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“PERCEPTION OF CUSTOMERS IN GUJARAT ABOUT SIS BRANDED PRODUCT".

How feasible is low price strategy for hardware’s in Gujarat?

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Objective of Research

Primary Objective:

To identify the feasibility of Project.

Secondary Objectives:

To identify the perception of SIS branded (desktop, laptop and net top) in Gujarat.

To identify the brand preference of prospects and customers.

To identify brand awareness of SIS products.

Perception about low price strategy of SIS branded products.

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It includes..,

Overview of Industry & Current Market Scenario of Laptop & Desktop in India

Notebook Market in India

Desktop Market in India

Our Primary Research Findings….

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Overview of Industry in India

Figure 1: Total PC (Desktops & Laptops) sale: 2003-09

Overall growth rate from FY 03-04 to FY 08-09: 17% Growth Rate accounted between 15 % 35% till FY 07-08. Growth declined by 7.46% in FY 08-09 over previous year.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

Units3,124,422

Units3,809,724

Units5,046,558

Units6,341,451

Units7,344,306

Units6,796,107

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Overview of Industry in IndiaFigure 2: Total PC (Desktops & Laptops) Quarterly Sales: 2007-08 to 08-09.

In FY 2008-09: Lowest Sales accounted in OND 08., declined in first 3 quarters. Sales increased in JFM every year over previous quarter.

AMJ 07 JAS 07 OND 07 JFM 08 AMJ 08 JAS 08 OND 08 JFM 09 -

500,000

1,000,000

1,500,000

2,000,000

2,500,000

1,771,587

1,512,007

1,759,978

2,300,735

2,076,177

1,615,999

1,436,125

1,668,286

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Overview of Industry in India

Figure 3: Total PC (Desktops & Laptops) Market: Zonal Spread.

PC consumption grew in West and East by 12% and 18% respectively. PC consumption declined in North and South by 34% and 22% respectively.

North West South East0%

10%

20%

30%

40%

25%31%

27%

17%

North West South East0%

10%

20%

30%

40%

18%

37%

23%

22%

6,796,587 Units 2008-09

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Overview of Industry in India

Figure 4: Market share of top brands in Desktop & Notebook Market.

HP remains market leader with 18.2% (over 15.6%) in FY 08-09. Growth declined by 3% over FY 07-08.

HCL came to 2nd place but it sales reduced by 15% Dell on 3rd with declined of sales by 27% Acer remains on 4th spot in FY 07-08 and FY 08-09 with declined in sales by 21% Lenovo on fifth with declined by 41% in sales.

H.P. Dell H.C.L. Acer Lenovo0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

20.00%

2008

2009

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Overview of Industry in India

Figure 5: Notebook (including net books) sales: 2003-09.

Annual Sales increased between 97% to 143% from 2003-04 to 2007-08. Annual Sales declined by 17% in 2008-09 compared to previous year. Nearby 75K Net-Books sold in 2008-09.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090

500,000

1,000,000

1,500,000

2,000,000

88,831177,105

431,834

850,860

1,822,139

1,516,459

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Overview of Industry in India

Figure 6: Notebook sales: City-Spread.

Top four Cities are Delhi, Mumbai, Kolkata & Chennai. Next four are Ahmadabad, Bangalore, Hyderabad and Pune.

Notebook penetration is high beyond top eight cities. Consumption in top 4 metros declined by 38%, in next four cities by 17% and in Rest of India by 10%

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090%

20%

40%

60%

80%

100%

2531

43

5869

7512

8

10

6

77

63 6147

3624

18

Top 4 Next 4 Rest of India

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Overview of Industry in India

Figure 7: Notebook sales in Businesses & Households.

Overall declined in sales by 17% in 08-09. Households accounted 51% while Businesses accounted for 49% of total consumption in 08-09. Declined in consumption in Businesses by 27% and Households by 3%.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

0

500000

1000000

1500000

2000000

88,831177,105

431,834

850,860

1,822,139

1,516,459

Households Establishment Total

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Overview of Industry in India

Figure 8: Notebook consumption in Business by employee size.

Small (up to 10 employees), Medium (10 to 50 employees) and Large (more than 50 employees). Overall consumption declined in business by 27% in 08-09. Consumption in large and small enterprises declined by 47% and 53% respectively while in medium

enterprises it grew by 27%.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090%

20%

40%

60%

80%

100%

14%21%

31%19%

28%18%

46% 27%

22%

25%

29% 50%

40%52% 47%

56%43%

32%

Large Medium Small

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Overview of Industry in India

Figure 9: Profile of Notebook Buyers (in Business Segment).

Government consumption increased by 6 times in 08-09 over 07-08. Consumption in retail outlet grew by 42%, while in factory and office locations consumption declined

by 54% and 46% respectively.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090%

20%

40%

60%

80%

100%

9%23%

10% 5% 8% 5%

79%

70%81% 88% 84%

62%

8%7% 9% 6% 7%

13%

4% 0% 1% 1% 2% 20%

Govt. Locations Outlets Office locations Factory locations

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Overview of Industry in India

Figure 10: Desktop sales: 2003-09.

In 05-06, growth rate was increased from previous year (27%). From 05-06, consumption growth was declined to 19% and 0.58% in 06-07 and 07-08. In 2008-09, consumption of desktop reduced by 242,519 units at rate of (-4%) over previous year.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

3,035,591

3,632,619

4,614,724

5,490,591 5,522,1675,279,648

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Overview of Industry in India

Figure 11: Desktop sales: Share of MNC, Indian & Informal Brands.

Overall Consumption in 08-09 was -4%. Sales of MNC brands grew by 8%. Consumption for Indian brands declined by 22% and Informal (assemble) by 10%.

2005-062006-07

2007-082008-09

0%

20%

40%

60%

80%

100%

28%

23%22%

18%

35%

39% 45%51%

37%38% 33%

31%

Informal

MNC

India

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Overview of Industry in India

Figure 12: Desktop sales: City-Spread.

Consumption in top 4 metros increased by 4% in 08-09. In next four cities declined by 44% while in ROI it remains flat with increase in consumption by 0.02%

in 08-09.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090%

20%

40%

60%

80%

100%

4551 54

60 65 68

1211

138

12 7

43 38 33 3223 25

Top 4 Next 4 Rest of India

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Overview of Industry in India

Figure 13: Desktop sales in Businesses & Households.

Consumption for desktop was 40:60 in Households and businesses in 07-08 while it was 34:66 in 08-09.

Consumption in Business Segment grew by 5% and declined by 19% in Households Segment.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

3,035,591 3,632,619

4,614,724

5,490,591 5,522,167 5,279,648

Home Business Total DTPs

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Overview of Industry in India

Figure 14: Desktop consumption in Business by employee size.

Overall sales in business segment grew by 5%. Sales in small, medium and large enterprises grew by 1.5%, 13.5% and 5% respectively.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090%

20%

40%

60%

80%

100%

21 22 2412

18 18

31 31 28

18

25 27

48 47 48

70

57 55

Large Medium Small

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Overview of Industry in India

Figure 14: Profile of Desktop Buyers.

Overall consumption in business segment increased by 5% Consumption grew in Government Segment by 31%, In Retail Outlet by 22% and in Factory

Locations by 26%. Consumption remains flat in Office Locations with declined by (-0.01%) in 2008-09.

2003-04 2004-05 2005-06 2006-07 2007-08 2008-090%

20%

40%

60%

80%

100%

9% 10% 11%3% 5% 6%

79%79% 74% 84% 81%

77%

8% 7%12% 7% 6%

7%

4% 3% 3%6% 8% 10%

Factory locations Office locations Outlets Govt. Locations

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Our Primary Research Findings..,

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Major Findings.., We have some biased data in our primary research, thus it did not provide 100% precision in result.

But we have enough evidence to identify the feasibility of low cost strategy in Gujarat.

Even though there is a declined in the sales in desktop and laptop in 2008-09 but nearly 80% respondents are interested in Desktop at low price but they need more information about products, while for laptop respondents would preferred to purchase branded product because of low price margin.

With age group of 16-24 years are more interested in SIS branded products than other age groups respondents.

More respondents are aware with E-mall brand (84%) than SIS brand (65%) while brand awareness for SIS is high in Government Segment.

Not more than 10 respondents were able to recalled SIS brand in first three brand recall.

For more than 60% respondents brand is more important than low price of hardware.

For 80% respondents information on website, word-of-mouth and advertisement are the three most important factors influencing their purchase decision.

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Thank You…