should make efforts to target personal selling carefully. For instance. price. coupons. being involved in the community. and rebates. • Generic: Generic promotion occurs when no specific brand of product is promoted. generic advertising is commonly found for milk. Salespeople can tailor communication to customers and are very important in building relationships. prizes. and promotion—should work together in your marketing mix. and networking socially at civic and business organizations. Sales promotions are special offerings designed to encourage purchases. Password-protected areas allow users to more intimately interact with you. but rather a whole industry is advertised. can be good sources of publicity. Selecting an effective mix for your market will take time and effort. contests. While personal selling is an important tool. often initiated through press releases. Your target audience may be more receptive to one method than another. setting up displays at public events. and pork. beef. loyalty programs. Important components of a good public relations program include being a good neighbor. Often. Personal selling focuses on the role of a salesperson in your communication plans. and providing open house days. Final Comment The four P’s—product. Advertisements allow broad promotion of your products. Promotions might include free samples. it is costly.
you might think safety. The fact that you remember the brand name and have positive associations with that brand makes your product selection easier and enhances the value and satisfaction you get from the product. and indeed become the organization's most valuable assets. or the essence of brand has changed. you might think "Big Blue. the functions. creating the impression 47 . emotional. Once you have a good marketing mix—the right product at the right price. term. Marketing is a part of your venture that will never end. However. 3. how they define their aspiration and enable them to do more. and symbol. The objective of brand has become more of emotional and psychological than that of mere recognition and differentiation for which the concept of brand came into existence. the definition. Marketers engaged in branding seek to develop or align the expectations behind the brand's experience. Understanding Branding and Building Brand. When you think Volvo. offered in the right place and promoted in the right way—you will need to continue to stay on top of market changes and adopt your marketing mix as necessary. how they reflect and engage them.3 Branding Process The Branding Process can be explained by dividing it into two parts namely. and cultural image that you associate with a company or a product." Or "Yeh Dil Mange More" of Pepsi." When you think IBM. Powerful brands can drive success in competitive and financial markets. With time. design. you might think of an advertising campaign prompting "Just Do It. The worksheets that follow will help you construct your marketing plans. In functionality and contextually they are proprietary visual. When you think Nike. rational. today it is what they do for people that matters much more. Understanding Branding What is a brand? Brands were originally developed as labels of ownership: name.pay off as you satisfy customers and create a profitable business.
A positioning statement tells. Brand management performed to its full extent means starting and ending the management of the whole company through the brand. This art of creating and maintaining a brand is called brand management. It requires to follow certain principles and should have a developed procedure along with wellsupplemented research base. It also reaches all the way down the company and especially to the people who interface with customers or who create the products that customers use. promoting and communicating the image to the targeted audiences. A brand is therefore becomes one of the most valuable elements in an advertising theme. which uses well-defined and established principles but can be refined as well as mastered by practice. 48 . visuals and even the appeal selected revolves around the image and helps in integrating. support and contribution from everybody in the company. One of the key tasks of Brand Management is development of brand's image. What makes up a brand identity? Brand identity includes brand names. This starts with the leaders of the company who define the brand and control its management. All these discussed issues make branding a real art. and brand personality. It is something that influences all of us in several ways and leaves a deepening impact on all of us. Brand Management A powerful tool like a brand cannot be created in a vacuum or from thin air. A good brand name gives a good first impression and evokes positive associations with the brand. Brand management is a philosophy and a total approach to managing companies. what benefits it provides and why it is better than the competition. in one sentence. whereby the personality usually a celebrity or image is "branded" into the consciousness of consumers. brand associations. and as such includes much about changing minds. The personality and theme.that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. what business the company is in. A brand image may be developed by attributing a "personality" to or associating an "image" with a product or service. logos. It is a comprehensive effort and requires commitment. Brand management starts with understanding what 'brand' really means. positioning.
a character (the Nirma Girl or Amul Girl). starting with the yellow arches. It is advised to senior executives. 49 . an animal (the Merrill Lynch bull) or an image (Hum Hai Na . this premium provides important information about the value of the brand. However. How do we determine our brand identity? Brand has been called the most powerful idea in the commercial world. Then. etc. For example. a family entering the restaurant. McDonalds television commercials are a series of one brand association after another. Happy Meal. By consistent repetition of the most persuasive selling messages. pound that message home in every ad. in communications with employees and in every sales call and media interview. 100 more for a branded product over the unbranded product.One way to measure brand equity is to determine the price premium that a brand commands over a generic product. consistent food quality. lots of fun and following with associations of Good Quality reasonably priced Burgers. There are at least three perspectives from which to view brand equity: Financial .Brand personality adds emotion. culture and myth to the brand identity by the use of a famous spokesperson (Sharukh Khan – Hyundai Santro). CEOs and small-scale enterprise owners to research their customers and find the top ranked reasons due to which customers buy their products rather than their competitors. The brand can add significant value when it is well recognized and has positive associations in the mind of the consumer. expenses such as promotional costs must be taken into account when using this method to measure brand equity.ICICI). if consumers are willing to pay Rs. Brand associations are the attributes that customers think of when they hear or see the brand name. This concept is referred to as brand equity. customers will think of you and buy from you when they are deciding on whether to buy from you or your competitor. a children's party. yet few companies consciously create a brand identity. Ronald McDonald. What is Brand Equity? Brand equity is an intangible asset that depends on associations made by the consumer. kids. in every news release.
Increases cash flow by increasing market share.A successful brand can be used as a platform to launch related products. The consumer's awareness and associations lead to perceived quality. The benefits of brand extensions are the leveraging of existing brand awareness thus reducing advertising expenditures. Furthermore. poor image or communication and better brand and image of competitor's product. brand equity is not always positive in value. Negative brand equity can be measured by surveys in which consumers indicate that a discount is needed to purchase the brand over an unbranded product. However. and allowing premium pricing. inferred attributes.Brand extensions . Strong brand equity provides the following benefits: • • • Facilitates a more predictable income stream (higher profitability). and a lower risk from the perspective of the consumer. appropriate brand extensions can enhance the core brand. Brand equity is an asset that can be sold or leased. low quality of product. brand loyalty. and eventually. Brand Elements Brand elements are the components or constituents of brand that are designed and put together to strengthen brand's image. This may happen due to out-dated product. reducing promotional costs. Some brands acquire a bad reputation that results in negative brand equity. Any brand will consists of following elements: • • • • Brand name and logo Symbol and character Packaging Slogan There are five criteria to judge whether these are good brand elements: 50 . Consumer-base . Continuous fall in sales is the biggest indication of negative brand equity. Attitude strength is built by experience with a product.A strong brand increases the consumer's attitude strength toward the product associated with the brand.
packaging. use of registered trademark. slogan all should be catchy and flexible over time. symbol. • In addition. packaging indentations etc. The brand name should also connote what does product stands for. They should represent what the company. They should not look time beaten neither they should be changed frequently. the transferability of brand elements should be high. Examples of Brand Attributes: • • • • • • • Influential Innovative Inclusive Relevant Connecting Leadership Humane Is branding just for large companies? 51 . It should be simple. • The logo. Brand Attributes Brand attributes are functional or emotional associations that are assigned to a brand by its customers and prospects. • The symbol and character being used as brand elements should also gel well with product features and characteristics and they should be in good term to identify the product with. and they should communicate a unified message that depicts or supports the brand image. logo. symbols.• The recall value of Brand name should be high. easy to pronounce and easy to understand. the brand stands for. • Brand name. Brand attributes can be either negative or positive and can have varying degrees of relevance and importance to different customer segments. The elements should have adaptability and should be able to change as per demand of time and consumers. It should provide company with a viable option to create brand extension or brand line expansion or it should generate sufficient recognition for the company. It should create a connection between the need of the consumer and the product. Intellectual property protection is the fifth criteria. There should be some consistency and they should be used for several years before they are changed. all should be protected.
lifestyle and status. can use this process rather they should do it and they should consider branding expenditure as longterm investment or a capital investment. successful branding programs begin with superior products and services. The Importance of Branding 52 . service businesses. which will fetch them hefty returns in long time frame. backed by excellent customer service that permeates an entire organization. Retailers. It is the name attached to a product or service." Nothing happens until somebody sells something. It has become the crux of selling in the new economy. organization or product. Branding is something that every one needs and can be applied to any business. In short. However. fancy packaging or public relations will help you achieve your sales goals. It creates in the mind of customers and prospects the perception that there is no product or service on the market that is quite like yours. If the old marketing mantra was.NO! It is one of the myths that only large business house or the player in an industry with excess competition needs a brand. The techniques of branding have been kept secret for many years because it provided a competitive advantage to those companies that used it or devoted regular cash flow streams towards this effort. upon close inspection. then. Therefore." In its simplest form. a brand represents many more intangible aspects of a product or service: a collection of feelings and perceptions about quality." the new philosophy could be" Nothing happens until somebody brands something. image. However. a brand offers the customer a guarantee and then delivers on it. no amount of advertising dollars. a brand is a noun. manufacturers and businesses of all types and sizes. You might infer. that if you build a powerful brand. you will in turn be able to create a powerful marketing program. Brand Building Overview Branding is more than just a business buzzword. if you can't convince customers that your product is worthy of purchasing.
when your child wants a hamburger.One of the truths of modern business is that there is almost nothing that your competitors can't duplicate in a matter of weeks or months. he will often say he wants to go to McDonald's. trucks." says Howard Kosgrove. patents. "A brand is the one thing that you can own that nobody can take away from you. Scotch is the brand that springs to mind. Creating a strong brand identity will build mind share — one of the strongest competitive advantages imaginable. "What competitive edge do I have to offer that cannot be copied by anyone else?" The answer? Your brand. You would then identify the cost of the factories. you would begin to value the firm by looking at the assets tied to the Marlboro brand. If you have a great idea. machines and staff. they can steal. customers will think of your business first when they think of your product category. They can steal your trade secrets. or the worth of the brand. more likely than not. For example. if you owned the Marlboro Company and wanted to sell it. For instance. And not only will they follow your lead. you think of the Kleenex brand. unlike other abstract marketing notions. but they may also be able to do a better job or sell the product or service at a lower price. Eventually. can be quantified. When Should You Brand? 53 . your patents will expire. And when you're looking for tape to wrap a present. Likewise." says Kosgrove. Wis. when you think of tissues. As a result." They are worth a small fraction of what you can sell that brand for. Technology will change. "The value of that brand is huge compared to those actual physical assets. Stone and Briggs Advertising in Madison. It creates a lasting value above and beyond all the other elements of your business. It is often the brand that a business owner has to sell in such cases. Brand equity. you can be certain that somebody will copy it before long. The question then becomes." The importance and value of branding becomes apparent when an entrepreneur wants to sell his or her company or take it to Wall Street for a public offering or other infusion of capital. Your physical plant will wear out. "Everything else. vice principal of marketing at Lindsay." That value is often called brand equity. The reason behind these strong brandproduct associations is that these companies have built rock solid brand identities. But your brand can go on and live.
no one brand is going to appeal to all customers. On the contrary. By definition. Other industries in which branding is a must include: • • • • • • • • • Fast food High-tech Beverages Packaged Goods Petroleum Entertainment Retail Auto Pharmaceutical Types of Brands A brand cannot be all things to all people. are being forced to continue to brand heavily — perhaps even more strategically than they ever have in the past. Primary brands typically garner a large percentage of a company's revenue potential and therefore need to 54 . Brands can be separated into three categories: primary. Although most industries and products or services can benefit from a brand. not every product needs its own stand-alone brand. improbably one of the best knew industrial branded products. For example. which were one of the last frontiers. a DuPont fiber. are even beginning to see the importance of branding by tagging banking packages and even mutual funds with catchy names. including fashion. This is why many brands broaden and widen their appeal by creating tertiary brands or line extenders. All of the traditionally brand-conscious industries. branding is based on the concept of singularity — targeting individuals in a personal manner— and therefore precludes the concept of universal appeal. where cost is usually more of a loyalty building factor. Financial services. secondary and tertiary. Tyvek.This is a company's core brand or umbrella brand. Primary Brands . has seen brand names creep in.Because of the competitive nature of business today. Even industrial markets. nearly all industries can benefit from a branded product. restaurants and consumer goods.
theta of branding is made easier. and lower prices may suggest decreased value. 55 . Tertiary brands . What Goes Into a Brand? If your product or service is new or unique. they sometimes don't sport registered brand names. higher prices may signify to consumers higher quality. Take. products that may be roughly equivalent in terms of their features need to have a brand identity that will impact consumer choice. it will be easy to manipulate customer attitudes. or "flankers. but just descriptors. a toothbrush called the Crest Deep Sweep. Secondary Brands . but it fills a need within a niche market so the company continues to manufacture it under the unregistered name Household Trash Bags." for a core brand.a component of value. it probably soon will.These are often line extenders. and Deep Sweep is the secondary brand. Brand identity is comprised of: Pricing . For example. the generic line is considered a tertiary brand for this company. but they contribute to the company's overall image in some way. Since there are no pre-existing biases toward the product or service. your product or service will have been in existence for a while and have direct competition. Line extenders are characterized by having a descriptive term that allows the base brand to be the true selling proposition and the flanker to really designate to the audience what that particular product's key feature or benefits are. usually a modifier to the brand name will suffice and strengthen the core brand. Crest is the core brand. More often. for instance.These brands typically have insignificant revenue potentials or expectations. a garbage bag manufacturer may make a generic-brand bag in addition to its flagship brand. Therefore.be given priority and have a sufficient amount of advertising in order to root them firmly. And if it doesn't. Secondary brands don't need to have their own name. The generic line may bring in minimal revenue for the company. Therefore. Therefore.
Reputation . Awareness .which impacts satisfaction.availability. Quality .differentiation from the competition.loyalty is built through long-term branding and close consumer contact.prominence in the paid and unpaid media. residual awareness and recognition. Like reputation. these may be warranted or unwarranted. often represented by qualities the consumer relates to. higher quality will translate to more satisfied customers who come back again and again to purchase your offerings. image is difficult to change once established. Presence .enduring public opinion of brand character. the higher your offering's awareness. Positioning salience . Share of market .increased market share is a direct result of a successful branding campaign.consumers may equate certain positive and negative consequences with use of your product or service. the better your sales results will be. limited distribution of a product or service may imply exclusivity to discerning consumers. which are directly related to presence. Characteristics of the Campaign Positioning is the art of creating a brand that can persuade and realistically demonstrate its relevance to a customer's daily life to become his or her regular choice. What's in a Name? A. but 56 . Positioning is not created by the marketer or the individual brand itself. In fact.Distribution . Image . which is established by a combination of all elements of the brand. which is built over time and difficult to change once established. Preference . but by how others perceive it. Benefits .top-of-mind awareness. obviously. Kosgrove says that the brand is not created by the marketer at all. Customer commitment . products or services with a highprofile market presence will lead to brand recognition and increased sales.a predisposition to buy displayed by consumers who are establishing brand loyalty.perceptions of brand traits or prototypical buyers.
"Positioning studies identify the audience according to their needs. Ask yourself: Is the identity of the brand too young for my target market? Is it too old? Is it too upscale? Promises backed by support . they create the strategic and tactical suggestions to encourage the customer to accept a particular positioning in his or her mind.Benefits need to be backed with some sort of persuasive reason to believe the product's hype. on the other hand. rather. expectations and wants. That will.The more apparent the connection is between the brand and the prospect's daily activities. Many times. For instance. is how customers ultimately decide which brands to buy and which they will discard. "Positioning is everything. Why do we believe Secret antiperspirant will keep women smelling sweet? Because "it's pH balanced for a woman." says Dettore. Relevance. for instance? Because we believe in the brand's "revolutionary" Pro-V formula that leaves hairs strong and healthy. bread and milk are not branded items. and not a man. Why do we trust Pantene shampoo. wants and desires through your brand. you will be able to more efficiently meet their needs. and despite companies' push to try and brand the two products. As you begin to understand the relationship that your customers have with your brand." 57 . or the connection that the prospect has to the brand identity. they can have a significant influence on how they are positioned. Beer and cola. such as: Relevance to a customer's lifestyle . no company has found much success building brand equity. products or services have some formula or patent that is "unique" from all the other brands out there. create trust in your brand. the greater the chances are that the prospect will buy that product. To position your offering properly. you need to identify the key attributes or benefits that represent the value of your product or service. they usually choose what is on sale or what is available on their local grocer's shelves.rather by the customer. Those drivers then come into developing products and services that best fit those audiences' needs and wants. are heavily branded product categories: Consumers have formed a relationship with and will search out their preferred brands. Marketers don't create the positioning. Several characteristics can work in a positioning campaign. When customers want either one of those staple items." While marketers do not literally position brands. in turn.
but told you nothing about the product or service." The copy line helps reinforce that this brand is the genuine article for that category of products. Types of Prompts in a Campaign 58 .Have you ever seen a commercial on TV that seems to come from left field? It grabbed your attention. could they be hurting." "Coke Is It" and "Always Coca-Cola. The message that you send needs to be appropriate to the product or service you are trying to brand. Ask yourself: Are my advertising messages in line with the image I'm trying to convey about my company. For instance. Pace Picante sauce tells you that they are not the brand from New York City.The Best a Man Can Get" or "Choosy Moms Choose Jif. For instance. you need to be clear about the message. financial institutions can't effectively work humor into their ads because the preconceived notion is that banks are not supposed to be fun or entertaining.No matter how brilliant a strategy you have. how can I change them to be more accurate? Message of the brand Is appropriate . AT&T's True Voice lets its customers know that they are receiving a level of clarity above what other telecommunication companies carry through their fiber optic lines. products and services? If not.Many successful companies build customer trust by claiming to be the real McCoy.Ask yourself: What promises are you making about your brand? Can my products or services follow through on those promises? Message of the brand Is clear and focused . Ask yourself: In what ways are my products and services more "genuine" than my competitors'? How can I emphasize those elements to give the brand a competitive advantage? B. the brand? Product Is the genuine article . Coke tells you that "It's the Real Thing. rather than helping. Even service companies can make claims to being the real deal. Some examples of crystal clear campaigns include "Gillette . and it seemed inappropriate for what is being sold." Ask yourself: Are my messages in line with what I want to convey about my products and services? Are there messages that can be misconstrued? If so.
and there is a great deal of interpretation and high degree of risk that is involved in choosing one positioning over the other. That's why it makes sense to look at alternative positioning types before deciding on which one you will attach to your brand. You can talk about how your product or service is better. Be aware. the next thing to look at is how you are going to lure your customer to try your brand. you become a specialist rather than a generalist. Most people think that they know a high quality product from another. for instance. and a specialist is perceived to know more. Build a powerful perception of quality. however. People say that Apple is a better product [than the PC]. but you have to get people to believe in it. that positioning prompts are not verifiable scientific hypotheses. "Somebody can come in and say. and it may be different than measured quality. "If you look at the most profitable companies in the country. But PC manufacturers will say that the PC is better because more people believe in it. Another way to build the perception of high quality is to simply attach a higher price tag to your brand. or be of "higher quality" than a generalist. A brand can evoke several different types of prompts." say the best way to increase perception of quality is to narrow the company's focus." Quality. Al Reis and Laura Reis. but all of these brands carry a perception of higher quality because of their higher prices. they explain. does a Rolex really keep better time than a Timex? Does a Mont blanc pen write better than a Cross? Do Sony radios get better reception that Sanyo's? Do Calloway Clubs really improve your golf game? Not really. 1.' Look at the computer industry. That method is called the "positioning prompt" of the brand. and you will succeed in creating a powerful brand." says Kosgrove. When you narrow a product's focus.Perception of quality is probably one of the most important elements for a brand to have and can be combined with any of the other prompts below. authors of "The 22 Immutable Laws of Branding. lies in the mind of the buyer. but in reality. 'My product is better.Once you determine the way in which you can reach your market. or the perception of quality. things are not always as they seem. For example. they have a very high perception of quality. Quality positioning . 59 .
high price is a benefit to some customers. most of the other major airlines have followed Southwest's lead by rolling out valuepriced flights under new. Calloway clubs have a bigger head than Titleist. Of course. Private supermarket labels. For instance." Jeep has created a car and branded apparel for rugged individualists. Feature-driven prompts -. but they don't necessarily improve performance. Unfortunately.One of the most effective ways to create interest in a brand is to send out a positioning prompt that resonates well with potential buyers. 60 . which was down on its luck in the overall computer marketplace.Believe it or not. packaged good brands. Sketchers equates sneakers with cool and that characteristic passes to all who wear them. 3. Today. The advantage is that the message is clear. Rolex makes a heavier watch than Timex. Relational prompts -. Value positioning -. Southwest Airlines is probably the best example of how a company has been able to offer discount prices and still keep a strong brand identity. especially cereals. In fact. items that were considered to be a good "value" meant that they were inexpensive. feature-orientated stances are often rendered useless if the competition comes out with a faster or more advanced model.Although at one time. not solely by what they sell. Mont blanc has a fatter pen than Cross. experienced a backlash when their prices rose too quickly. Each of these characteristics gives the perception of quality. brands that are considered a value are rising in popularity amongst consumers. In fact. Apple computer. that stigma has fallen by the wayside. For instance. These brands have achieved positioning based on who buys what they sell. 2. co-branded names. started asking computer users to liberate themselves from the PC camp and" Think Different. It allows the affluent consumer to obtain psychological satisfaction from the public purchase and consumption of a high end product. have found a strong market. the product or service does need to have some perk or difference to justify the higher price. 4. which introduced a breakfast cereal that aims at undercutting brands like Kellogg's or Post. as well as smart companies like Quaker. and the positioning will be credible if you stick to the facts about the product.More marketers rely on product/service features to differentiate their brands than any other method.
6. For example. for instance tells customers that "It 61 . you are buying the only real way to "Drive Safely. Packaged good brands tend to be the most frequent users of problem/solution prompts. Therefore. "Building Brand Identity: A Strategy for Success in a Hostile Marketplace. frozen meals cut meal preparation time to minutes." author Lynn Upshaw writes. problem/solution prompts show the consumer how a sticky situation can be relieved quickly and easily with the brand or service. What problem/solution campaigns lack in imagination.Underneath our capitalist driven needs to consume. Other campaigns that challenge consumers to be the judge have cropped up between car companies. "How people feel about a brand is oftentimes need. for one. anti-smoking lobbyists and the federal government for promoting an identity of cool that young people could aspire to and achieve through smoking their cigarettes.or desire based. Rivalry-based positioning -. Aspiration positioning -. many marketers play on our feelings. even between search engines on the Web. which means that emotional or psychological approaches can oftentimes be very effective as positioning prompts. or a state of mind they might like to achieve. or a person they might like to be. The now defunct Joe Camel mascot for Camel cigarettes infuriated parents. the idea of a rivalry-based position might seem redundant but many campaigns take this approach. 8. Discover credit card. Benefit-driven positioning -." because they use a new version of the Lotus Notes software program.5." Need proof? AT&T's commercials are often tearjerkers. And a new campaign from IBM has random people exclaiming. asking friends and family to "Reach Out and Touch Someone." 9. Laundry detergents. positioning deals with how one brand is thought of compared to its obvious competitors.These are positioning prompts that offer prospects a place they might like to go." I am Superman. Warm and fuzzy positioning -. Problem/solution prompts -. they usually make up for in directness and credibility. As such. 7. In the book.Other brands base their entire positioning on the fact that they give back to the consumer.As the name implies. we are still docile and emotional animals. are constantly going head-to-head to prove which one has the most power to lift stains. Detergents and cleansers also make good use of these prompts." Volvo hints that through purchasing their Swedish import cars.By definition. garbage bags.
Now nearly all credit cards offer some type or reward. If you sell computers. Discover was among the first major credit cards companies to provide its users with a financial incentive for using their card. be it frequent flier miles. for example. Similarly.Pays to Discover. discounts on gas or store purchases. ask yourself what business you are really in. The team members must be clear on what customer benefits are being offered and how they are based on real life needs and desires. you maybe in the business of: • • • • Information Speed Convenience Technology If you sell travel packages. determine what the benefits are for your products and services. your marketing team should be able to describe a precise customer benefit that can be addressed in some way by the brand. you may be in the business of: • • • • Tourism Recreation Entertainment Stress-reduction Next. have them answer the following questions: • • • • • Who are your competitors and how are they positioning their brands? What can you offer that is different? Who would buy our product or service? What markets should we target with our brand? Do we need to register trademarks for our products or services? 62 . After completing the necessary research and reviewing the relevant examples of positioning. To accomplish this. C." Use the card and get money back. Determining Which Position Will Work for Your Brand To determine which position will work best for your company. focus on relevant reality-based customer benefits.
is the brand because the personality and the interest of the founder is going to have a lot to do with the way that the company is perceived by others. for an entrepreneur to create a brand that is a 180-degree turn against what the founder is like. good or bad. "A brand is everything that your customers know about you." One entrepreneur whose personality permeates every aspect of his brand is Nicholas Graham. how will we overcome them? • • • • Building Brand Personality Brands that carry with them a true persona. small-company brands usually take on the personality of the entrepreneur who owns them. what are they? How much advertising support are we going to need for the brand and how much will it cost? Does our budget allow for those costs? How descriptive is the brand? Are there ways that it can be improved? Can the brand name be pronounced easily? Does it translate well into other languages? Are there regulatory issues? If so. In such cases. Therefore. and help forge an emotional link that binds the buyer to the brand for years to come. it's hard not to like someone with a good personality. to a large extent. founder of Joe Boxer. who is best known for unorthodox marketing antics like shooting an underwear- 63 . if the founder is a high adventure sports enthusiast. the brand will probably not be the favorite of a conservative investment banker. The off-beat.• Are there extension opportunities for these branded products or services? If so. According to Kosgrove. It's hard. An entrepreneur or founder. In matters of branding. reinforce the purchase decision. An attractive brand personality can pre-sell the prospect before the purchase." says Kosgrove." writes Upshaw. and the beliefs and experiences similar to a personality make a brand rise to a new level. he says. a personality helps to humanize an otherwise inanimate object or service so that a prospect's defenses are lowered. After all. Every contact they have with you helps to build that brand. humorous line of boxer shorts and loungewear that the company produces bears the distinctive image of the zany Graham himself. "you are more willing to overlook flaws and search for strengths.
a brand with a distinctive personality presents the would-be buyer with something he or she can relate to as an individual." show that the brand is trustworthy and their brands reflect the same attitude.laden rocket into space and holding an undergarments "fashion show" on a transatlantic flight on Virgin Airways. Prudential's "The Rock" and Allstate's "You're in good hands.Other brands like to show that the people who use the brands are people that you could be friends with. these generations are also skeptical of marketers and are keenly aware of when a brand is targeting them. Even more important. particularly when there are few product or service features that are different between competing brands. 64 . relate to. packaged products often take on a personality that consumers can relate to. A brand's personality can offer the single most important reason why one brand will be chosen over another. The personality. Provider-driven . Although a strong identifiable personality is not imperative. products come to life to give consumers more than just a brand to trust. Image of the user . Brands that lean heavily on the provider image include insurance companies and financial institutions.As strange as it may sound. Image of the product or service . the Pillsbury Doughboy's laugh reinforces that the product will make your family feel good. or want to be like. Whether through a mascot or an animated figurine.Provider-driven images are popular with services because there is a greater need to build confidence between the provider and seller since there is usually an intangible product on the table. Personality is usually shown in three ways. is much more real than the other aspects of the brand because it is the outstretched hand that touches the customer as an individual. For instance. a practical prerequisite for success in an increasingly individual-driven marketplace. it can make it easier for customers and prospects alike to understand what the marketer has to offer. The personality gives the consumer something to relate to that can be more vivid than the perceived positioning of the brand. However. but also a face. in some ways. Many companies with branded products geared toward Generation X and Y use this tactic.
Co-branding works because it creates new excitement for the brands involved. their question is. For instance. And financial companies have even jumped on the bandwagon. The larger company receives the added benefits from the smaller company's product. Check that your potential partner is not only compatible with your product but also that it won't eclipse your own brand. co-branding is a way for businesses to extend their brand's identity and cut expenses by partnering with compatible products and services. one partner in every co-branding partnership will receive more attention than its counterpart. On the Web. before you jump into a co-branded relationship. No two brands have exactly the same impact on the consumer. And Betty Crocker uses real Hershey's chocolate in their brownie mix. but the smaller company's brand doesn't really receive much attention. Intel's Pentium Processor campaign has-been so successful that many computer buyers don't care whether they have an IBM or Hewlett-Packard or Dell computer. However. or what is better known as strategic relationships.L. Therefore. Sometimes a co-branding strategy isn't as advantageous as it may seem. Intel has been so successful at marketing their brand that the industry now benchmarks the performance of other semiconductor chips based on Pentium by calling them Pentium-like Processors. co-branding. If that risk 65 . A slew of credit card companies has-been teaming up with retailers to offer co-branded items such as the L.Strengthening Your Core Brand A. Besides content swaps. For instance. particularly for small companies that oftentimes get overshadowed by larger partners. "Does it have Intel inside?" In fact. Bean credit card. Tropicana and Chiquita have made numerous fruit juice concoctions by blending their respective specialty flavors. One brand teams with another to offer a product with an enhanced (or seemingly so) benefit. Instead. companies invite branded products and services to be sold from their sites in what are known as affiliate programs. ask yourself if the excitement that the deal will bring will build the brand or sabotage it. are rampant. Co-Branding Although it has become somewhat of a fad amongst companies.
66 . and in what way they are relevant to the realities of the consumer's everyday life. B. Store salespeople can wear pins alerting customers to ask them about the new software features. Support staff can tell current users that there is a new version available when they call for help or service on the older version of the software.is accurately assessed and accepted by the junior partner and it's still a net gain for its brand identity. • • • • Brand Pep Boys Example Brand Identity Contract Follow-up phone call after servicing the car. if a software company comes up with a new version of one of its programs. "It's the marketing team's job to prioritize identity contacts and to judge how they might contribute to the brand's identity. For example. For example: • The product's packaging can be reprinted so that bursts highlighting a "New" or "Improved" version of the program. Contribution to Brand Identity Reminder that the auto maintenance shop cares about customer service. A press release can be generated about how programs need to keep pace with the demands of the workplace and provide proper functionality. As you can imagine. opportunity to remind customer of upcoming sales. more can be done than just change a copy strategy and run new advertising. nearly all of the brand identity contacts can be manipulated to increase emphasis on the new functions of the software. Identity Contact Identity contact is the sum total of all information and experiences that a customer or prospect has with a brand. then the partnership is sound. there are many different ways that a customer can have contact with a brand in such a way that it communicates his or her identity. The company can highlight the new product at trade shows or conventions." writes Upshaw. method to check up on efficiency/courtesy of service department.
Vans. says Kosgrove. The sneaker company has become synonymous 67 . and we are going to prove it. When a customer enters the showroom. we are going to sell the company's brand. a shoe company in Santa Fe Springs. not slick. GM's Saturn is one brand that has been able to establish the commitment of the brand before a customer even walks into the showroom. And when there is a service problem. Brand-name registration in compelling way. they give coffee and doughnuts to the people when they come in. Advertisements with athletes of Olympic or star stature. 'We are not going to sell the car. revisable numbers send signal that MCI is on top of what's happening in prices. Brand associated with the best athletes in their sport. In addition to its humanitarian value.. Close-up of Nike logo on shoes of player in NBA championship or on Tiger Woods in PGA Gold Tours.' They do that by making sure that every point of contact with a customer is going to be completely different. Electronic billboard tabulating how much MCI customers have saved by using its services. is that the brand is known as just what they said it was — "A Different Kind of Car Company"— even though they are still selling the same products that every other car company is. C. instead of being crabby with them and making them wait.'" says Kosgrove. RM houses remind parents of McDonalds' commitment to the American family.McDonald's Ronald McDonald Houses for the families of seriously ill children. reinforcement of superior quality or product and prestige of being worn by winners. Grassroots Grassroots marketing is a form of branding that has really hit its stride in the last few years. Calif. MCI Nike Identity contacts are important because they can set a tone for subsequent contacts with the company and the brand. has led the way in sponsoring events that their younger customers care about. "They say 'We are a different kind of car company. Sponsorships of everything from local baseball teams to non-mainstream musical events have been sought by marketers looking to carry their brands into the customer's backyard. they see people in matching polo shirts rather than suits. and the showroom itself is clean and friendly." The result. reminder of savings positioned." Saturn said.
in-line skaters." 68 . while they may not have the budget to get involved with paying the gas and living expenses of sending two employees on a cross-country jaunt to spread the word about their brand. BMX biking and snow boarding categories. can easily sponsor community events." writes Upshaw. the tour has also featured the Mega-Pump Climbing Wall Competition and Spike and Mike's Festival of Animation. rock climbers and BMX bikers." Smaller companies. and how can I get involved in those things?" D. "When your company is lucky enough to be the beneficiary of word of mouth. "If you have a retail business in a neighborhood. The business also sets up makeshift service shops off area bike paths on sunny summer days. East Providence Cycle. and your capacity problems may just be beginning." says Kosgrove.with alternative sports by hosting events in the skateboarding. Last summer's roving tour featured punk and "ska" bands as well as pro demos from skateboarders. tune-up students' bicycles on a local college campus to get them ready for the back-and-forth trips from the dorms to classes. Ask yourself: What do my customers care about. "You want to look at what your customers care about. you may want to focus on a charitable or community organization in your neighborhood and make a commitment to it so people understand that you are committed to the community. events where shoes are a prerequisite. for instance. R. your identity problems may be over. the company has done well stepping into other areas of their customers' lifestyles.. In past years. Besides just sporting events. a bike shop in East Providence.I. Vans sponsors the very popular alternative Warped Tour. word of mouth is well worth the effort it takes to generate it. Word of Mouth Whether it is planned or not. The juice company sponsors two Winnebagos to roam the countryside and entice consumers to become "juice guys. an alternative music festival that combines other types of cutting-edge live entertainment. Nantucket Nectars has also garnered fame by using grassroots promotion strategies. "Word of mouth is still considered the most potent marketing communication of all because it's dispensed by the most credible sources of all — ordinary citizens who don't carry a built-in bias of commercial sponsors.
going out to ask people who wrote to the company if their passion for Snapple was really true. the company needs to convert the brand into something that will sustain the hype. The company capitalized on that by highlighting the word of mouth phenomena in its television ads. Ed Koch.7 million. be it the product or the promotional vehicle. after Snapple's success. People are going to tell other people. Creating an Online Identity 69 . Sergeant Dave Hack." he says. and you end up with something that is very positive. Instead." For Web-based brands. and Tickle Me Elmo. nearly every beverage company came out with their own line of iced tea — each one with a different gimmick. "We are selling something with quality and value.Some of the better known beneficiaries of word of mouth phenomena: Furby. the company has been able to generate positive promotion on the Web. It also doesn't hurt to have something extremely unique. the ex-Mayor of New York City. has never posted an advertisement online. be it sun-brewed. In one memorable ad. visits a young fan from the Midwest to ask if he really believes that" Snapple is the only good thing to have come out of New York. the company has relied on word of mouth to promote its brand and Web site during its four-year history. One word of caution: Brands that are propelled by word of mouth often run out of steam quickly since most tend to be just fads or trends. Snapple also hit it big when kids started passing the word about the delicious iced tea beverage. Competitors are also quick to duplicate the product or service being hyped. or some other herbal concoction. it can be done if you have the right product and the right strategy. For instance. says that by staying true to its mission. The founder. the company's earnings slid. the toy sensation of Christmas '98 that sent parents into shopping frenzies. "It snowballs. word of mouth can work extremely well. After the onslaught of the copycat brands. ginsengfortified. the company US Wings. which sells genuine military jackets and gear." While it is difficult to intentionally generate a positive word of mouth branding strategy. the hot toy in 1997. For instance. spring-filtered. Snapple was smart to sell its brand to the Quaker Company in 1994 for $1. Once strong word of mouth is achieved.
com .30 percent Computer Hardware: Dell . Yahoo!. "Typical advertising media hit only a segmented or regional strategy.Online companies are putting branding to work with remarkable success. But it is always important to look toward the future. which offer tangible returns? Although people are shopping online.56 percent Music: CDNOW . "The Internet helps promote companies' products in a very efficient manner and especially to all audiences in all parts of the world. a debate rages in the business departments of many Internet companies over the importance of branding. building up an online brand? Wouldn't those resources be better spent promoting e-commerce efforts. you have a clean slate. 70 .000 Internet users associated the following Net names with the following products: • • • • • • • Books: Amazon. adults.20 percent Clothing: The Gap . How much effort should they spend on e-branding initiatives — that is. and there are mistakes that have been made in the past. Travelocity .24 percent Computer Software: Microsoft ." says Dettore.S. "Any long established brand has had bad experiences. so the Internet is one of the most cost effective ways to brand. According to Intelliquest. "Whereas if you are fresh and new. Companies that form strong associations between their name and their category now will be the ones who will capture future sales.12 percent Travel: AOL. According to a survey from Intelliquest." Research shows the brand names of seven Internet companies are already recognized by more than 50 million U. there are four times as many online shoppers as purchasers. 10." he says. giving them' mega-brand' status. only a percentage of them are actually buying online.8 percent each Autos: Yahoo! .6 percent Kosgrove says that companies that want to build their brand online may actually have an advantage over brands in the physical world since there is the opportunity to start freehand has new associations." Still.
The main benefit is that they are going to be fast. "Sites need to be branded so that the consumer can have confidence in the site and is willing to make a purchase there. an online marketing firm says. Once the information is entered into the database. a company can brand itself as more than just a dog food supplier. "Then it isn't just a bag of dog food. Online. answers are compressed. but rather as an animal nutrition expert. we got it and we will get it to you quick. Really. "What pet store owner is going to carry that message for the ped information telling you which formula of food your pet should be consuming is spit out. There is no way that a pet food company would be able to gain that brand identity in the real world. and information telling you which formula of food your pet should be consuming is spit out." Some tactics to build an online brand include: 1. but nutritional care for your animal. Selection and speed -. friendly environment that Borders can." The company can't offer the warm. says Lynch. however." says Lynch. "Their brand is: you want it. a pet food brand on the store shelf does not have many choices about the positioning of its product. That tactic is certainly true with large online stores such as Amazon. The Web allows companies to take on new edge or benefit that a company would not be able to use in the real world. selection and delivery are their brand." says Lynch. "Then it isn't just a bag of dog food.Online brands don't usually tout themselves as cheap. says Kosgrove. and they will have a large selection. Customization -. from Synnetry.In short. For instance.Another way that brands can differentiate themselves is by providing online customized solutions and products for visitors based on information that they plug into registration forms. 2. Prices are not as important." says Kosgrove. "The World's Largest Bookstore. John Lynch. 71 . service is not as important [at the moment]. but nutritional care for your animal. e-branding is very important and must be taken into consideration. The site can walk visitors through a personalized analysis based on the animal's needs and activity level. but they can promise to ship you the book of your choice practically overnight. data is cross referenced.
If your brand can stimulate a community around it. or join mailing lists or user groups 72 . Customers. "Through the Internet. For instance. chat group. the Web is the perfect place to do just that. Using Interactivity -.Creating services that other Web companies don't have will ensure that your brand is stronger than the rest. which leads to many opportunities for community interaction.There is no way that a pet food company would be able to gain that brand identity in the real world. auction. you need to have a category that will engage people and spur them to want to talk with one another.Community is the other buzz online. then it has a powerful ally. Some other points to keep in mind when building an online community include: Members must share common interests and get satisfaction from connecting with others Members should be able to participate in something such as a forum. "What pet store owner is going to carry that message for the pet food manufacturer to the pet food buyer?" asks Lynch. Unlike other media. prospects and critics of the brand have strong opinions about what they like and don't like. people seem to never tire about the wonders of the Apple computer. For a community to be successful. The company's brand is the focus of debates and discourses in the computer world. Ways to increase contact and keep your brand in front of people include creating: • • • • • Newsletters Targeted emails Message boards Chat Advice columns 4. Luckily. Build a community -. they are allowed to create a better position for themselves than they could if they were going through regular distribution channels." 3. online customers can interact with the brand and its identity in a way that no other medium can offer.
chances are that you are also giving business to UPS or Federal Express. Both shipping companies invite companies to use their software to calculate shipping weights and secure deliveries to the purchaser's home. Williams says that when shopping for strategic partners. they are going to feel good about being on your site.com will also send a heads-up to subscribers telling them about movie promotions that Big Star is running exclusively for Women. Anyone who buys a shirt is going to want to buy a tie." Another way that E-retailers can create partnerships is by finding larger content sites to sell their wares. For instance. Big Star looks for companies that have an active relationship with their members and are willing to get Big Star involved. 5. each time you purchase a package from an e-retailer.com is one site that fit the bill. "If your site sells ties.Like co-branding. and we are often a featured vendor there." says Kosgrove. 73 . Women. Encourage early and steady contributors." says Lynch. it would be good to form a relationship with a store that sells shirts. We also have fitness videos in their health and wellness area and children's videos in their family areas. "We advertise in their entertainment areas.com members. Good alliances on the Web allow traffic to flow between sites that have a common interest. Give members something to care about by establishing a clear economic or social benefit. strategic partnerships between Web brands can help strengthen identity. says Williams. "If someone comes to your site and sees you link with other people that they respect. Women. One of the best ways that an e-commerce site can partner with other sites is to embed themselves within another company's site. enhance visibility and increase revenues for companies." Besides that. "Synergistic sites can swap banner ads usually without any fee being paid. One way that synergistic sites can partner is by swapping banner ads. Federal Express also allows catalog companies like Lands End to move Federal Express data to their own Web sites so that Lands End customers can track their packages' progress. personalize user experience through interactivity with other members and develop opportunities for common leadership/ownership. Form Strategic Alliances -. It's important to find partners who are going to help promote our site.
people are going to say. but actually Dell has lent Joe software so customers can customize their PC. the standard for customer support must be higher for the Web than it is in the off-line world. If your customer service skills aren't up to par. 6. market watcher Jupiter Communications found that 42 percent of the top-ranked Web sites either took longer than five days to reply to customer email inquiries. So be sure you do your homework about what goes into a strong Web site. Dedication to Service ." says Kosgrove.Dell Computer Corp. "If your other communications look warm and friendly and you brand yourself as serviceoriented. never replied. "The best sites in the world. or were not accessible by email." says Lynch. 74 . it's likely that a customer won't come back to interact with your brand or your site. but your Web sight is impossible to navigate and doesn't have an email response or is just kind of clunky. 'I thought you were someone else but now I know who you really are'. partners with smaller computer dealers online to let customers configure their own computers.Online customers have little opportunity to see your brand's dedication to service. however. Building credibility -. It may look as if you are on Joe's Computer Shack Web site. Some of the basics that your Web site should have include: • • • • • Personal Domain Name Contact Information Simple site design and navigation Easy to identify prices. "You are not spending all the promotion money. Despite that logic. in terms of traffic and selling. This is of the utmost importance when you are building a new brand or bringing a new brand to the online arena. if applicable Quick server response 7.Since competition is only a few clicks away. The most essential aspect of customer support on Web sites is to respond to every request for information with accurate answers or corrective actions within competitive time frames. are the ones that you don't even know that you are going to. and you are multiplying your promotional money by many times because you have other people who are trying to get people to go to their site who in turn are at your site.
support staff or other communication tools that will help strengthen the relationship between your brand and customer. While email is the primary communication tool. end-all of customer service. This leads to internal and external research. A process of buying starts in the minds of the consumer." One way to solve the email deluge is to take advantage of "auto-acknowledge" software that responds to all incoming requests stating that the question was received and estimates a time frame for how long it will take to respond to the question. and not responding perpetuates the consumer notion that using the Web site is not a reliable method of doing business with that company. 3. "Answering thousands of questions per month is an enormous challenge for sites offering complex products and services. Yet companies that delay responses to user questions instantly lose a significant degree of credibility and user loyalty. extensive consumer research studies are being conducted. the process starts much before the goods have been acquired or bought. These researches try to find out: 75 ." says Ken Allard."This effort illustrates that many Web sites have been unable or unprepared to respond to the flood of user questions that come in via email from their sites. especially if they never had a traditional call center. This definition clearly brings out that it is not just the buying of goods/services that receives attention in consumer behaviour but. group director of Jupiter's Site Operation Strategies. evaluating. because it gives a clue to the marketers whether his product has been a success or not.4 Consumer Decision Process Consumer behaviour can be defined as the decision-making process and physical activity involved in acquiring. Then follows a process of decision-making for purchase and using the goods. which leads to the finding of alternatives between products that can be acquired with their relative advantages and disadvantages. Companies that want to attach a sense of dedication to their brand should think about having a call center. To understand the likes and dislikes of the consumer. and then the post purchase behaviour which is also very important. it is not the be-all. using and disposing of goods and services.
the involvement of the buyer and the risk that is involved in deciding the product/service. Fig. reference groups. subculture. multidimensional process. values. The consumer and his life style are influenced by a number of factors shown all around the consumer. A simplified framework for studying consumer behaviour The process of decision-making varies with the value of the product. What the consumer thinks of the company’s products and those of its competitors? How can the product be improved in their opinion? How the customers use the product? What is the customer’s attitude towards the product and its advertising? What is the role of the customer in his family? Consumer behaviour is a complex. social status. and all marketing decisions are based on assumptions about consumer behaviour. 76 . These are culture. dynamic. demographic factors. The figures show the consumer life style in the centre of the circle.
The constant use of the product leads to the satisfaction or dissatisfaction of the consumer. This leads to the evaluation of alternatives and a cost benefit-analysis is made to decide which product and brand image will be suitable. First of all. Position the product according to the customers likes and dislikes. All these factors lead to the formation of attitudes and needs of the consumer. perception and learning. This may be the problem of creating a cool atmosphere in your home. by a water-cooler. personality. the decision is made to solve a problem of any kind. to find how the cool atmosphere can be provided.household and also the internal make up of the consumer. is important for repeat purchase. It is more profitable to retain existing customers. Thereafter the purchase is made and the product is used by the consumer.g. after the sales have been affected. information search is carried out. which leads to repeat purchases. For this. the marketer must lay emphasis on the product/brand image in the consumer’s mind. rather than looking for new ones. Sales are important and sales are likely to occur if the initial consumer analysis was correct and matches the consumer decision process. The brand which matches the desired image of a target market sells well. motives of buying. Consumer is also influenced by the marketing activities and efforts of the marketer. e. The decision-making process consists of a series of steps which the consumer undergoes. and can take care of the problem suitably and adequately. The marketing strategy is successful if consumers can see a need which a company’s product can solve and. offers the best solution to the problem. by an air-conditioner or. Satisfaction of the consumer. For a successful strategy. The figure below gives an idea of the above discussion. or to the rejection of the product. which are consumer’s emotions. 77 .
Creating Satisfied Customers 78 .Fig. Decision Process Fig.
CHAPTER-4 Research Report TITLE: 79 .
Research methodology not only talks of the methods but also logic behind the methods used in the context of a research study and it explains why a particular method has been used in the preference of the other methods. TITLE JUSTIFICATION: The study mainly deals with studying the response of Indian market towards the introduction of LCD TVs. To analyze the factors influencing the customers to choose a particular brand of LCD TV. RESEARCH METHODOLOGY: Research methodology is considered as the nerve of the project. The Research is Exploratory Research. SAMPLE SIZE: 80 . In the present Research data has been collected from 50 dealers. The project was based on the survey plan. OBJECTIVES OF THE PROJECT: • • • • To analyze the LCD TV Market of North Delhi. To formulate the marketing strategy for increasing the sales of LCD TV in the market. Without a proper wellorganized research plan. The project also deals with the future prospects of LCD TVs in India. On the basis of the study we can formulate the marketing strategy that can be implemented to increase the demand and sales of LCD TVs in the market. Therefore. which work as a base for drawing conclusion and getting result.To study the “Advent of LCD TVs and their future prospects in India”. research methodology is the way to systematically solve the research problem. The main objective of survey was to collect appropriate data. To know the customers view towards LCD TV of different brands. it is impossible to complete the project and reach to any conclusion.
SAMPLING METHOD: Percentage Method. SAMPLING PROCEDURE: Open and Close Ended Questionnaire are used. SAMPLING TECHNIQUE: Convenient Sampling Method.50 dealers. The dealers may be biased. SOURCE OF INFORMATION: Primary Data is used. METHOD OF DATA COLLECTION: Questionnaire Method has been used. 81 . LIMITATIONS OF STUDY • • • • The respondents were limited and cannot be treated as the whole population. The accuracy of indications given by the respondents may not be consider adequate. Time was the major constraint.
Market Share of different Brands of LCD TVs in North Delhi: 82 .CHAPTER-5 Data Analysis and Interpretation On the basis of the survey conducted in North Delhi on LCD TV the following analysis and interpretation has been obtained: 1.
2. Market Share of Different Brands of Colour Televisions in North Delhi: Brand Samsung LG Share 46% 28% 83 .Brand Samsung LG Sony Sansui Panasonic Videocon Haier Philips Share 36% 20% 16% 6% 6% 10% 2% 4% Interpretation: Samsung is having the maximum market share in North Delhi in case of LCD TVs.
Percentage Share of Different sizes of LCD TVs in the market: Size 19/20 inches Percentage 31.30% 40/42 inches 5. 3.Sony Sansui Panasonic Videocon Markson Philips 4% 2% 2% 12% 2% 4% Interpretation: Samsung has the highest market share in North Delhi in case of CRT TVs.50% 84 .20% Share of Different size of LCD TV 26 inches 33% 32 inches 30.
Various Criteria for choosing a particular Brand of LCD TV by the customer: Criteria for choosing a particular Brand of LCD Number of Dealers 85 .Interpretation: 26 inches LCD TV is most sold in North Delhi with around 33% of the total customers buying this size of LCD TV. 4.
TV Brand Loyalty Price Mixed Criteria Product Innovation 20 11 18 01 Interpretation: This chart shows that the Indian Customers are Brand Concious. Factors governing the demand of LCD TVs in the market: Factors governing the demand of LCD Percentage TVs Price Reduction 62% Awareness Campaigns 28% 86 . 20 of the total dealers feel that customers buy a product keeping in mind some particular brand. 5.
6.40% 49.80% 24.80% 87 .Advertising Technical Advantages 8% 2% Interpretation: A major portion feel that price reduction will help companies to increase there sales of LCD TVs in the market. Share of different customers according to the income group they belong to: Income Group Share Percentage Lower Income Middle Income Upper Income Group Group Group 25.
8. Most common size purchased by Upper Income Group = 32 inches. 23274 88 . 14042 22 inches Rs.Interpretation: The middle income group is the major buyer of LCD TVs in North Delhi. The price comparison of various Brands of LCD TVs available in the market is as follows: Brand Samsung 19 inches 20 inches Rs. Most common size purchased by Lower Income Group = 20 inches. 7. Most common size purchased by Middle Income Group = 26 inches. 15362 26 inches Rs.
33131 Rs. 24700 40 inches Rs. 57617 Rs. 13910 Rs. 17800 Rs. 14200 Rs. 22000 Rs. 20500 Rs. 33600 Rs. 29500 Rs. 33712 Rs. 27450 Rs. 14200 32 inches Rs. 28320 Rs. 22529 Rs. 15120 Rs.LG Sony Haier Panasonic Sansui Philips Toshiba Onida Videocon Hyundai Markson Brand Samsung LG Sony Haier Panasonic Sansui Philips Toshiba Onida Videocon Hyundai Markson Rs. 19700 42 inches Rs. 53800 Rs. 14943 Rs. 54300 Rs. 13016 Rs. 36460 Rs. 60426 Rs. 55785 Rs. 22600 Rs. 30562 Rs. 12063 Rs. 34500 Rs. 54990 89 . 9990 Rs. 29779 Rs. 12990 Rs. 23542 Rs. 28233 Rs. 29930 Rs. 60100 Rs 13900 Rs. 22340 Rs.
Only two companies are manufacturing 22 inches LCD TVs and LG’s LCD TV is cheaper in comparison with Samsung’s LCD TV. Except Haier all other Brands have almost equal price for a 20 inch LCD TV. 91 .Interpretation: Hyundai LCD TV is having the least price in the 19 inches range.
Interpretation: The price range offered by Markson is least in case of a 26 inches LCD TV. 92 .
Interpretation: Markson LCD TV is the cheapest in comparison with other LCD TV brands in 32 inches segment. 93 .
Interpretation: Videocon is offering its 40 inches LCD TV at the least rate in comparison with others.
Interpretation: Markson’s LCD TV is very cheap in comparison with LG in 42 inches LCD TV segment.
9. Various advantages because of which customers choose LCD TV over CRT TV: Main Advantage of LCD TV Image Clarity Multi functionality Easy to handle Share 88% 8% 4%
Interpretation: Image Clarity is major advantage which people consider while buying a LCD TV.
10. The features available in various brands of LCD TV( size=32 inches) are as follows: Features Full HD/HD ready HDMI Motion Flow Colour Picture Processing USB Playback Contrast Ratio Response Time Power Consumption Audio Output Brightness FM Radio Bluetooth Connectivity Hard Drive Features Full HD/HD ready HDMI Motion Flow Colour Picture Processing USB Playback Contrast Ratio Response Time Power Consumption Audio Output Brightness FM Radio Bluetooth Connectivity Hard Drive Samsung Both models available 4 HDMI 100 Hz Wide Colour Enhancer 10-bit Yes(JPEG only) 50,000:1 to 1,00,000:1 2.4 ms to 4 ms 150- 180W 24-30W(RMS) 500cd/m2 Yes No No Onida HD ready 2 HDMI ---No 30,000:1 8 ms 180W 400W(PMPO) 500cd/m2 No No No LG Both models available 2 HDMI 100 Hz 1.3 Deep Colour 10-bit Yes(DivX only) 60,000:1 to 80,000:1 4 to 5 ms 125-150W 24W(RMS) 500cd/m2 No Yes No Videocon Both Models available 2 HDMI -16.7 million display colours -No 30,000:1 to 50,000:1 5 ms 160W 20W(RMS) 480cd/m2 No No Yes Sony Both models available 4 HDMI 100 Hz Live Colour 10-bit Yes(some models) 20,000:1(stopped displaying) 4 ms 115-145W 20W(RMS) 500cd/m2 Yes No No Sansui HD ready 2 HDMI -16.7 million display colours -No 30,000:1 6.5 ms 160W 20W(RMS) 500cd/m2 No No No
5 ms 130W 30W(RMS) 500cd/m2 No No No Markson HD ready 1 HDMI --8-bit Yes 10.8 Billion Colours 8-bit No 33.000:1 6.500:1 8ms 140W 20W(RMS) 500cd/m2 No No No Philips HD ready 2 HDMI 100 Hz 29.000:1 8.000:1 8 ms 160W 20W(RMS) 450cd/m2 No No No Toshiba HD ready 2 HDMI 100 Hz Real Colour Algorithm 10-bit No 4.000:1 16 ms 150W 30W(RMS) 500cd/m2 No No No Haier HD ready 3 HDMI ---Yes 15. 97 .5 ms 160W 20W(RMS) 450cd/m2 No No No The comparison suggests that Markson needs to enhance its features to beat the competitors in the market.Features Full HD/HD ready HDMI Motion Flow Colour Picture Processing USB Playback Contrast Ratio Response Time Power Consumption Audio Output Brightness FM Radio Bluetooth Connectivity Hard Drive Features Full HD/HD ready HDMI Motion Flow Colour Picture Processing USB Playback Contrast Ratio Response Time Power Consumption Audio Output Brightness FM Radio Bluetooth Connectivity Hard Drive Interpretation: Panasonic HD ready 2 HDMI 100 Hz --SD card slot 10.
CHAPTER-6 Observations and Findings 98 .
response time and power consumption are the primary specifications about which the customers ask for. FM radio. Samsung is offering very good features at a very reasonable rate rite now. Price reduction and awareness campaigns can help a company to increase the demand of LCD TVs in the market. Keeping there room size in mind. Samsung has made a good name in case of sales of CRT TVs as well. Image clarity is the major reason why people go for LCD TV instead of a CRT TV. Bluetooth connectivity and hard drive are the secondary features which the customers want to have in the LCD TV.Observations and Findings • • • • • • • • • • • • The market share of different LCD TVs indicate that Samsung is emerging as a great Brand in the Indian market. HDMI ports. contrast ratio. 99 . Brand Loyalty plays a vital role among Indian customers while buying the LCD TV. Markson is offering its LCD TVs at a very cheap rate in comparison with all other brands available in the market. 26 inch LCD TV is most preferred by the Indian customers. Around 50% of the total sale of LCD TV is because of the middle income group and they usually purchase a 26 inches LCD TV. USB playback. The competition is only between LG and Samsung for a 22 inches LCD TV.
CHAPTER-7 Conclusion and Strategy 100 .
Increase the contrast ratio to about 35. Bluetooth. 3. In classroom lectures. The following points need to be considered while deciding on the distribution network: 1.7. The proper selection of the marketing mix. 101 . Response time needs to be decreased to 4-6 ms. Special additions on profits earned by distributors can be provided by the company to increase the sales of LCD TVs. And a proper marketing strategy can help a company to take the maximum advantage of this emerging trend. 7. 4. 2. The distributors need to be trained on how to market our LCD TVs. I was able to understand only the theoretical work but now I have the practical experience about the marketing activities. We need to have more distributors in North Delhi for LCD TVs.2 Proposed Marketing Strategy The following changes in the product features can help Markson to improve its LCD TV sale in the market. Launch 32 inches and 42 inches LCD TV with high resolution and Full HD specification. 2.000:1. Picture processing needs to be increased to 10-bit processing. The prospects of LCD TV market are quite bright in the near future. Motion Flow and colour gamut specifications need to be displayed. 3. 7. Our old distributors do not have Markson LCD TV in their show rooms to sell. 1.1 Conclusion This project helped me tremendously in knowing how marketing activities are carried out in a real situation. 6. FM radio and inbuilt Hard Drive option can also be added. Increase its HDMI interface ports to two or three in number. 5. Branding strategy and study of Consumer Behaviour can take a company to the new heights.
Almost 50% of LCD TVs are purchased by customers belonging to middle income group and 26 inches LCD TV is commonly bought by them and 25% of LCD TVs are bought by lower income group of 19/20 inches in size. 3. No need to have actor/actress as a brand ambassador. Try to sponsor events such as annual functions of the companies and large gatherings. 102 . 4. all of us know that advertising plays a vital role in creating awareness among the customers about the product. Use fundamental colours like Black. So I think that following points should be considered for advertising LCD TVs: 1. Place the company ad banners at various metro stations and also in the metros as well. So. As I surveyed through the market I found out that all dealers are expecting that prices of LCD TVs will continue to crash till Diwali so I think that we should reduce the prices of LCD TVs so as to remain competitive. So. 5. A combo offer or a discount offer for old colour TV can be of great help to increase the sale of LCD TV. I think that a 22 inches LCD TV can cater for both the income groups well. These types of colours hit the customers psychologically. I suggest that the company should launch a 22 inches LCD TV in market.4. Select one or two models for these ad banners and pamphlets so as to target Young India. 2. Now coming down to promoting. Red and Blue while preparing the pamphlets and brochure. Financial Schemes on LCD TVs can also help us to increase the sale of LCD TV as we do not have to reduce our profits and less cash flow will be needed by the customer.
It can be done in the following way: 1. The two suggested Logos by me are as follows: Observe carefully: The person is enjoying the music. Brand Logo: I think that we need to change our Brand Logo from British Flag to something else. I also analyzed that Brand Loyalty is the main criteria among customers for choosing a particular brand of LCD TV. I think that it is very difficult for Indian minds to adopt any product which is associated with British People. So it is very important to develop the Brand Image in the market. 103 .
C) Bringing colours of life together. It gives a signal of good infrastructure of the company. It should be such that the customer feels that he is a part of the process. so choose a brand ambassador who represents the Image of Young India. A Free Toll number also gives an indication of the brand. Two such slogans which can help the company are as follows: A) Selling satisfaction not products. 4.Metallic M represents that our effect is everlasting. This age group holds the maximum buying capacity. I think that if we will adopt this kind of marketing strategy for LCD TVs then we will definitely be able to capture a significant part of Market Share in the near future. 2. Brand Personality: We should select a brand personality as such which hits the minds of the Young India (25-40 years of age group). Brand Slogan: Brand Slogan tells that what the company is aiming for. B) Making life pleasant and enjoyable. 104 . 3.
CHAPTER-8 BIBLOGRAPHY 105 .
emsnow.scribd.com www.in 106 .en.indianmba. http://www.cfm?id=27593 www.References: Marketing Management by Philip Kotler.markson.rncos.kioskea.pdf www.cci.htm www.in/pdf/surveys_reports/consumer-durables-sector.com www.com/npps/story.com www.com/Report/CP13_toc.wikipedia.net http://www.
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