Description
PROJECT ON MULTIBRAND STARTEGY OF VIDEOCON
AKAI
SANSUI
MULTI-BRANDING STRATEGY OF VIDEOCON INDUSTRIES IN THE CONSUMER DURABLES SECTOR
Presented by: Bhavika Sawhney Bhoomika Chadha Prateek Arora Tarun Dhingra Trisha Pruthi
?
It is a marketing strategy under which two or more similar products of a firm are marketed under different brand names.
?
Many a times, these products are competing ones and are
marketed under brand names which are completely unrelated.
?
1984:- NV Dhoot with 3 sons:- Venugopal, Rajkumar & Pradeep founded VI
?
Earlier, they started a business of sugar mills and some other low
profile industrial interests in the region of Maharashtra
? ?
Establishment of VI surprised the Industry Watchers . 1987:- Manufacturing and Marketing the Videocon Range of B&W AND Color Televisions, launched washing machines.
?
?
1989:-Home Entertainment Systems and Air Conditioners
1991:- Refrigerators and Coolers.
?
Early 90s :- After the failure of VI to diversify into Real Estate, Crucial decision Was made to manufacture CRT glass shells.
? ?
Set up a world class manufacturing facility at BHARUCH, GUJRAT. 1996:-Entering Energy Sector. Investments into Rava Oil Fields
gave it a regular flow of cash.
? ?
1998:- Bought a TV manufacturing facility of PHILIPS in WB. 1999:- Took the services of McKinsey & Co. to draw the plan for restructuring the company.
?
Company established 8 SBUs headed by independent chief operating officers
?
These were:- MANUFACTURING,AFTER SALES , THE AKAI BRAND, THE SANSUI BRAND % VIDEOCON BRAND
?
Others were Product Specific:- TVs, Refrigerators and Washing Machines
? ?
7TH JULY,05:- Acquisition of ABE in EKL. Focus was on Multi Branding Strategy.
?
?
Agreement with HUNDAI ELECTRONICS LTD .
Licensing Agreement with Toshiba & Sansui
WHY?
? ? ? ?
Was unable to face the immense competition Market Share % Market Growth were the major factors. Large Sales Volume with Cost Effectiveness VI :- Profitable Company & Had resources( man power, Financial,Technical etc ) to sustain a Multi Branding Strategy.
?
Focus was on Long term Goal.
VIDEOCON INDUSTRY?S BRAND PORTFOLIO
• •
Videocon entered the consumer durables sector in mid 1980?s
VI marketed its products under the Videocon brand and was
positioned and perceived as a mid segment brand.
• • •
Competed directly with BPL and Onida. But the entry of LG and Samsung disturbed its market share. To counter attack- VI adopted multi-brand strategy and to boost brand image came up with a high-decibel ad campaign in 2001.
•
Immediate result was increase in sales by 30% but market share declined in 2002.
•
In 1980?s, VI went into an agreement with the Japanese company, Toshiba, to manufacture its range of colour televisions.
•
In 1998, VI launched Toshiba brand projection TV?s. They competed directly with Samsung?s range of projection TV?s.
•
In 2001,in order to increase its focus on marketing Toshiba?s high end products, VI created a a wholly owned subsidiary called Kentosh Electronics India Ltd.(KEIL)
•
•
KEIL was also to market Kenwood branded Hi-Fi audio products.
In 2002, Kenwood and VI parted ways. Till 2005, KEIl sold DVD players, TV?s, flat TV?s, Projection TV?s under the Toshiba brand.
•
In March 1999, VI entered into a join venture with Akai Electric Co. Ltd.(AECL), to form a new a entity called Akai India Ltd., in which VI had 70% share.
•
VI followed a two-pronged strategy for the Akai brand. It continued to sell low price models but made efforts to emphasize quality and technology in the communication.
•
Over the years, Akai was projected as a price warrior. Hence, it became a player in the lower end of the market.
• •
Sansui came into VI?s fold in 1990?s Initially, the products under the brand were priced on the higher side and competed with brands like Philips.
• • •
But gradually, prices were slashed Sansui also launched exchange schemes for its CTV?s The brand heavily depended on promotional offers and discounts. But inspite of the promotions Sansui couldn?t gain a significant market share.
?
?
KAIL launched KENSTAR in 1996.
Introduced with microwave ovens and then followed by coolers, mixers and grinders, toaster, juicers and refrigerators.
?
KENSTAR was positioned as premium segment and entered in to agreements with Yugoslavia and an Algeria based firm to
manufacture and supply KENSTAR branded CTV?s
?
2004-05 LG and SAMSUNG spoiled the party of VIDEOCON and subsequently LG acquired 40% of market share in ovens
?
2004: VIDEOCON(VI) licensed HYUNDAI brand from „HEI? South Korean co for 5% royalty on sales.
?
? ?
2005: VI made HE INDIA a wholly owned subsidiary.
HYUNDAI was positioned at the upper end market. Company had planned to spend heavily for advertising and R&D.
• 2005: VI took over EKL. It brought the Indian rights of
ELECTROLUX for 5 years and 25 years for KELVINATOR. ALLWYN brand also came under the VI fold subsequently.
• 2006: VI announced it will stick its KELVINATOR brand with
Refrigerators and its tagline will also remain same “the coolest one”.
• VI expanded its dealer and showroom network to increase its reach.
?
Prior to liberalization, Indian durables industry was dominated by
Indian brands.
?
By the end of 1990s, the share of Videocon steadily declined.
?
In order to onslaught from the competition, VI adopted the multi branding strategy by acquiring Toshiba, Sansui and Akai.
?
The strategy was meant to fend off attacks on core brand from rivals.
TOSHIBA HYUNDAI ALLWYN KELVINATOR
VIDEOCON
AKAI ELECTROLUX
SANSUI KENSTAR
?
In 2000, VI launched several products under its core brand, Sansui
and Akai and VI was positioned as a Value brand.
?
Positioning and targeting has to be distinct, or else the brands tend to cannibalize each others share.
?
In 1999, VI had market share 10.5% which fell to 7.3% in 2002,
whereas Sansui increased its market share from 4.6% to 6.7%.
?
Having several brands, unless backed by constant upgradation in technology and design would prove to be burden to the company.
?
Inexperience in managing premium brands. For instance, Kenwood
which was a premium brand couldn?t make a dent in the marketing
arrangement.
?
Multi-branding strategy requires deep pockets who can allocate high marketing budgets for each brands.
?
2005 – LG & Samsung lion?s share of T.V. & home appliances market.
?
Philips rejuvenating business in India, Haeir & TCL planning to
establish themselves.
?
Videocon not doing well in all product categories.
Market Shares in Indian Washing Machines Market in 2004
4% 24% 34% LG Whirlpool IFB 13% 11% 14% Samsung Videocon Others
Market Shares in Indian Refrigerators Market in 2005
9% 23%
11%
10% 17%
Videocon Godrej Samsung LG
30%
Whirlpool
Others
?
VI will have to manage its existing brands as well as EKL?s brands.
?
Indian white goods industry very competitive. VI capable of investment in building brand equity.
?
VI should not use price plank for core & premium brands.
?
VI needs to invest in technology.
?
VI may be able to pose a challenge for Korean brands because of its multi-branding strategy.
Q1.
Considering the fact that marketing costs are escalating, how prudent, in your view, is VI?s strategy of having several brands?
?
Good strategy when faced by heavy competition. Protection of core brand. Increases shelf space. Keeping firm?s managers on toes by generating internal competition. Company can fill up price & quality gaps, & saturate the market. Company can serve effectively to brand switchers.
?
?
?
?
?
?
Cannibalization
?
May cause operational confusion.
?
Heavy budgets needed.
?
Videocon a mid-segment brand, inexperienced in handling premium brands (poor management).
Do you think that VI adopted the multibranding strategy because it failed to counter competition with a single brand?
?
Prior to liberalization of the Indian Economy, the Indian Consumer Durables Industry was dominated by Indian Brands like BPL, Onida and Videocon. By the end of 1990?s, Korean brands like LG and Samsung had established a strong foundation in the country by expanding their dealer networks. As a result, VI?s share declined.
?
?
?
In order to onslaught the competition, VI acquired Indian Rights for
brands like Toshiba, Sansui and Akai.
?
Though the share of Videocon fell, the other brands were able to corner market share, thereby giving VI a respectable combined market share.
?
Multi-Branding strategy was akin to warfare. Just as a king is
flanked by several soldiers in a battle, the multi-branding strategy
allowed VI to protect its core brand Videocon.
?
So the strategy was meant to fend off attacks on the core brand from rivals.
With the Korean brands, especially LG, entering rural India in a big way, what in your view are VI?s chance of becoming the No1. consumer durables company in near future? Justify you?re answer
THANK YOU!
doc_664021710.pptx
PROJECT ON MULTIBRAND STARTEGY OF VIDEOCON
AKAI
SANSUI
MULTI-BRANDING STRATEGY OF VIDEOCON INDUSTRIES IN THE CONSUMER DURABLES SECTOR
Presented by: Bhavika Sawhney Bhoomika Chadha Prateek Arora Tarun Dhingra Trisha Pruthi
?
It is a marketing strategy under which two or more similar products of a firm are marketed under different brand names.
?
Many a times, these products are competing ones and are
marketed under brand names which are completely unrelated.
?
1984:- NV Dhoot with 3 sons:- Venugopal, Rajkumar & Pradeep founded VI
?
Earlier, they started a business of sugar mills and some other low
profile industrial interests in the region of Maharashtra
? ?
Establishment of VI surprised the Industry Watchers . 1987:- Manufacturing and Marketing the Videocon Range of B&W AND Color Televisions, launched washing machines.
?
?
1989:-Home Entertainment Systems and Air Conditioners
1991:- Refrigerators and Coolers.
?
Early 90s :- After the failure of VI to diversify into Real Estate, Crucial decision Was made to manufacture CRT glass shells.
? ?
Set up a world class manufacturing facility at BHARUCH, GUJRAT. 1996:-Entering Energy Sector. Investments into Rava Oil Fields
gave it a regular flow of cash.
? ?
1998:- Bought a TV manufacturing facility of PHILIPS in WB. 1999:- Took the services of McKinsey & Co. to draw the plan for restructuring the company.
?
Company established 8 SBUs headed by independent chief operating officers
?
These were:- MANUFACTURING,AFTER SALES , THE AKAI BRAND, THE SANSUI BRAND % VIDEOCON BRAND
?
Others were Product Specific:- TVs, Refrigerators and Washing Machines
? ?
7TH JULY,05:- Acquisition of ABE in EKL. Focus was on Multi Branding Strategy.
?
?
Agreement with HUNDAI ELECTRONICS LTD .
Licensing Agreement with Toshiba & Sansui
WHY?
? ? ? ?
Was unable to face the immense competition Market Share % Market Growth were the major factors. Large Sales Volume with Cost Effectiveness VI :- Profitable Company & Had resources( man power, Financial,Technical etc ) to sustain a Multi Branding Strategy.
?
Focus was on Long term Goal.
VIDEOCON INDUSTRY?S BRAND PORTFOLIO
• •
Videocon entered the consumer durables sector in mid 1980?s
VI marketed its products under the Videocon brand and was
positioned and perceived as a mid segment brand.
• • •
Competed directly with BPL and Onida. But the entry of LG and Samsung disturbed its market share. To counter attack- VI adopted multi-brand strategy and to boost brand image came up with a high-decibel ad campaign in 2001.
•
Immediate result was increase in sales by 30% but market share declined in 2002.
•
In 1980?s, VI went into an agreement with the Japanese company, Toshiba, to manufacture its range of colour televisions.
•
In 1998, VI launched Toshiba brand projection TV?s. They competed directly with Samsung?s range of projection TV?s.
•
In 2001,in order to increase its focus on marketing Toshiba?s high end products, VI created a a wholly owned subsidiary called Kentosh Electronics India Ltd.(KEIL)
•
•
KEIL was also to market Kenwood branded Hi-Fi audio products.
In 2002, Kenwood and VI parted ways. Till 2005, KEIl sold DVD players, TV?s, flat TV?s, Projection TV?s under the Toshiba brand.
•
In March 1999, VI entered into a join venture with Akai Electric Co. Ltd.(AECL), to form a new a entity called Akai India Ltd., in which VI had 70% share.
•
VI followed a two-pronged strategy for the Akai brand. It continued to sell low price models but made efforts to emphasize quality and technology in the communication.
•
Over the years, Akai was projected as a price warrior. Hence, it became a player in the lower end of the market.
• •
Sansui came into VI?s fold in 1990?s Initially, the products under the brand were priced on the higher side and competed with brands like Philips.
• • •
But gradually, prices were slashed Sansui also launched exchange schemes for its CTV?s The brand heavily depended on promotional offers and discounts. But inspite of the promotions Sansui couldn?t gain a significant market share.
?
?
KAIL launched KENSTAR in 1996.
Introduced with microwave ovens and then followed by coolers, mixers and grinders, toaster, juicers and refrigerators.
?
KENSTAR was positioned as premium segment and entered in to agreements with Yugoslavia and an Algeria based firm to
manufacture and supply KENSTAR branded CTV?s
?
2004-05 LG and SAMSUNG spoiled the party of VIDEOCON and subsequently LG acquired 40% of market share in ovens
?
2004: VIDEOCON(VI) licensed HYUNDAI brand from „HEI? South Korean co for 5% royalty on sales.
?
? ?
2005: VI made HE INDIA a wholly owned subsidiary.
HYUNDAI was positioned at the upper end market. Company had planned to spend heavily for advertising and R&D.
• 2005: VI took over EKL. It brought the Indian rights of
ELECTROLUX for 5 years and 25 years for KELVINATOR. ALLWYN brand also came under the VI fold subsequently.
• 2006: VI announced it will stick its KELVINATOR brand with
Refrigerators and its tagline will also remain same “the coolest one”.
• VI expanded its dealer and showroom network to increase its reach.
?
Prior to liberalization, Indian durables industry was dominated by
Indian brands.
?
By the end of 1990s, the share of Videocon steadily declined.
?
In order to onslaught from the competition, VI adopted the multi branding strategy by acquiring Toshiba, Sansui and Akai.
?
The strategy was meant to fend off attacks on core brand from rivals.
TOSHIBA HYUNDAI ALLWYN KELVINATOR
VIDEOCON
AKAI ELECTROLUX
SANSUI KENSTAR
?
In 2000, VI launched several products under its core brand, Sansui
and Akai and VI was positioned as a Value brand.
?
Positioning and targeting has to be distinct, or else the brands tend to cannibalize each others share.
?
In 1999, VI had market share 10.5% which fell to 7.3% in 2002,
whereas Sansui increased its market share from 4.6% to 6.7%.
?
Having several brands, unless backed by constant upgradation in technology and design would prove to be burden to the company.
?
Inexperience in managing premium brands. For instance, Kenwood
which was a premium brand couldn?t make a dent in the marketing
arrangement.
?
Multi-branding strategy requires deep pockets who can allocate high marketing budgets for each brands.
?
2005 – LG & Samsung lion?s share of T.V. & home appliances market.
?
Philips rejuvenating business in India, Haeir & TCL planning to
establish themselves.
?
Videocon not doing well in all product categories.
Market Shares in Indian Washing Machines Market in 2004
4% 24% 34% LG Whirlpool IFB 13% 11% 14% Samsung Videocon Others
Market Shares in Indian Refrigerators Market in 2005
9% 23%
11%
10% 17%
Videocon Godrej Samsung LG
30%
Whirlpool
Others
?
VI will have to manage its existing brands as well as EKL?s brands.
?
Indian white goods industry very competitive. VI capable of investment in building brand equity.
?
VI should not use price plank for core & premium brands.
?
VI needs to invest in technology.
?
VI may be able to pose a challenge for Korean brands because of its multi-branding strategy.
Q1.
Considering the fact that marketing costs are escalating, how prudent, in your view, is VI?s strategy of having several brands?
?
Good strategy when faced by heavy competition. Protection of core brand. Increases shelf space. Keeping firm?s managers on toes by generating internal competition. Company can fill up price & quality gaps, & saturate the market. Company can serve effectively to brand switchers.
?
?
?
?
?
?
Cannibalization
?
May cause operational confusion.
?
Heavy budgets needed.
?
Videocon a mid-segment brand, inexperienced in handling premium brands (poor management).
Do you think that VI adopted the multibranding strategy because it failed to counter competition with a single brand?
?
Prior to liberalization of the Indian Economy, the Indian Consumer Durables Industry was dominated by Indian Brands like BPL, Onida and Videocon. By the end of 1990?s, Korean brands like LG and Samsung had established a strong foundation in the country by expanding their dealer networks. As a result, VI?s share declined.
?
?
?
In order to onslaught the competition, VI acquired Indian Rights for
brands like Toshiba, Sansui and Akai.
?
Though the share of Videocon fell, the other brands were able to corner market share, thereby giving VI a respectable combined market share.
?
Multi-Branding strategy was akin to warfare. Just as a king is
flanked by several soldiers in a battle, the multi-branding strategy
allowed VI to protect its core brand Videocon.
?
So the strategy was meant to fend off attacks on the core brand from rivals.
With the Korean brands, especially LG, entering rural India in a big way, what in your view are VI?s chance of becoming the No1. consumer durables company in near future? Justify you?re answer
THANK YOU!
doc_664021710.pptx