final internship project.doc1

7/31/2019 Final Internship Project.doc1

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Xavier Institute of Management & ResearchXavier Institute of Management & Research

Company Profile

Introduction

The Videocon Group emerged as a USD 4.1 billion global

conglomerate continuing to set trend in every sphere of its activities

from a conference room sized assembly line in 1979.

Videocon is an industrial conglomerate with interests all over the world

and based in India. The group has 17 manufacturing sites in India and

plants in China, Poland, Italy and Mexico. It is also the third largest

picture tube manufacturer in the world.

Company is founded in 1979 by Mr. Nandlal Madhavlal Dhoot having

headquarter in Aurangabad, Maharashtra, India.

Corporate profile

The Videocon group has an annual turnover of US$ 4.1 billion, making

it one of the largest consumer electronic and home appliance

companies in India. Since 1998, it has expanded its operations

globally, especially in the Middle East.

Today the group operates through six key sectors:

Consumer electronics

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In India the group sells consumer products like Colour Televisions,

Washing Machines, Air Conditioners, Refrigerators, Microwave ovens

and many other home appliances, selling them through a Multi-Brand

strategy with the largest sales and service network in India. Videocon

Group brands include Akai, Electrolux, Hyundai, Kelvinator, Kenstar,

Kenwood, Next, PlanetM, Sansui, Toshibha, Philips (TV Products) etc.

Mobile Phones

In November 2009 Videocon launched its new line ofMobile Phones.

Colour picture tube glass

Videocon is one of the largest CPT Glass manufacturers in the world,

operating in Mexico, Italy, Poland and China.

Oil and Gas

An important asset for the group is its Ravva oil field with one of the

lowest operating costs in the world producing 50,000 barrels of oil per

day.

DTH

In 2009, Videocon launched its DTH product, called 'd2h'. As a

pioneering offer in the Indian DTH market, Videocon offered LCD &

TVs with built-in DTH satellite receiver with sizes 19" to 32". This

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concept in the DTH service is relatively new in the presence of other

players like ZEE tv's Dishtv, Tata Sky, Air tel Digital Tv and Reliance's

BIG TV providing only the set top box.

Telecommunication

Videocon Telecommunication Ltd has license for mobile service

operations across India. It launched its services on 7 March 2010 in

Mumbai.

History of Videocon Group

Year Sector

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1989- Colour & B/W TV

- Washing Machine

1989-

90

- Home Entrainment

System

- Electric Motor ,AC
http://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Mumbai


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Year Sector

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1991- Refrigerator

- Coolers

1995- Glass Shells for CRT

1996- Kitchen Appliances

- Crude oil

1998- Compressors

- Compressors

2000- Philips colour TV

plant takeover

2005- Electrolux India 3

plants takeover


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Awards:

Man of Electronics Award to Mr. P.N. Dhoot, president of

Videocon Group in the year 2005 by CETMA(Consumer

Electronics and Television Manufacturing Association.)

RAHBIC Award (Related to Recruitment) in the year 2005.

BRAND EQUITY rated Videocon Group as No.1 Brand in

consumer durables for the year 2007.

Consumer Durables in India:

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2009- Mobile Phones

- DTH

2010- Telecommunication


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philips Onida videocon

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philips Onida videocon

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Project Overview

Videocon Appliances Limited

Organization name: Videocon Appliances Limited

Location: Videocon Appliances Limited,

15 Km Stone , Aurangabad-paithan

road,

Village Chitegaon.

Tq-paithan,

Dist: Aurangabad-431105.

Size: Land 8,26,000 Sq-Meter

Quality Certificate: ISO 9001:2000

Product: Refrigerator

Production Capacity: 2300-2800 per day

Workforce: 1000-1200

Trade Union: A.G.K.U. (Aurangabad General

Kamgar Union)

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Manufactures: Brands:-

Videocon,Electrolux,Samsui,

Kenstar,Kelvinator,Allwyn,

York and Toshiba.

Competitors: LG, Whirlpool, Godrej, Samsung etc

Market Shares: Data Collected from ORG report

Logo Changed

Videocon Group Changed Logo

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Videocon Group, the Rs 5,000-crore conglomerate, has embraced a

new brand identity. The brand has shed its solid steel 'V' for a more

fluid, lava like 'V', coupled

With a new proposition Exprience Change prior to this , the brand

has banked on other propositions, such as 'Technology for health and

pleasure', 'Bring Home the Leader', 'New Improved Life', 'The Indian

Multinational', 'Whatever role life gives you, play it big', as well as the

most recent one, 'Eco Logic for sustainable life'.

The company unveiled its new tagline recently, at an event promoting

the 2009 chapter of the IIFA awards. The new logo was unveiled in

San Francisco, by the Videocon brand ambassador Shah Rukh Khan,

From static to flexible conceived by Interbrand, Singapore, the 'V' in

the new logo is representative of the new identity of the brand an

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identity that is fresh, dynamic, and has been provided a life of its own.

The new 'V' is composed of two animated green, lava-like shapes

Called Chouw and Mouw both of which have distinct identities.

Chouw and Mouw are 'live' characters, and will be used through a

series of short videos to tell simple stories, each depicting a positive

dimension of Videocon's new tagline, 'Experience Change'.

Both have certain personality traits, based on their physical attributes.

The bigger one, Chouw, is slow but earnest; strong and silent; he is

patient, good natured, kind, and maybe a little romantic too. The

smaller one, Mouw, is quick witted, energetic bordering on restless,

curious, and funny.

Physically, they can coerce their bodies into rudimentary shapes that

help them to get on with tasks at hand. The colour palette has been

chosen to reflect the philosophy of the Videocon Group, that is, the

green colour is symbolic of the company's ecology drive.

Prasoon Joshi, executive chairman, McCann Erickson India, and

regional executive creative director, Asia Pacific, McCann Erickson,

says, "The task at hand was challenging, keeping in mind the brand

equity and recall Videocon already enjoys. So, keeping in mind that

the brand was getting into new age categories, it was decided to get

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rid of the static nature of the brand and getting it to move on. Hence,

the new identity will bring energy into the brand."

Joshi, along with Vineet Mahajan, senior creative director, led the

team from T.A.G., McCann Worldgroup's second agency, which was

recently handed over the duties for the brand.

As far as the characters are concerned, Joshi maintains that they will

help to create buzz and visibility around the transformation and

establish the new logo in the consumer's mind effectively.

What prompted the change?

The brand, which has been in existence for more than two decades,

has managed a fair share in the entry/middle product segment. It is

perceived as a brand for the Indian middle class -- no frills, no

glamour, simple, reliable and hassle-free.

However, in the high-end products segment, Videocon is way behind

Samsung and LG. For example, it does well in the conventional CTV

category but not in the LCD category. Again, while the window air-

conditioner category is doing well, not much is happening for the

brand in the split air-conditioner category.

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With the present generation of consumers moving fast towards the

premium segment, even for their first buys, the brand is not being

seen as the preferred one. As a result, it is not able to cash in on the

high growing segment, which is the premium category of products.

This prompted Videocon to opt for a change. It has decided to focus

on the premium segment and would now diversify into other related

high-growth categories with the launch of its mobile services,

handsets business and IDTV/D2H (in-built set-top box with single

remote). Videocon expects to double its turnover in the next couple of

years, and a large part of the increase is expected to come from these

high-growth segments.

The brand will also be positioned to make a connect with the hearts

and minds of young-at-heart consumers. Adds, K R Kim, vice-

chairman and CEO, Videocon Group, in a communiqu, "The rationale

behind Videocon's brand evolution comes from our constant

endeavour to listen and respond to the changing market dynamics in

India and overseas."

Executing the change

The re-branding comes after a major review of the brand's advertising

and media planning and buying duties. The group had put up the

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account, estimated to be in the region of Rs 200 crore, for a pitch. For

the media duties, it appointed ZenithOptimedia.

The creative duties for its consumer electronics and appliances

business went to T.A.G. Videocon's five group brands -- Sansui,

Electrolux, Akai, Hyundai and Kelvinator -- as well as Kenstar, were

awarded to Saatchi & Saatchi. Other than that, among the brand's

new verticals, its DTH venture, D2H+, is with Publicis Ambience; while

the telecom venture, Datacom Solutions, is with T.A.G.

To communicate the change in identity, the brand will engage in

strong marketing initiatives and promotional campaigns across all the

media, including print, electronic, radio and various BTL and on-

ground activities, marketing collaterals and visual merchandising.

The present campaign that announces the change comprises five

TVCs, of which one is already on-air. Each commercial is a short story

of someone in need of help. Chouw and Mouw come to the rescue

and spread happiness and joy through their charm, kindness and

efforts.

Joshi adds that apart from this, digital, outdoor and sponsored events

are also being used, while the Chouw-Mouw jingle will be leveraged

for radio. The present endorser of the brand, Shah Rukh Khan might

take a backseat, while Chouw and Mouw create the buzz.

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Anybody Changing?

Demographically, the Indian consumer is getting younger -- it is

predicted that by 2010, half of the country's population will be below

the age of 25. Godrej, the 112-year-old consumer durable major

identified this in 2008, when it went for a makeover. Though its

typography and logo remained the same, a few colours were added to

the logo to make it look more vibrant. Godrej had also relied on

Interbrands for its makeover duties.

Brand consultants believe that legacy brands have to constantly

reinvent themselves to be relevant to their consumers. Their

positioning should be such that they are equally aspirational to the

next three generations, as they are to those generations that grew up

using the brand.

Jagdeep Kapoor, chairman and managing director, Samsika

Marketing Consultants says that the 'Videocon Washing Machines...'

jingle still runs at the back of his mind, while he glances through the

new campaign and logo. According to him, there can be three

situations when a brand goes for a makeover -- mergers and

acquisitions; the brand not performing well or just putting some new

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clothes on. For Videocon, he feels it could have been a fear of a

disconnect between the brand and the consumer.

"The brand has changed its positioning quite a few times. Now, with

the old Videocon jingle and the previous Shah Rukh Khan adverts,

coupled with the new green logo, I feel a bit confused; the consumer

might feel confused too. And if the consumer is confused, the brand is

refused," he remarks. However, he likes the idea of the two new

characters to spread the brand message.

However, what with Vodafone's Zoozoos and Virgin's unique

characters, the success rate of Chouw-Mouw is being doubted by

some. The characters may also end up as a 'me-too' phenomenon,

especially since all three brands are present in the telecom space.

Sudhir Sharma, independent brand consultant and designer, talks

about the logo and typography: "I found the lava-logo to be rather

weak and not very pleasant and graphic, though the typography was

done quite nicely, keeping in mind appliance brands."

According to him, the consumer will be looking more at the service

and quality, rather than the logo colour or fonts. So, given the fact that

Videocon is marching towards newer categories such as DTH and

mobiles, the change will marry well with the concept.

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However, keeping in mind the brand has existed for quite some time

now, it would be disastrous if the consumer has had any bad

experiences previously with, say, its washing machines or

conventional CTVs, which will, in turn, put him off the newer line-up of

products as well. "Unlike most PSU banks, which change their logos

and identity from outside and offer the same sloppy service inside,

Videocon has to offer the consumer something truly rewarding and

fresh," he says.

However, unlike Godrej, he feels that Videocon's transformation is

quite visible, especially with the two new characters.

History of Videocon

Videocon is an Indian multinational with interests in consumer

Electronics, Home appliance, colour picture Tube Glass ,and oil & Gas

.Videocon was founded in 1987 by Nandallal Madhavlal Dhoot . At

that time it used to manufacture Tv and Washing machine, In 1989

-90, Videocon Started manufacturing Home Entertainment System,

Electric Motors & AC. Videocon entered Refrigerators and coolers

segment in 1991. In 1995, Videocon started manufacturing Glass

shells for CRT and in 1996 it ventured into Kitchen appliances and

crude oil segment. In 1998, Videocon started manufacturing

Compressors & Compressor Motors. In the year 2000, Videocon

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took over Philips Color TV Plant. In 2005, Videocon tookover 3 plants

of Electrolux India and acquired Thomson CPT.

Today, it has evolved into a giant conglomerate with annual revenues

of over U$4.1 billion.

Business Interests of Videocon

Consumer Electronics & Home Appliances: Videocon enjoys

leadership position in consumer products like Color Televisions,

Washing Machines, Air Conditioners, Refrigerators, Microwave ovens

and numerous other home appliances. Videocon's refrigerator

manufacturing enjoys synergy with its in house compressor

manufacturing technology in Bangalore.

Display industry and its components: After the acquisition of Thomson

in 2005, Videocon has emerged as one of the largest Colour Picture

tube manufacturers in the world. It has plants in Mexico, Italy, Poland

and China and manufactures a range of high- tech products such as

slim CPT, extra slim CPT and High Definition 16:9 format CPT.

Colour Picture Tube Glass: Videocon is one of the largest CPT Glass

Manufacturers in the world. It has plants in Poland and

India.Videocon's CPT Glass manufacturing complements its Colour

Picture tube manufacturing business.

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Research & Development

The company gives utmost importance to the R & D activities, which

are carried out, at in-house R & D centre .The Company carries on

new innovations in product development, cost reduction, quality

improvement, process improvement, process controls.

1) Specific area in which R & D is carried out by the company

During the year, the company has carried out research and

Development in the following areas.

1. Home theatres-High end models and HTIB models.

2. Larger Screen Television i.e. 32 inch and 38inch.

3. True Flat Televisions.

4. Plasma Televisions.

5. Cosmetic Design and new out look to the TVs

6. Manufacturing of components for CTV,Refrigetors and Air

conditioners.

7. Efforts to reduce power consumption of all its final products.

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2) Benefits Derived as a result of the above R&D.

The company has Derived the following benefits as a result of theResearch and Development:

1. Development of new design in product and launch of various new

models.

2.Able to complete with the foreign players in the Indian Market by

cost reduction and offering innovation features and to maintain market

leadership in television under Videocon umbrella.

3. Increase in productivity.

4. Reduction in power consumption of some of the products.

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3) Future plan of action

In the coming days company is aiming to achieve development in the

following through Research and development:

1. Manufacturing of components for consumer Electronics Product.

2.Multimedia TV

3. Plasma televisions.

4. Launching of New Brands & Sub-brands under Videocon umbrella.

5. Composite Home Entertainment system with internet adaptability.

6. Work on better features, better quality & improved reliability with

reduced/low prices.

Company always attempts to use the latest and advanced technology

in production process. Keeping pace with the technological

developments, the company keeps on adding sophisticated

equipments with focus on automation to minimize manual intervention

in manufacturing process thereby ensuring quality of the final product.

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Quality Policy:

We, all Videocon Appliances Limited are committed to provide

product with inbuilt quality and reliability so as to achieve at most

customer satisfaction.

We shall

Fulfil agreed customer requirements.

Comply with applicable statutory and regulatory requirements.

Comply with our quality management system, and

Continuously improve the effectiveness of our quality

management system.

Director Sethuraman

List of Departments at Videocon Appliances

Plant Engineering Department.

PPC dept. (Production, planning &Control)

Purchase

Design and Development dept.

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Account dept.

Material dept.

Excise dept.

Quality Control dept.

Paint shop

BSR dept.(Bounded store room)

SAP dept (System Application Production)

Imports dept

HR dept (Human Resource)

Show Case dept.

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Chapter Organisation Hierarchy:-

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REF.DIVISION/ DIRECTOR (APPLIANCES)

AGM(PRODUCTION)

SR.MANAGER

DY.MANAGER

MANAGER

ASS.MANAGER

SR.MANAGER/S.R ENGINEER


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ENGINEER/EXECUTIVE

R.OFFICER/R.ENGINEER

ASST.TECHNICIAN(SUPERVISIOR)

ASSISTENT

TRAINEE(G.E.T)

WORKER


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PROJECT OVERVIEW

Introduction

Consumer Durables Sector

The durables market is replaced with opportunity, with soring

demands. The last decades has seen unemitted rise in demands in

consumer durable sector.

A number of factors have contributed to the persistent rise in demands

for consumer durables in India. The most perceptible includes the

mounting income levels of emergence of dual income families,

availability of disposable income, changing lifestyles. These factors

have lead to emergence of highly aware & demanding consumer

base.

In terms of product category the consumer durables can be stratified

into consumer electronics compromising of T.V. sets , Audio system,

VCD players & others & Appliances referred to as White Goods.

Which includes washing machines, refrigerator, microwave ovens air

conditioner.

MNCS with their superior technology & high spending on R & D have

a distinct edge over the Indian manufacturers. Domestic companies

are able to have a standing owing to a far-reaching distribution

network & a better understanding of the local market conditions.

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In the rural areas the demand is also governed by the extend of

government funding for infrastructure development, particularly with

respect to electricity.

RNCOS, an Indian based market research company, in its report

highlighted the overall contribution of Indian consumer durables

sector.

These have been stiff competition among major MNC brands like

Sony, Samsung and LG; especially in the high demand categories like

flat screen TVs and frost-free refrigerators.

Major players in consumer Durables sector

LG

Sony

Samsung

Videocon

Godrej

Haier

Hitachi

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Sanyo

Sharp

Electrolux

Kenstar

Toshiba

Kelvinator

Customer Needs Assessments:

A customer is someone who makes use of receives the products or

services of an individual or organisation. The word historically derives

from custom means habit

A customer was someone who frequented a particular shop. who

made it a habit to purchase goods there, and with whom the

shopkeeper had to maintain a relationship to keep his or her custom,

meaning expected purchases in the future.

Customer needs may be defined as the goods or services a customer

requires to achieve specific goals. Different needs are of varying

importance to the customer and other communications etc.

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Assessment is the process of documenting, usually in measurable

terms, knowledge, skills, attitude and beliefs.

Scope of the Project

It was found easy to know the perception and satisfaction of

retailers and customers about the consumer durables on

Videocon products.

To eliminate the difficulties of the retailers so as to increase the

sales volume.

By adopting new promotional strategy, market share can be

increased.

The study was limited to the opinions of households and

dealers only.

Project was carried out to access new needs of customers for

particular product.

It will reveal trend of markets and problem related to sales.

Retailer have a handsome knowledge of customers attitude towards

the product of manufacturer; therefore it is necessary to know their

views on several aspect, which would help to know the pulse of

market

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.

Objectives of the Project

Main object of the project is to match theoretical aspect with

practical experience.

Project is the vital element in curriculum of MMS.

It helps the students to be familiar with the atmosphere of the

organization.

It gives an exposure to the students to an organization.

Day-to-day business problems and obstacles in the way of

management are perceived by the student during the project.

The project is the integral part of management study which

enables the student to develop his total personality as an efficient

manager.

It helps to take up arising challenges of business work and lead

his contents in the actual field of management.

Research Methodology

Research methodology is the systematic and objective search for

analysis of information relevant to the identification and solution of any

problems in the field of business.

Research Methodology Adopted

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Research Design: Descriptive Research

Research Instrument: Structured non disguised Questionnaire.

Sampling Plan (a)

A) Sampling Technique: Non-Probability Sampling (Area & Stratified

Random Sampling)

B) Sample Universe: Aurangabad

c) Sample Population: All dealers and houses in Aurangabad.

D) Sample Frame: Middle class Household

E) Sampling Unit: Households/Dealers

F) Sampling Size: 130

Sampling Technique

Area sampling is one where the overall area to be covered in the

survey is divided into several smaller areas within which a random

sample is selected. For example, a city map can be used for area

sampling .various blocks can be identified on the map and this can

provide a suitable frame. The entire city area can be divided into these

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blocks which are then numbered and from which a random sample is

finally drawn.

In this project various residential and dealers were choose at random

for the purpose of survey.

Stratified Random Sampling is one where the population is divided

into mutually exclusive and mutually exhaustive strata or sub-groups.

It does not means that stratification does not mean absence of

randomness. All that it means is that the population is first divided into

certain strata and then a simple random sample is chosen within the

stratum of the population.

Sampling Plan (b)

a) Sampling technique: Non-probability Sampling

(Convenience Sampling)

b) Sample Universe: Aurangabad

c) Sample Population: All dealers of refrigerators in Aurangabad.

d) Sample frame: All Dealers of refrigerators in Aurangabad.

e) Sampling Unit: Dealers.

f) Sampling Size: 21

Data Analysis & Interpretation

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The crux of the research lies in the interpretation of the collected and

analyzed data. The value of the research is derived only when some

conclusion can be drawn through it. Tasteful information based on the

real facts and data is made available.

Presentation of this information in a conductive and a logical

sequence is also important to achieve the research objective in a true

sense. Thus an attempt toward the same is being made with the help

of project report.

Q. Which is the most preferred brand in refrigerators?

a) Videocon

b) LG

c) Samsung

d) Whirpool

e) Other

Option A B C D E Total

Respond 20 42 9 21 12 104

percentage 19 41 8 20 11 100

Q. What other features you found in other brand?

a) Six sense

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b) Child lock

c) Door cooling

d) Other

Option A B C d Total

Respond 26 16 28 34 104

percentage 25 15 27 33 100

Q. Do you consider star rating before purchasing electronic

product?

a) Yes b) No

Q. Do you have a refrigerator?

a) Yes b) No

Option A B Total

Respondent 101 3 104

Percentage 97 3 100

Q. Do you completely satisfied with your product?

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a) Yes b) No

Option A B Total

Respondent 101 3 104

Percentage 97 3 100

Q. Which Brand of refrigerator you sell? (For dealers)

a)Videocon

b) Whirpool

c) LG

d) Samsung

Q. Rank the aspect that you look in a refrigerator?

Rank Household Dealer

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1. Brand Brand

2. Space Space

3. Aesthetics Cost

4. Warranty Aesthetics

5. Cost Warranty

6. Power consumption Power consumption

7 Cooling time Cooling time

Q. What is your purpose to by particular refrigerator?

a) Household purpose

b) Commercial purpose

c) Office purpose

d) Other

Q. Cooling time are you planning to buy new refrigerator in near

future?

a) Yes b) No

Q. Which colour you prefer in refrigerator?

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a)Red b)Silver c)skyblue d)pink e)other

Household:-

Option a B C D E Total

Response 19 25 21 15 24 104

percentage 18 24 20 14 23 100

Q. What capacity you will prefer?

a)180lit

b)220lit

c)250lit

d)280lit.

e)above 280 lit

Option A B C D E Total

Response 15 19 21 25 24 104

percentage 14 18 20 24 23 100

Dealers:-

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Rank Capacity Door type

1 180 Single

2 280 Double door

3 Above280 Double door

Q.Which type of refrigerator will you prefer?

a)Frost free

b)Direct cooled

c)other

Q.Would you like to have designer door?

a) Yes b)No

Q. Do you check about the quality of service (post

purchase),before purchasing the refrigerator?

a) Yes b) No

Q. Do you ask about other technical details before purchasing

the product?

a) Yes b) No

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COMPANIES IN THE REFRIGERATOR MARKET

The leading companies in the market with their market share in first

half.

TOTAL MARKET FROSTFREE SEGMENT

BRAND Sales(Units) % Share

VIDEOCON 199000 12.9%

21000 12%

SAMSUNG 396000 25.7%

25000 14.3%

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LG 349000 22.7%

8000 4.6%

GODREJ 178000 11.5%

25000 13.8%

BPL 85000 5.5%

83000 7.4%

WHIRLPOOL 10000 0.7%

7000 4.0%

ELECTROLUX 8000 0.5%

8000 4.6%

OTHERS 313000 20.3%

TOTAL 1535000 100% 180000

100%

INDUSTRY ANALYSIS

(REFRIGERATOR INDUSTRY IN INDIA)

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THREAT OF ENTRY

Barriers of entry

Economies of scale:

The players like Godrej, BPL , Whirlpool, Videocon and Electrolux

have achieved economies of scale. Godrej has a capacity utilization of

75% and the highest capacity in the industry. This declines their unit

cost of every function of business and enables them to keep their

prices low. This will force the entrant to come in at a large scale and

risk strong reactions from them or come at a small scale and accept a

cost and price disadvantage.

Godrej also possesses economies of vertical integration as it

manufactures its own compressors, which constitutes a substantial

part of the manufacturing cost. The other players like BPL and

Videocon who are currently outsourcing their compressors also plan to

set up their own manufacturing units for compressors in the long run.

Product differentiation:

The companies like Godrej, BPL and Videocon, being very old players

in the Indian market enjoy high brand awareness and consumer

loyalties. These brand names are associated with trust and reliability

in the Indian market.

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The Korean players like LG and Samsung who engaged in heavy

advertising and brand promotion during the last year have also

created a niche for them in the premium segment. Their brand

awareness has grown tremendously after the recent Cricket World

Cup Tournament, during which they advertised heavily.

These create a barrier to entry by forcing the entrant to spend heavily

to overcome existing consumer loyalties and to build a brand image.

Capital Requirements:

Huge Capital requirements are posed in front of the new entrant in

terms of advertising, product development, Production facilities,

Distribution channel credit, inventories and for covering up the start-up

losses.

Access to the distribution channels:

The Indian players like Godrej, Videocon and BPL which are catering

to the mass market have a strong distribution and dealer network..

They have a presence in the urban as well as the rural areas.

Moreover these companies have established developed ties with the

channel members over the period of time, which are hard to break.

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Whirlpool has also developed a strong network of 4000 dealers in

urban and semi urban areas in a period of few years.

The South Korean Majors like Samsung and LG have a dealer

network of more than 1500, mainly in urban areas and plan to expand

it in rural and semi urban areas also.

This poses a major threat in front of the new entrant as the existing

firms already serve the channels and the new entrant will have to

persuade the channels to accept its product through high margins,

promotional allowances, better credit facilities and advertising support,

which will reduce the profits.

Cost disadvantage independent of scale

Learning or Experience curve: The old players like Godrej, BPL,

Videocon are high on the experience curve, as they know the Indian

Market well. This Experience lowers their costs in production,

marketing, and distribution and in other areas of business, thus giving

a cost disadvantage to the new entrant.

Government policy: The Government policies of levying duties on the

imported Refrigerators and refrigerator parts gives an advantage to

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the Indian Players and in a way protect them from price competition in

the market with the MNCs.

Expected retaliation: The industry as a whole faces excess capacity

and the supply exceeds demand and so the existing competitors are

expected to respond forcefully to a new entrant. The new entrant will

face competition based on the segment to which it tries to cater

If the company enters in the Direct cool segment Godrej and Whirlpool

will pose the major threat.

If the company enters in the Frost free, high capacity segment (above

300 Ltrs) it will have to face main competition from LG, Samsung, BPL

and Whirlpool.

2. INTENSITY OF RIVALRY AMONG THE EXISTING

COMPETITORS.

The companies in the Refrigerator industry of India can be divided into

four strategic groups based on the price and the perceived quality of

the products. These groups also differ in their target segments and the

strategies adopted to cater to it.

High Price Medium Price Low Price

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High

Perceived

Quality 1.PREMIUM STRATEGY

(1)LG, Samsung, 2. HIGH VALUE STRATEGY

(2) Whirlpool, BPL 3.SUPER VALUE STRATEGY

Moderate

Perceived

Quality 4.OVER CHARGE STRATEGY 5. MEDIUM VALUE

STRATEGY

(3) Godrej 6.GOOD VALUE STRATEGY

(4) Videocon

Low

Perceived

Quality 7.RIP OFF STRATEGY 8.FALSE ECONOMY

STRATEGY 9.ECONOMY STRATEGY

5) Voltas

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1. LG, Samsung: This strategic group includes the South Korean

MNCs. These are the players who are operating only in the frost-free

segment and carry a large product length. They have products only in

the above 300 Ltrs segment. These brands follow the Premium

strategy of high quality at high price. They are targeting to the upper

income as well as the higher middle class of the society with the

products that are associated with status. These companies have

shown a tremendous growth in few years.

2. BPL, Whirlpool: BPL, the market leader in the Frost-free segment

and Whirlpool of India, the subsidiary company of the US giant

Whirlpool form this group. They have frost-free models in the below

300 Ltrs capacity segments as well as the above 300 Ltrs segment.

The models in above 300 Ltrs segment cater to the replacement

market and to the higher middle class. These aim at providing high

quality at a moderate price.

The models in the below 300 Ltrs are targeted at the first time buyers

of middle class and are not high in price.

3. Godrej: These are the old brands of India, which have high brand

awareness and presence in urban as well as the rural Markets. These

are mainly serving to the Direct cool segment and have few models in

the frost-free segment. These brands are catering to the middle class

and are not very high in prices.

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4. Videocon: This is the company, which introduced Frost-free

refrigerators in India. The products are value for money products. With

the lowest prices in the market it is catering to the middle class of the

society.

5. Voltas: These companies cater to the middle and lower middle

class of buyers with their low priced ranges.

The companies in the market witness a tough competition from the

other members of its strategic group as they fight for the same chunk

of the market. As their products do not differ much in the features,

they try to differentiate their brands through copy differentiation in

advertising.

The competition intensifies as most of the companies are using the

same dealer network to distribute their products. They lure the dealers

to promote their product by different strategies on margins, incentives

and credit and payment terms.

The competition increases as all the companies have high Strategic

stakes in the Refrigerator Business. A major fraction of their revenues

come from this business and so they retaliate sharply to any move of

the competitor.

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The industry has high Exit Barriers for the members who have

invested in the manufacturing facilities in India in the form of

specialized assets.

3. PRESSURE FROM THE SUBSTITUTES

The domestic refrigerators have no substitutes and so it faces no

threats in terms of that.

4. BARGAINING POWER OF THE BUYERS

The bargaining power of the consumers is high due to the presence of

many competitive products in the market.

The refrigerator models available are not much differentiated in terms

of the features, and so the buyers can switch between the different

brands based on other criteria like Price, service, warranty, promotion

and financing schemes.

5. BARGAINING POWER OF THE SUPPLIERS.

Not very High

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DISTRIBUTION CHANNELS IN THE INDUSTRY

The Refrigerator companies in the industry use different distribution

channels to reach the customer. These are as follows:

1. In this type of channel the company uses its sales representatives

to deal with the dealers directly. The dealers place the order through

the sales representatives who visit them periodically, and the products

are delivered directly from the company.

Some companies appoint Direct Dealers who act as their Franchisee

Outlets or their Exclusive showrooms.

BPL uses this channel

2. In this channel of distribution the company appoints distributors on

the basis of District/ Population /No of Dealers to be handled by one

distributor. The area of operation and its potential is also taken into

consideration.

Some of the companies make the distributor totally responsible from

appointing the dealers to providing after sales service.

Godrej use this channel

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3. In this channel of distribution the company appoints Distributors as

well as Direct Dealers. The company appoints distributors to deal with

small dealers who order small quantities. With the dealers who have

good potential and sales the company deals directly.

Videocon and Samsung use this channel: The Korean Multinational

follow this channel where they appoint Distributors for upcountry

towns and direct dealers for big cities and major towns eg.

Ahmedabad.

4. In this channel the company appoints a C&F agent who acts on

behalf of the company. The C&F agent is totally responsible for

appointment of Distributors and Direct Dealers. He sells to both the

Distributors and the Direct Dealers at the same rates.

Strategic group mapping of industry players:

Recommendations:

Company had believed that if we provide good quality product in the

market, the demand will definitely be generated at customer side, but

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company has to follow push as well as pull strategy in order to

increase its sales.

The recommendations are as follows:

The company should improve the consumer target approach

The company should focus on after sales strategy

Data Collection

Introduction to primary data

Primary data is the finding which is collected by the way of an

interview, mail survey, observation etc. For this project data is

collected is by the way of personal interview. Interview is one of chief

means of collecting data .interview may be defined as a systematic

conversation initiated for a specific purpose and focused on certain

planned content area.

Introduction to secondary data

Secondary data is the work of findings which are already present.

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Secondary data is in the form of published and unpublished

document, reports, magazines, letters etc

In this project secondary data consisted of company data, journals

and product catalogues.

Key Findings

The most used brand is LG, followed by Videocon, Godrej,

Samsung, Whirpool in the Surveyed region.

Key competitors in refrigerator sectors are LG, Godrej,

Whirpool, Samsung etc.

Consumers need refrigerator with Star rating and which is

preferably silver in colour.

LG is leading the market with a market share of about 30%

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Segment Price Capacity

%

share

Top >20000 >300 ltrs 3%

High 15-20000 >230 ltrs 7%

Medium upto 15000 165-230 ltrs 85%

Low


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It can be seen from the pie chart that LG is leading the market with an

market share of 30%, followed by Whirpools market share of 22%.

Videocon has a market share of about 17%

Conclusion:

In order to with stand tough competition from rivals like LG, Samsung,

Whirpool and Godrej. Videocon Should Come with new model in the

most preferred segment. As customer need new and improved

refrigerators thus Videocon has to make innovative products which are

of use to the consumer. Based on the findings, new model should

have double designer door, work without stabilizer, work against

fluction in electricity and space to keep 2lit. Bottle vertically. Thus

recommended features must be incorporated in the new product.

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Limitations

While working on the proect, i came to know about the limitations of

the company. They are as follows

Small sample size due to small constraints

The project has been carried out in AURANGABAD only hence

not applicable to other cities and towns of India, as various factors

would differ

Due to nature of certain questions respondents were reluctant

to part with certain information.

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Recommendation:

Customers readily accept new things, so keep on making minor

changes and innovations in the existing and new models. The new

product must be launched in the most preferred segment i.e. double

door .New concept of designer door and water dispenser must be

incorporated in the new product.

Bibliography

www.wikipedia.org

www.videoconworld.com

www.videocon.com

Marketing Management Philip Kotler

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http://www.wikipedia.org/http://www.videoconworld.com/http://www.videocon.com/http://www.wikipedia.org/http://www.videoconworld.com/http://www.videocon.com/


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