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Monday, June 7, 1999

Project White Goods -- Samsung gets ready for post-World Cup market 

Mukta Magazine  
New Delhi, June 6: With the World Cup '99 frenzy peaking, Samsung India Electronics Ltd is setting into place the next phase of its market strategy. On the anvil: a shift away from touting primarily televisions, to pushing the white goods launched in the last two months. Says Ravinder Zutshi, vice-president, sales, ``Having stabilized our position in CTVs--we sold 60,000 sets in May itself--our clear business strategy for CY '99 is to focus on white goods. We ae targeting a 35 per cent contribution (Rs 315 crore) to the overall targeted turnover of Rs 900 crore from the white goods segment.''

Consumer pull for the `Crystalwash' semi-automatic washing machines--launched in mid-May--will be stepped up with a television and print ad campaign, made by Mudra, by June-end (the monsoons are considered the best selling season for washing machines.) Endorsed by its brand ambassador Kapil Dev, the commercial will highlight the cleaning efficiency derived from the `Boomerang' pulsator of the machine. Samsung alsoplans to launch models in the 6 and 8 kg segment--categories which the company feels generate volumes--by year-end.

Promotional activities for its microwave ovens will also be stepped up in July-August '99, with the launch of three new models and the very first commercial for the new product category. Says Zutshi: ``We see microwaves as a growing market with great potential. The product is moving very well and there is a growing demand for the grill model.'' In order to increase awareness about microwave cooking, Samsung is planning special offers, besides bundling the `Samsung Book of Indian Microwave Cooking' free alongwith the product.

Since April 1999, Samsung has set into motion the process of widening its base by entering new segments and focusing on its portfolio of white goods.

In mid-May it launched the `Crystalwash' 5.5 kg semi-automatic washing machine, while in April it expanded its range of direct cool refrigerators by introducing two new models in 190 lts and 230 lts under the `Ice World'sub-brand. These launches are also in keeping with its strategy of spreading Samsung's reach beyond the premium end to the mass market, where the volumes lie.

Beside strengthening its range of direct cool refrigerators, in April it introduced a new range of Frost Free refrigerators, sub-branded `Cool Tech Dynamic' which incorporate features like larger refrigerator space. Says Zutshi, ``This is a major project for us. What is new about this range is that, in keeping with Indian needs, the freezer space (earlier 33 per cent) has been reduced by five per cent, so the proportion of space in this range is now 72:28.'' This was done following feedback from dealers and sales teams.

The second half of the year will see a lot of advertising and promotional activity for these products. The company has increased its ad budget from Rs 35 crore last year to Rs 60 crore this year. This includes its Rs 7 million World Cup budget. Already it has spent Rs 26 crore between April-June '99. It also claims to have gotconsiderable mileage from its World Cup Sure Shot campaign that has been extended to the entire product range.

In the AC segment also it has enhanced its range with two new models, with additional features. This takes the total models on offer from Samsung, to nine.

Having made a foray into the mass segment, it is also making efforts to increase visibility and reach in the smaller markets, by moving beyond the metros to smaller cities like Bhubaneswar and Patna. Plans are afoot to increase the dealer network from 1,600 to 2,000.

Over a period of time, depending on the demand and requirements of the new segments, at least five more exclusive brand shops will be added to the present 10--including smaller towns like Agra and Jaipur. On-going training programmes for dealers and sales personnel are also being updated to educate them on the new products and make their marketing more focussed.

With these moves in place, Samsung hopes to achieve its target for calender year 99: ensuring that white goodscontribute to 35 per cent of its overall targeted turnover of Rs 900 crore. Last year white goods accounted for 20 per cent of the company's turnover of Rs 540 crore. Its targeted market share in the different white goods categories for this year are: washing machines: 10 per cent; ACs: seven per cent; refrigerators: 35 per cent in the frost free segment, and five per cent in the direct cool segment; and microwaves: 23 per cent.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.


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