Philips rolls out mass market radio targeted at rural segment

Updated: Jan 24 2002, 05:30am hrs
In a bid to trigger brand penetration in the rural markets for the audio segment, the Rs 1666 crore Philips India is in the process of making a full fledged roll out of a new range of battery free, radio across the nation. It runs on a smal, dynamo that has to charged by winding a key.

This arrives as a strategic imperative for the audio video major, to unveil free power and battery less radios in the Indian market priced at Rs 995, According to Philips India senior vice president (consumer electronics), Mr Rajeev Karwal: “ Philips battery-less radio will enable consumers to save Rs 1200 a year, which he would otherwise have spent on batteries.”

The company has recently launched the new radio at all its distributors meet at Jaipur and will continue to showcase the product in all other launches during the year. The objective of the launch through the trade, the company believes is to convince its distributors that the company has a winner in its hand and focus on the power-free radio.

Explains Mr Karwal: “Philips as a market leader in audio segment needs to drive the business and pioneer new concepts to grow the business and also for consumers to see the innovation and authority in the brand as far as audio products are concerned. With the burst of FM radio stations, we believe the usage of radio in a day is bound to increase. In a product like this with no recurring cost on batteries, consumers are bound to see value and novelty.”

According to Mr.Rupam Ganguly, general manager, trade and consumer services, the company will also be launching a new campaign targeted at both the semi urban and rural consumers with the catch line‘chavi gumao, radio bajao’, in select states by mid-Feb 2002. The key message at to launch stage would be world’s first battery free radio.

As a direct consumer communication initiative, the company therefore is expected to also unravel certain on-ground promotional initiatives.

Says Mr Karwal: “In smaller markets given the erratic electric supply and the cost of batteries, we feel that there is an inherent need and benefit which this product delivers and hence makes their lives better. And the value conscious Indian middle class will definitely see the advantages of this product.

As regards the pricing strategies, says Mr Karwal: “Also from a price angle, consumers felt that the product should be available at sub 1,000 price and further go down over a period of time. Hence we decided to price it at Rs 995.”

According to Mr.Suresh Sukumaran, senior general manager, marketing, there is still 55 per cent of rural household who can be the potential audience for radio. This is the core consumer base the company would pro-actively target with integrated marketing strategies to accelerate the product mobility.

Says Mr.Sukumaran:” This is a mass market brand with a primary focus on the rural audience. Concessional pricing will therefore become the lead strategy for consolidating a brand presence in the rural market”.

Philips India will manufacture and market one lakh units of its free power radios per annum. Currently, Philips India sells over one lakh units of FM radios per month.

Comments Mr Karwal: “ Currently Philips sales tunover is around Rs 45 crore in radios and we want to move to Rs 60 crore by 2003-end.”

In radios, Philips India says it has a value market share of 58.3 per cent in November 2001, and have grown at 13.6 per cent over November 2000. However, in the radio segment, Philips competitors such as BPL, Videocon made an entry but has lost interest in the segment as volumes is the key here.