PIL's fresh strategy for the audio systems segment is a mix of strengthening its audio systems product offering, leveraging its revamped distribution network and aggressive marketing and advertising, says the company. Where the total audio market exhibited a decline of 8.3 per cent in 1999 over 1998, the audio systems market - comprising of products priced in the 11,000 plus price bracket-has grown at a rate of 13 per cent. With the share of the audio systems market as a per cent of the total market leapfrogging from 25 per cent in 1998 to 38 per cent 1999, the segment is expected to thrive even as volumes in the lower-end, portable audio systems remain large at nine million units. What's more, it is here that PIL isfacing maximum heat from the likes of Sony and Aiwa. Last year, Aiwa had managed to overthrow PIL from its leadership position. The Baron Electronics promoted brand currently dominates the market with a 40 per cent market share.

The company will bolster its product offering in the CD mini segment- which at 90 per cent is the largest segment of the market currently. ``We intend to drive the market towards CD Products and achieve a dominant position therein,'' says PIL vice-president, consumer electronics, Rajeev Karwal.As part of an effort to enhance the company image, PIL intends to launch close to nine new products across all segments in the top end audio market this year. These include a DVD mini model to be launched in September this year and a CDR mini model which will hit the market in a months time.

Recently, the company launched its CDR-870, a CD recorder for the first time in the Indian market. Priced at Rs 39,900 the product is a HiFi component which connects to the existing audio sources and allows users to record a CD with the press of a button. The company will introduce the same in the more mass market CD-mini segment in a months time. Says Karwal: ``The idea is to make what is now a niche product accessible to the mass market. We are hoping to sell close to 1,000 units of the CDR minis.''

Priced at Rs 40,000 the mini CD recorder like the other products in the audio systems segment will be distributed through a direct distribution channel comprising 2,100 dealers. The thrust of the distribution strategy for the premium products will be on increasing market reach and counter share. For the audio systems, much of the action will center in the large towns (with population above five lakh) where the company will increase market reach by healthy 15 per cent in 2000 over last year. The turnover share per counter- Philips products sold as per cent of total sales per counter - is targeted to be 10 per cent higher than last year. The market reach in case of medium sized towns (with population less than 5 lakh) will be enhanced by 10 per cent while the turnover share is maintained at last years level.

In a bid to enhance its turnover share per counter, the company is targeting delivery within 24 hours of the dealer placing orders, increased frequency of dealer visits depending on the size and class of the dealer, back office support by opening branch offices in seven focus states and enhancing retail presence by merchandising and retail management in 1,000 outlets. The audio systems segment will continue to be the focus area. Where the non CD product promotions will be restrained to below the line activities, CD-based products will be sold through aggressive mass media campaign. The company is planning to build its brand image on product uniqueness and technology platform.