37164794 ppt the laptop industry

8/4/2019 37164794 PPT the Laptop Industry

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The Laptop Industry

Marketing Management 1,

Group Suzlon, B1


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INTRODUCTION

Part 1


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Indian Laptop Industry

In sync with global trends.

Reasons for growth:

Lifestyle of consumers

Affordability

Better Legislation


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CURRENT MARKET SCENARIO

Part 2


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Sales Growth

Annual sales grew by 114%; CAGR: 104%

Households: 44% of the market growing at 150%,

Businesses: 56% of the market growing at 93%

Notebook sales: 2002-2008


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Sales: City Spread

Notebooks are fast penetrating beyond the top 4 metros;

growth rate 152%


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Global market share

Rank

Brand Q1'07

Q1'08

Y/Y Change

Q1'08 Share1 HP 4.608M 6.460M 40% 20.8%

2 Dell 3.228M 4.683M 45% 15.1%

3 Acer 3.415M 4.527M 33% 14.6%

4 Toshiba 2.399M 2.890M 20% 9.3%

5 Lenovo 1.473M 2.321M 58% 7.5%6 Fujitsu / Fujitsu-Siemens 1.275M 1.612M 26% 5.2%

7 Apple 0.891M 1.433M 61% 4.6%

8 Asus 0.796M 1.330M 67% 4.3%

9 Sony 1.281M 1.321M 3% 4.2%

Others 3.759M 4.529M 21% 18.8%Total 23.124M 31.108M 35% 100%

Table 1: Q108 Top Nine Brand Notebook PC Shipments


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Indian market share


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Government policies

Laptops are covered under Information Technology Agreement-1(ITA-1) and have enjoyed exemption from basic customs duty onimport.

Excise duty: complete exemption for local manufacturers fromexcise duty. imported computers subject to additional customs duty

(levied in lieu of excise duty) equivalent to 7 per cent. VAT: computers have a concessional rate of 4 per cent (importance

attached to the IT sector in India).

Tax changes: Goods and Services Tax (GST) regime to take place in2010. GST would ensure a simpler and more transparent taxregime, and address issues concerning cascading of taxes, multiplecompliances, etc.

The Finance Bill, 2008 has proposed to include computers, includinglaptops, under the MRP regime of excise.


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MARKET SEGMENTATION

Part 3


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Notebook Consumption in Businesses

- By Employee Size

Overall consumption in the business grew by 41%

Consumption in large and medium enterprises grew by 66%

and 61% respectively, however in small enterprises it declined

10%


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Half-Yearly Notebooks Enterprise

Market Overall consumption growth in the Businesses Segment was 16%

Sales to large enterprises grew by 25%; to medium enterprises by 11%

Sales declined in small enterprises by 7%


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SEC Profile of Household Notebook

Buyers

Overall household market increased by 164%

Sales to SEC A increased by 161% and to SEC B by 296%

Sales to SEC C in H1/2007-08 were negligible


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Based On Geography

PC consumption in both West and South grew

by 39% each; in East it grew by 10% while in

North it declined by 13%

Notebook sales: City-spread


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Based on Gender

Global information technology giant Hewlett-Packard (HP) is

set to launch its special lines of products, targeting women

and the youth in India.

"Women usually look for easy mobility and sleek looks, so the

women's product line will be based on those premises.

Texture of the body of the laptop is another factor that

women take into consideration while purchasing, so our

products will reflect that.


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Based on Age and Life Cycle

Kid's laptops are very popular nowadays. Some of the laptops

in market are:

Star Wars Darth Vader Laptop

VTech Double Vision Notebook

VTech Nitro Notebook

Hot Wheels Accelerator 5.0 Learning Laptop

Though much market has not been created, there is lot ofscope of exploring this segment.


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MAJOR PLAYERS AND STRATEGY

Part 4


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Hewlett Packard

Strength Leadership Position.

Consumer Centric Brand.

Strong after sales service.

Design Strategy: looks.

Cost Strategy.

Weakness Low Flexibility: Unlike Dell, HP

does not have high

customization available.

Decline in digital

entertainment market. Software Service.

Opportunity

PC business.

Service Industry: Bought

Worlds no.2 service provider,EDS.

Threat

Pricing pressure.

Component pricing.

Slow revenue growth.


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HP : Market Strategy

Maintain Status Quo as market leader, and continually innovate to strengthenposition.

Products: Notebooks, Tablet PCs, Desktops, Gaming Systems, Printers, Toner,

Paper, Scanners, Monitors, Servers, Software, Networking, Accessories.

Pricing: Oracle's Siebel technology reducing marketing spends by 15%. Cut

notebook prices by 15 to 20% creating a volatile price war.

Promotion: Innovative word of mouth marketing called the 31 days of dragon.

Associates with various Hollywood themes to target movie going audience.

Place: Uses online method for booking. Has outlets in major cities.

Product Development: HP has launched aggressively into the Indian market. Ease

of availability.

Diversification: M&A: In August 2001 HP and Compaq came together to merge bya 25 billion $ stock deal.


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DellStrength

Inventory turnover rate is 6 days. Revenue Growth at 100%.

Cost efficiency.

Direct to customer business model:

minimum credit risk.

Latest technology Customization.

Internet sales leadership: $5M

everyday, worldwide.

Weakness

No proprietary technology. High dependency on component

suppliers.

Lack of Software Support for

customers.

Opportunity

Network service in B2B.

Strong potential in China and India.

Low costs and advanced

technology.

Growth in business, education and

government markets.

Threat

Dells market share very less.

Price range considered premium.

Currency fluctuation.

Political instability.

Tariff trade barriers.


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Dell : Market Strategy Products: PC, laptops, customer service, storage, workstations, and auxiliary

services.

Pricing: Direct Model approach, pricing below competitors.

Promotion: On-line model, direct mail order, catalogues, Premier Pages, special

training and certifications, editorials, reviews, sales reps, and awards.

Place: Direct from Dell: On-line, telephone, mail-order.

Market Penetration: Continue to do more of the same.

Product Development: Pursue Mid-Range Server Growth. By 2001, Dell was the

market leader in entry level servers, but had no presence in the mid-range server

market.

Increase product line: New products like a PDA.

New International Market Development: Enter new markets with existingproducts.

Merger and Acquisitions: By 2000, the external storage market was growing at

23% per year. By acquiring an innovative leading company like the EMC

Corporation, Dell can effectively enter the external storage and software market


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Lenovo

Strength National Image (China)

Knowledge about local market:

Lenovo excels in its strategy for the

Chinese market.

Strong R&D: Taken over from

IBM.

Mass manufacturing capability.

Quick Responsiveness.

Weakness Poor global brand perception.

No pure electronic sales

Low inventory turnover: About 40

days.

Poor After sales service.

Limited knowledge of global

market.

Opportunity

Import barrier.

Increasing global demand.

Internet boom.

Growing wireless pc market.

Governments association.

Threat

Heavy competition.

Industry reaching maturity.

Software piracy and clone market.

Little firms growth.


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UNFULFILLED NEED

Part 5


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Up gradation of Laptop

We are expecting that the up gradation of laptops will be one

of the most important requirements of the people owning

laptops. If the laptops are made compatible enough to

integrate these up gradations and also done at a reasonable

price, it will attract more customers to the product.


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Secondary (Second Hand) Market

People buy second hand, because it is very easy to change the

parts of a PC. It is expected that given the chance of buying

the laptop second-hand with proper provisions of warranty

and reasonable price exchange people will buy it.


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Survey & Analysis

Main areas and features a company should concentrate on should be, strive to provide the best possible customerexperience.

Demography: The age group was primarily 18 to 35 years. A majority number of respondents were from the Indiansubcontinent. Around 15 percent of the respondents were from USA.

The respondents were majorly students and professional. Almost all had used a laptop or possessed a laptop. Aninteresting result was that most of the people who used the laptops gave ratings as good and very good to theperformance of the products they had used. The respondents wanted an Apple laptop when given a choice for thedream laptop. Dell was the first runner up followed closely by HP.

The hardware specifications are the first choice for the users when choosing a laptop. The second choice is the

brand name followed closely by price. Warranty & Services, Mobility, Design and Bundled Software follow suit.This is an interesting insight to the user preference and can prove handy to laptop manufacturers whenconstructing a laptop for the target audience.

pricing: Respondents were ready to pay a high price for quality and sturdiness.

Need: upgrade the laptop. About one third of the respondents do not want an upgrade of their laptop.

An open ended question on the features required on the laptop gave an amazing insight into the needs.Unfulfilled needs

Battery management

Heat Control in the laptops

TV tuner card

Light weightiness

Keyboard Lighting


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Meeting Unfulfilled Need

4 Ps to be catered:

Product: The new product launched will have a better Battery management and heat controlledLaptops. The Laptop will have an inbuilt TV tuner card and also will have a light weight. Additionalfeature provided will be keyboard lighting. Full customization will be provided for customers.

Price: The survey results indicate that the price of the laptops preferred by respondents is rangingfrom 30,000 to 50,000 Rs. A low pricing strategy can also be used by selling laptops lesser thancompetitors Laptops.

Promotion:

Television and Radio advertisements can be used to introduce the product in the market.Primetime advertisements with taglines such as you need it, you have it can be used as this newproduct is introduced catering the unfulfilled needs of the product. Also advertisements should beshown on news channels and sports channels as the target market is students and professionals.

Online, Newspapers and magazines can be used to support the initial promotion. As we aretargeting professional and students these mediums should be effectively used as this is the easiestway to reach our target audience.

Place: Very effective distribution techniques should be used. As we have identified the unfulfilledneed of up gradation, then the process of up gradation should also be very easy and less timeconsuming. In metros free home delivery of the parts can be done and engineers can go house tohouse to upgrade the Laptop. In small towns all the laptop sellers can have a separate departmentfor up gradation and all the up gradation related queries and installations can be handled thereseparately.


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CONCLUSION

Part 6


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ROAD AHEAD

notebook industry is the future of personal client PC market. Based on predictions,the mobile computing notebook devices market are subdivided as ultra mobile subnotebook PCs and notebook PCs.

Innovative educational laptops like, $100 laptops are also looked at as the productswhich rule the future of Indian notebook market.

Laptops with extensive multimedia features continue aiming to gain more

personal, home notebook users, whereas notebooks with longer battery life andhigher performance will continue to cater the needs of business professionals.

Gaming industry being itself in very nascent stages. There are several series in Delland HP which cater to this group already. High speed connectivity and low weightnotebooks generally are most demanded ones today.

HP being top performer in multimedia and personal computer section should tryto concentrate more towards capturing large organizations, and dell the vice versa.

Though notebooks are seen as the replacement of desktops most of the times, it isstill a long way before notebooks sales overtakes that of desktops in number ofunits sold.


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REFERENCES

www.mait.com [manufacturers association of information

technology] for Market Segmentation graphs

policies.gov.in for government policies

india.gov.in/govt/policies.php for government policies

http://www.intelliquest.com/resources/technical/MarketSeg

mentationOverview_MBIQ_June24.pdf for Market

Segmentation

http://www.utdallas.edu/~tskim/Lecture%20Note%206.pdf

for Market Segmentation
http://www.mait.com/http://www.mait.com/


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Thank You.

Questions.

37164794 ppt the laptop industry

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