lakme marketing strategy final

Marketing Strategy Formulation &

ImplementationMM-II Assignment II

Section A

Group 12

Ankit Kapoor (13)

Chandni Kripalani (25)

Mohit Bahl (37)

Rinkesh Garg (49)

Vinay Ajmera (62)

Marketing Strategy formulation & ImplementationPhilips India

Executive Summary

Our objective in this assignment was to devise a marketing strategy for the mp3

players of Philips India Ltd. In this process we studied the varied elements of

the marketing mix and how they interact in the case of the digital music player

industry.

The methodology given in the course outline has been strictly followed for this

assignment. The Indian mp3 player industry promises tremendous growth in the

future which had opened new opportunities for the companies. The industry

witnessed a growth of 116% in 2007 and promises a compounded growth of

77% till 2010. Using its technical expertise in a technology driven industry,

Philips can capture a good portion of the market. However, the competition is

intense and Apple enjoys a substantial 70 % of the market. Therefore, Philips is

required to continually redefine its offerings, in order to stay relevant in the

market.

In this assignment, we have taken these considerations into account and framed

a strategy for the company with respect to its product, price and promotion.

Widespread growth of internet has made it an important marketing tool and

thus, we have formulated an online marketing plan for the company as well. We

have also devised a budget for the above mentioned plans.

With the help of product innovation, new pricing and distribution strategy,

Philips can attempt to increase its market share and reap benefits of the growing

mp3 players industry.


About the Company

Mission Statement

We improve the quality of people's lives through the timely introduction of meaningful

technological innovations.

Vision Statement

In a world where technology increasingly touches every aspect of our daily lives, we will be a

leading solutions provider in the areas of healthcare, lifestyle and enabling technology,

aspiring to become the most admired company in our industry as seen by our stakeholders.

Company Strategy

Increase profitability through re-allocation of capital towards opportunities offering

more consistent and higher returns

Leverage the Philips brand and our core competencies in healthcare, lifestyle and

technology to grow in selected categories and geographies

Build partnerships with key customers and suppliers, both in the business-to-business

and business-to-consumer areas

Continue to invest in maintaining world-class innovation and leverage our strong

intellectual property position

Strengthen our leadership competencies

Drive productivity through business transformation and operational excellence


Situation Analysis

Globally, the top 10 MP3 brands control 96% of the market.

These brands in descending order, are as follows-

Portable MP3 Player Total

2004 $396,559,700 Portable MP3 Player Total

2003 $848,118,469

1 Apple 1 Apple2 Other 2 RIO3 Sony 3 iRiver4 Rio 4 RCA5 RCA 5 Digitalway

Top Five Brands 70.20% $278,384,909.4 Top Five Brands

86.40% $732,774,357.216

6 Archos Tech

6 Creative Labs

7 Creative Labs

7 Samsung

8 Samsung 8 Nike-Philips

9 Panasonic 9 Memorex10 Nike 10 Archos

TechTop Ten Brands 68.70% $272,436,513.9 Top Ten

Brands96.00% $814,193,730.24

Source: TWICE’s 2003-2004 Market Share Reports by Category

The Indian music industry will grow to Rs. 4100 crores in 2009 from Rs 1,450 crore in 2005.

And this growth will be mainly driven by by mobile music, which will account for 88 per

cent of the music industry’s revenues. Mobile music will be driven by all formats like

ringtones, ringback tones, full track audio and video downloads. However, online music

sales will remain minimal for the next three years.


Digital music sales surpassed physical music in sales in India in 2007.

The sale of digital music has a direct impact on the MP3 player industry. So it is assumed that

follows a similar trend as the sale of digital music.

With prices coming down due to lower cost of storage, the MP3 player market is growing

exponentially. As per IDC estimates, in India the market for MP3 players witnessed a growth

of 116% in 2007, and the demand will continue to surge to 73,34,000 units by 2010, at a

CAGR of 77%.


The players in the domestic market include-

Apple

LG

Philips

Sony

Toshiba

Samsung

Creative

iRiver

Archos

The brands like Philips, Apple, Creative, Sony and Samsung have the main market

share.

Porter’s five forces

Buyers Power:

(i) No single consumer has any power over

the production levels or prices of the various

products offered. Almost all units of MP3

players are sold through:

a. Philips Franchisee stores

b. Philips Exclusive outlets

c. Multi-brand outlets

d. Online marketplace

Most of these units are sold directly from

the producer.

Supplier Power:

The components needed to produce a portable music

player include:

• hard drive or flash memory

• processing chips

• user interface units

• general

• Assembly, and design ability.

Since Apple enjoys an almost 90% market share in

the hard drive based market, they have considerable

buying power over the suppliers.


(ii) In case of IPOD switching cost of

changing over to another mp3 player is high

as the player only supports proprietary

music, but this is not the case for other mp3

players.

Smaller players in the portable music market, such as

Phillips would have difficulty acquiring the deals

Apple can receive.

Degree of competitive rivalry:

The expected yearly growth of the industry

is around 20%.

• Competition in the mp3 market is going to

be fierce

• Lower prices

• Newer and better features

• Technology will characterise the

industry.

Barriers to entry

The barriers to entry are:

(i) Technical Knowhow: However, this may be

outsourced as well

(ii) Brand Positioning: Apple relies heavily on

franchising and advertising on television and

billboards.

(iii) Component prices: Through its volumes, apple

is able to claim the lowest prices.

(iv) Market share is locked in with higher switching

costs (once consumer has purchased a variety of

proprietary music

Threat of substitutes:

(i) Convergence: cell phone and an audio player in the same device

(ii) Flash based players and hard drive based players are substitutes for one another

(iii) Portable video players having features of an audio player.


Swot Analysis

Strengths Weakness

Advancement of technology

Substantial investment in R&D

leading to breakthrough inventions

like CD-RW and DVD

Long presence in the country (75

yrs)

High Brand awareness

Efficient supply chain and wide

distribution networks

One of the earlier entrants in the

mp3 segment

Lower variety as compared to

competitors

Low awareness of Philips mp3

players

Opportunities Threats

Growing market - Significant

growth for mp3 players in the past

year.

Rising sales of digital music

Institutional sales - for e.g. Diwali

gifts to the employees.

Cell phones with music players

Fierce competition of existing players

Entry of new players like Microsoft

Zune

Rapidly changing technology - high

product obsolescence


Goals & Objectives

Objectives

To position Philips as a market-driven, people-centric company

Fully reflect the needs of its customer base, while also increasing shareholder value.

Goals

Increase sales by 20%

Double the market share to 8% by 2008-09. i.e. 400000 units

EBITA to exceed 10% through improved margin management, product improvement

and cost savings.

Segmentation

Characteristics Product

Daily Commuter

They look for portable music players;

inexpensive options to play music on the

move. Basic Audio Players

Serious Audiophile

Extensive users, brand loyal, Prefer

Dedicated MP3 player over the hybrid

type Hard Drive Based Player

Travel Mate

They look for portable music players;

that are light and easy to carry with

reasonable capacity to carry music

Micro hard drive based

player

Workout

Companion

They look for compact music players;

with shockproof operations, where music

does not skip with jerks; also they look

Flash-based players


for the shuffle option

Light Listener

They look for relatively inexpensive

music players, with stylish looks,

interchangeable covers

Micro hard drive based

player


Product analysis

Product mix width - 2

Product mix Depth - 5 for audio and 8 for audio/video players.

We can see that the audio/video line has a greater variety. The reason being that this is the

latest in this technological warfare and tough competition exists from other competitors in the

same category.

Also this segment is growing at a rapid pace.


Philips India offers MP3 players under the product category of Portable Audio and Video

Products. This category broadly includes 4 heads:

i. MP3 Players

ii. Audio/Video Players

iii. Radio/cassette recorders

iv. DVD Players

The product chosen by our group covers the first 2 i.e. MP3 players and Audio/Video

Players. Audio/Video Players have been included because these players not only offer the

basic features of a MP3 player, but also additional features like videos, built in speakers and

LCD display. Philips has a total of 13 products under these 2 heads. The company offers a

variety of features to serve the needs of different customers at affordable prices. The basic

features differentiating the products are:

1. Memory: The memory of the products offered by the company ranges from 1GB

to 8 GB. The basic MP3 players which are also called flash audio players have a

maximum memory of 4 GB. Flash audio/video players have memory ranging from

4 GB to 8 GB.

2. Video playback: The audio video players offer videos and movies playback. The

products are capable of playing back latest video formats such as MPEG 4 and

WMV.

3. Battery Back up – The lower end items offer an average battery back up, while

the higher end audio video players offer a 15 hours music or 4 hours video

playback which is in sync with the current scenario in the industry.

4. FM Tuner – Philips has products which also offer FM tuner along with MP3

playback in order to compete with other players in the industry.


Product Levels

Core benefit Music

Basic product A portable music player

Expected product Good quality sound, Easy to carry and

operate. Good battery life, Durable, clear

display

Augmented product Video, FM, Voice recording, games

Potential product Camera, Bluetooth, GPS

The portable mp3 players are currently in the growth stage of product life cycle.

MP3 players are products which are mainly based on technology. The life cycle of the

technologies used plays an important role in managing the product line.


The above technology product life cycle shows that they are 2 types of customers:

Early Adopters: who accept the technology when it is in the growth stage. This is majorly

happening for flash audio players. The audio players have found a lot of adopters. Philips has

a sufficient range in this product line,

Late Adopters: who accept the technology after it has been widely accepted and the prices

have also decreased. This is happening for audio video players. Although, these players have

had a significant acceptance, it is quite low as compared to audio players.

In the future, the strategy will be to focus on these late adopters because the prices are

expected to fall and people are now more willing to accept to new technology. Video players

have been accepted by early adopters and soon they will come to a point when this would

become a basic feature desired by users.


Pricing

PROMOTION

P

R

I

C

E

HIG

H

LOW

HIGH LOW

Rapid Skimming

Strategy (RSS)

Slow Skimming

Strategy (SSS)

Rapid Penetration

Strategy (RPS)

Slow Penetration

Strategy (SPS)

Currently, Philips is following a competitive pricing strategy as its prices are marginally

lower than its major competitors. Also its promotion is very low as compared to other major

players. So we can say that Philips is following a slow skimming strategy.

The new product should be launched with a Rapid skimming strategy. The new features

should be used to charge a premium and establish it as a status symbol. Heavy promotion

should be done to generate high awareness.

The prices of other products will match those of the competitors.

MP3 Players Was Now Percentage Reduction

Samsung-YP-T10QB (2GB) Rs. 6,900 Rs. 6,550 5.3%

Samsung-YP-U3 (1 GB) Rs. 3,300 Rs. 3,149 4.8%

Samsung-YP-K5Q (2GB) Rs. 9,000 Rs. 8,699 3.5%

Samsung-YP-T9A (4GB) Rs. 15,000 Rs. 8,149 84.1%

Samsung-YP-K3QB (2GB) Rs. 5,500 Rs. 5,449 0.9%

Sony-NW-E005F/V Rs. 6,990 Rs. 3,990 75.2%


Sony-NWZ-S616F/B Rs. 9,990 Rs. 7,990 25.0%

Sony-NWZ-S615F/S Rs. 7,990 Rs. 5,990 33.4%

Sony-NW-A805/V Rs. 7,990 Rs. 5,990 33.4%

MP3 Players Was Now Percentage Reduction

Sony-NW-A806/W Rs. 9,990 Rs. 7,990 25.0%

Sony-NWD-B105F/B Rs. 4,990 Rs. 4,490 11.1%

Sony-NWD-B103F/W Rs. 3,990 Rs. 3,490 14.3%

Sony-NW-E003F/G Rs. 5,990 Rs. 2,990 100.3%

Transcend-T.sonic 840 (2GB) Rs. 5,500 Rs. 3,200 71.9%







Creative-ZEN (4GB) Rs. 9,999 Rs. 6,800 47.0%

Creative-ZEN V PLUS (2GB) Rs. 8,890 Rs. 4,999 77.8%


Creative-Zen Stone Plus (2GB) Rs. 4,990 Rs. 4,399 13.4%

Creative-Zen Stone (1GB) Rs. 2,599 Rs. 2,100 23.8%



Creative-ZEN Vision (30GB) Rs. 18,990 Rs. 11,500 65.1%

Apple-iPod Shuffle (1GB) Rs. 2,700 Rs. 2,699 0.0%

Apple-iPod classic (160GB) Rs. 20,500 Rs. 18,999 7.9%

Apple-iPod nano (8GB) Rs. 11,400 Rs. 9,995 14.1%

Apple-iPod classic (30GB) Rs. 14,600 Rs. 12,995 12.4%

Apple-iPod Touch (16GB) Rs. 23,600 Rs. 21,500 9.8%

Apple-iPod Touch (8GB) Rs. 17,700 Rs. 16,500 7.3%

The above table shows the reduction in the prices of MP3 players of major players in the

industry. It is clearly evident that there is a significant reduction in prices, reaching even 100

percent for a couple of products. On the basis of this information, we predict that Philips shall

also reduce its prices in order remain competitive. The following table summarises the

pricing strategy of Philips:

Current

Prices

Prices in August

2008

Prices in January

2009

SA 1356 2,499 2,250 1,999

SA 2315 2,999 2,749 2,499

SA 4325 4,990 3,499 2,999

SA 3025 4,300 4,000 3,499

SA 3325 5,999 4,499 3,499

SA 3345 6,999 5,999 4,499

SA 6045 8,999 8,000 6,999

SA 6185 15,999 13,499 10,999


It is assumed that some older models would be discontinued on account of continuous

technology advancement in this sector. The introduction of new models during the year is

another reason for lowering the prices. The new models would be introduced at above the

current prices.


PLACE

Philips has set up a chain of its company owned stores called Philips Arena. There are

currently over a 100 Philips Arena stores. Apart from these its products are available through

various exclusive Philips outlets and MBO’s throughout the country. Its distribution network

covers over 540 districts across India.

With the advent of modern retail in a big way Philips has to make its presence at stores like

Croma, Next, Reliance Digital and Electronics Bazaar. It has to employ a key account

management approach.

Philips has 103 service outlets which provide service support to its consumers.

Channel Design

Philips India Ltd Philips India Ltd

Arena/Modern Retailers

Consumer Arena

Exclusive retail stores/ MBO’s

Agency

Philips India Ltd

Arena

Exclusive retail stores/ MBO’s

C&F agents

Distributors


Product Development

The current features being offered by Philips are unable to differentiate it significantly from

its customers.

Areas where Philips lags behind its competitors:

o Battery life

Apple’s video ipods offer a battery life of around 30 hrs whereas a comparable

product from Philips has a battery life of around 15 hrs.

Recharge time is also greater by almost an hour in case of Philips

o Storage Capacity

The maximum capacity offered by Philips is 8GB whereas Apple has touched 160

GB.

Even one of its greatest threats, mobile phones now come with 8GB storage

capacity

o Looks & Design

Philips mp3 players are bigger in dimension as compared to almost any of its

competitors

Heavier - Lack sleekness

Models available only in one colour

Areas where Philips has an upper hand

o Display

First to introduce an LCD display.

One of the largest display screens.


Good clarity

o Others

Built in speakers

Introduced Games

Sturdier than its competitors

The New Product

The shortcomings should be kept in mind for developing the new product.

Accordingly, the new product shall have the following features

Change in looks

A much sleek design

Lightweight

Different body colours - for e.g. Apple nano comes in 5 colours.

Approximate dimensions

Weight 120 gm

Width 60 mm

Depth 8 mm

Height 110 mm

Battery life to be at least doubled to match Apple’s 30 hrs. Charging time to be reduced.

Storage capacity to be at least 40 GB


Differentiating Features

Touch screen to be introduced +3500

Camera - at least 2 megapixels to be included + 2000

Bluetooth + 1000

GPS

WiFi +800

E-Mail service

Cost

These differentiating features coupled with improvements in other areas like battery life and

storage capacity will allow us to charge a premium.

A comparable product, excluding the differentiating features mentioned above would cost

around Rs. 20000. These features would cost us an additional Rs. 7300. We would go in for a

much higher price along with heavy promotion i.e. rapid skimming strategy.


Promotion

Advertising Agency

Philips hires an external agency to handle its entire advertising effort. The current advertising

agency for the company is Mudra Communications Pvt. Ltd.

The promotion strategy will be based on the five M’s of advertising

Mission

To create brand awareness and knowledge

To establish the product as a status symbol and create a liking, desire and preference.

To create a perception that the company is charging higher price for superior features and

quality.

Money

Very high competition and low awareness.

New features are being introduced

Frequency - Advertise heavily (Rapid Skimming Strategy)

Message generation and Evaluation

The advertisements will position the brands in such a way that it first highlights the brand

Philips and then focuses on the features. Also the heavy advertising for the new product will

have a roll over effect on the other products creating greater acceptance for them.

Media


Magazines

Philips will advertise with 2 magazines that include articles regarding latest electronics, at

first, to check which one of them is most effective for advertising into, in the future. It will

place these advertisements @ Rs. 50000/issue/advertisement alternatively in each month (i.e.

6 ads per magazine)

Newspapers

Phillips will utilise 3 major and popular dailies to advertise its products. It will place these

ads every Sunday (ie 52 days) @ 450 cm/sq inch

TV

TV advertisements must be included to increase mass awareness. It will thus advertise once a

week (i.e. on 52 days) in a mix of 3 popular news and sports channels (during popular

programmes and matches) around 2 times a day.

Internet

Internet plan has been enumerated below. For the purpose of promoting the website, the

company will pay a popular search engine such as google money according to the pay-per-

click mechanism. The cost per click is approximately Rs. 5 per click. (It is assumed that the

website generates 100 clicks/day).

Promotions

(i) Free leather case worth Rs. 500 for MP3 players with MRP exceeding Rs. 10,000.

(Cost to the company for the leather case = Rs. 100. Expected Sales= 4,00,000 units. It is

expected that the value of 20% of the units are greater than Rs. 10,000)

(ii) With every MP3 player, Phillips gives its customers 1 MP3 of 100 songs each. (Cost to

the company for the leather case = Rs. 5, songs cost assumed to be negligible, as they will be

culled out from employees songs libraries)


Sales Force

The company will require sales force to serve as an interface between the company and the

distributors. It is assumed that they will employ a sales force comprising of 30 executives @

Rs. 15,000 per month.

Publicity

The publicity will be carried out through word of mouth through ‘viral marketing’. This will

be done by encouraging forum discussions through social networking website’s and will be

carried out through the web research staff. As such this segment has not been taken

separately and the cost is assumed to be nil.

Web Research

The web research staff of 4 executives will be carrying out all the web promotion activities

and monitoring the customer’s needs and expectations from the website though comments

and suggestions received via participation in the website’s consumer research questionnaire.

Additionally they will also be involved in promotion in the social networking website’s as

mentioned above.

Promotional Program’s- Events

MP3 Mania' programme targeting the youth which is the key target segment for the

company. The ‘MP3 Mania' programme which was launched in Chennai, Mumbai, Bangalore

and New Delhi. The concept was to go to youth hang-outs, schools and colleges, and educate

the youth about the technology behind mp3’s. The program helped the company notch up a

45 per cent share in the MP3 market.

The Philips Mahasangram Integrated Marketing Programme: A key reason behind this

initiative seems to be the growing potential of the rural market. Launched in July, 2002 was

introduced to promote a entirely new set of products to meet the requirements of rural

customers. The aim: To aggressively push the company's sales in the rural/semi-urban

segment with a clear focus on rural towns with a population of less than 5,000 and semi-

urban towns with a population between 5,000 and 50,000.


Print Campaigns: The current marketing campaign of the company is Sense and simplicity.

The rationale for the campaign is to portray that technology can be advanced and simple at

the same time. It can be easy to experience. It can be designed around people. [Annexure

No.2]

Other print Campaigns

Let's make things better: This was the longest campaign of Philips and was used as a

promotional programme for the entire gamut of consumer electronics. They wanted to

emphasise that they are the innovators of audio cassette, mp3 players, the compact disc and

the co-inventors of the DVD. They portray themselves, through this campaign to be devoted

towards improving processes. [Annexure No. 2]


Website Review

Philips has a website already in place. It is quite an extensive website and has all the

company and product information. If the company adds price information and payment

mechanisms, it will be able to immediately start selling online. It can thus very easily get the

following benefits-

1. Get a new distribution channel and thereby increase market reach. This channel is

accessible round the clock, all days of the week in those areas where physical outlets

have not been established.

2. Visibility- In the ubiquotous market, philips will be able to get a competitive edge. It

can claim greater presence among the current market as well

3. Establishing and maintaining business relationships- Philips can use the website to

create new business relationships with its suppliers and institutional clients.

4. It can promote relationship building with its partners and customers.

5. Reduction in cost

Concerns

1. in order to establish a web presence it is essential for the content to be comprehensive

and easy to understand. This would be able to improve page views and hence, the

site’s traffic.

2. It might eventually conflict with the sales from its physical distribution channel

network.

3. It will have to face and try to counter huge amount of competition from the online

sector.


Comment on the website appearance

The website has very light tones and colors such as light blue’s and grey’s

It is representative of its latest advertising campaign of sense and simplicity as well.

The website seems simple, yet it is modern in features.

The text is very organised.

Links are placed to connect to its global website’s to cull out financial and other

company information.

At the same time, finding information within links is a cumbersome process. It does take a

while to find specific information within the website, although the search bar has been

provided for the purpose.

Comparative Website Statistics

Reach for Philipsindia.com:

Percent of global Internet users who visit this site

Yesterday 1 wk. Avg. 3 mos. Avg. 3 mos. Change

N/A* 0.00005%% 0.000175% 35%

Reach for Apple.com:

Percent of global Internet users who visit this site


0.935% 0.94% 0.994% 3%


Traffic Rank for Philipsindia.com:

Alexa traffic rank based on a combined measure of page views and users (reach)


N/A* 1,061,544 452,984 142,656

Traffic Rank for Apple.com:

Alexa traffic rank based on a combined measure of page views and users (reach)


103 104 87 3

Page Views per user for Philipsindia.com:

The number of unique pages viewed per user per day for this site


N/A* 2 3.4 No Change

* Daily values are not available for sites ranked outside of the Top 100K.

Page Views per user for Apple.com:

The number of unique pages viewed per user per day for this site


4.2 4.1 4.2 2%


Measures:

Phillips must improve the content on its website and start online sales in order to increase its

traffic statistics. It must thereby, include the following-

Product information (mp3 players)

All the products are listed on the website.

Features for the products are listed via listing and downloadable pdf documents

Comparison among products across technical features has been given, which is an

excellent feature.

The pictures for the product are clear, and a 360 degree view of the same is available.

The page is printable, which is a useful tool

Disadvantages-

The main disdvantage is that the prices of all the products is not mentioned on the

website.

List of physical outlets/stores from which the product will be available is mentioned

but requires the customer to feed in a lot of product information before receiving the

information.

Customer Support

Support link is given alongside every product

The link gets directed to FAQ’s immediately

A provision is given whereby in case of unfulfilled service needs, two telephone lines,

website link, and email helpline is mentioned.

The disadvantage is that the website mentions that the customer needs to have the following

data handy-

- The model number of the product


- The date of purchasing

- The serial number of the product.

At most times, this information is not readily available with the customer.

Payment

The company needs to provide a payment mechanism that is both secure and convenient. It

may use any or all of the following for payment purposes-

Credit cards

Electronic Transfers

Electronic wallets, checks etc

Near cash credit card is the best way for the company [Annexure 3]

Philipsindia.com has a traffic rank of: 68452,984

Apple.com has a traffic rank of: 87

The aforementioned fact reveals that in order to reach the level of its nearest competitor,

Phillips would have to realign and redesign its website to attract more visitors and increase

page views.

Delivery

In order to prevent channel conflicts, Phillips must make use of its current delivery network

to send the goods to the customers.


Feedback and review

In order to ensure the reliability and relevance of data, the company has already instituted

measures to receive feedback from its customers. This has been done via a questionnaire that

can be voluntarily filled by the customers. [Annexure 4] The information received will be

used by the company to improve its online and general operations.

Website Promotion

1. Besides improving content, Phillips will have to engage in Promotion to increase the

awareness of the online selling facility:

2. Blogs- Articles in other blogs/websites include the company’s website link. This will

help to increase website visits and page views.

3. Pop-up Banners

4. Registering with search engines with tools such as keyword search, sponsored links

Online selling strategy

The website of Philips is already in place and which is having a good impact on the visitors.

Certain things can be taken care as talked about above and the site can be improved. For

online selling we should have certain additions like the –

1) The payment mode should be mentioned.

2) Online selling option to be added which is clearly visible.

3) Terms and conditions.

4) Method explaining the procedure of online selling, etc

Online selling is an innovative idea and will be becoming a trend in the coming years. So it is

good to start as early as possible. The impact of internet can be judged by the growth rate of

internet users in the table below.


YEAR Internet Users Growth

1998 1,400,000 -

1999 2,800,000 100

2000 5,500,000 96

2001 7,000,000 27

2002 16,500,000 136

2003 22,500,000 36

2004 39,200,000 74

2003 37,00,000 -6

2005 42,000,000 14

2006 54,000,000 29

For promoting the online selling strategy by Philips India our target market are the people

who are having the knowledge of internet and are able to operate it. Thus we will be targeting

the internet population of 54 million. This will be done advertising through the medium of

internet marketing as well as other promotional activities.

Internet marketing will include –

1) Blog marketing – This will help to promote our product to more of a active

population on internet and it will cover ¼ th of the internet user population.

Exhibit can be referred. This will be made effective through various

techniques like banners, sponsored links, etc.

2) Banners and pop-up’s can be placed on the site most visited and these sites can

be identified through the table below.


Rank Online Activities % undertaking

in 2007

%

undertaking

in 2006

Sites

1 E-mailing 95% 94% Gmail, yahoo, rediff, etc

2 Job search 73% 53% MonsterIndia, Naukri.com, etc

3 Instant messaging 62% 37% Yahoo, gmail, msn

4 Check news 61% 48% Timesofindia.com,hinduonline.com,

etc.

5 Online music 60% 49%

6 Chatting 59% 57%

7 E-greeting 58% 57% Indiatimes.com, etc

8 Check sports 57% 35% Cricinfo.com, etc

9 Online games 54% 34%

10 Dating/Friendship 51% 27% Orkut, hi5, etc

Other uses of the site –

Interaction between customers can be encouraged.

Reviews of the customer about the product can be obtained.

Customer grievances can be considered online.

Mode of payment –

As given in Annexure 3, the various modes of online payments are analysed and we found

that the payment through credit and debit card, stored value, etc are best.


The option of basket can also be induced where the goods can be put in the basket and then

all the goods can be purchased at one time.

Marketing Budget

Expense Description Cost per unitAnnual Total

Research

Web research 4 Executives Rs. 11,000/Person/Month 528,000.00

TOTAL 528,000.00

Media

Magazines 2 Magazines x 6 Issues Rs. 50,000/Issue/Advertisement 600,000.00

Newspapers 52 Daysx 3 Newspapers 450/cm sq 70,200.00

TV 52 Daysx 3 Channels x 2 Times a Day 2,50,000/30 Sec 78,000,000.00

Internet 100 Clicks/Day Rs 5/Click 182,500.00

Promotions 80,000 Units Rs 100/Case 400,000.00

4,00,000 Units Rs 5/cd 2,000,000.00

TOTAL 81,252,700.00

Sales Force

Expenses 30 Executivesx12 15,000/month 5,400,000.00

TOTAL 5,400,000.00

Publicity Through Word of Mouth -

TOTAL 0.00

OTHER N.A -

TOTAL 87,180,700.00


References

Books

Phillip Kotler- 12th Edition.

Marketing Management- Readings

Websites

www.philips.com

www.apple.com

www.npithub.com

www.alexa.com

www.contentsutra.com

www.indiahousing.com

www.consumercharts.com

www.indiastats.com


Annexure


Annexure 1


Annexure 2


Annexure 3


Annexure 4

How did you arrive at this website?

By typing a website address (e.g. www.philips.com)

I have the Philips website stored in 'my favorites' (stored website links)

Through a search engine (e.g. Google)

Through a link on another website

Through a link in an e-mail

Other (please specify)

How often have you visited this website in the past 3 months?

This is my first visit ever

This is my first visit in the past 3 months

2 to 5 times in the past 3 months

5 times or more in the past 3 months

You arrived at this website through a link on another website. What type of website was this?

Another Philips website

An online shop/retailer/dealer

A website for product reviews and comparisons

A website from a Philips partner

A forum/blog/community website


A job board


Please indicate if this visit is primarily for:

Business reasons (I come here for my work)

Personal/private reasons (I come here for my personal life)

Which of the following statements best describes the main purpose of your visit to this website?

To browse/to find (information on) a specific product/service I am interested in

To find information on a product/service I already own or use

To find service or support on a product I already own or use

To buy/order a product/service

To find out more about Philips as a company

To understand more about 'Sense and Simplicity'

To find a job/to find out more about career opportunities at Philips

To contact Philips for service or support

To contact Philips for other reasons

Nothing in particular, I'm just checking out the website


Strongly agree Agree Neutral Disagree

Strongly disagree

The menus, buttons and links in this website are easy to understand

The structure of this website is well-organized

This website is user friendly


This website is well designed (look & feel)

I did not have to wait long for the pages to load


Annexure 5

Philips Sa6185 Sony NW A808 Apple ipod touch Samsung YPP2CB

Display

Type Flash Flash Flash Flash

Memory

Capacity (GB) 8 8 8 8

Number of Songs 2000 2000 2000 2000

Expandable Memory

Display

Display LCD LCD

Colour or Monochrome

Colour Colour Colour Colour

Display Size (Inch) 3.5 2 3.5 3

Display Resolution 320x240 240 x 320 480 x 320 480 x 272

Audio Features

Audio Format Supported

WAV, WMA, MP3 MP3, WMA, AAC, Linear-PCM and ATRAC

AAC, ACC Protected, MP3, MP3 VBR, Audible, Apple Lossless, WAV and AIFF

MP3, WMA, OGG

Voice Recorder ---

FM Radio

FM Recorder ---

Visual Features

Photo Viewer

Photo Format Supported

JPEG JPEG JPEG, BMP, GIF, TIFF, PSD and PNG

JPEG

Video Player

Video Format Supported

DVD,AVI,MPEG1,2,4, MOV,WMV and RM

MPEG4, AAC-LC and AVC

M4V, MP4 and MOV

SVI, WMV

Battery

Rechargeable Battery


Battery Type Inbuilt Inbuilt Inbuilt Inbuilt

Standard Battery Type Li Polymer Li Ion Li Ion Lithium Polymer

Battery Life for Music Playback (Hours)

15 30 22 35

Battery Life for Video Playback (Hours)

4 8 5 5

Recharging Time (Hours)

4 3 3 4.5

Type of Charging USB Charging USB USB Charging USB

Sound Settings

Equalizer

Preset Options 6 6 --- ---

Keypad Features

Hold Key --- ---

Requirements

Operating System Windows XP (SP2 or above), Vista

---

Mac OS X v10.3.9 or later, Windows Vista, Windows XP Home and Professional SP2

Windows XP, 2000, ME, VISTA

PC Interface USB 2.0 USB 2.0 USB 2.0 and Wi-Fi USB 2.0

Connection Options

Bluetooth

WiFi

USB

Security Features

Password Protection --- --- ---

Colour

Number of Colour Options Available

--- 1 1 3

Colour Options Black Black Black White, Black, Red Wine

Additional Features

Contacts

Calendar ---

Games


Clock

Machine Dimensions

Width (mm) 39 44.5 61.8 100

Dimensions

Depth (mm) 153 9.6 8 9.9

Length (mm) 43 88 110 52

Weight (Grams) 153 53 120 85

In the Box

Earphones

USB Cable ---

Carrying Case ---

More Features

Unique Feature Touchscreen, You Tube and Web Browser

Touchscreen Display, 3D Sound, Bass Extension, 16: 9 wide screen

After Sales Service

Warranty Period (Years)

--- 1 1 1

lakme marketing strategy final

Documents