pricing strategy project videocon

8/10/2019 Pricing strategy Project videocon

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JAYPEE BUSINESS SCHOOL

NOIDA

STRUCTURE OF THE PRICING PROJECT REPORT

SUBMITTED TO: SUBMITTED BY:

Dr. nripendra singh Gaurav Singh Rana (13609071)


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Introduction to the company

Videocon is the very popular and very reliable company in consumer durable sector. It was

established in 1987 by late Mr. Nandlal madhavlal dhoot. In those time it entered in the market

with color and B/W Televisions and Washing Machines. The year 1989-1990 saw the advent of

Home Entertainment Systems, Electric Motors and AC. Refrigerators and Coolers by Videocon

came in the year 1991. In 1995 Videocon entered into the manufacturing of Glass Shells for CRT

and in 1996 came with Kitchen Appliances and Crude Oil. In 1998 Videocon ventured into

Compressors and Compressor Motors. It took over Philips Color TV plant in 2000 and 3 plants

of Electrolux India in 2005. In the same year Videocon acquired Thompson CPT. We can get

compete information by going through company's profile.

COMPANY HISTORY


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Group Profile


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Values & Philosophy

Shri Nandlal Madhavlal Dhoot, the founder of the Videocon Group, completed his education in

Ahmednagar and Pune. He was a successful sugarcane and cotton cultivator. As a next logical

step to vertical integration, he boldly took upon an entrepreneurial venture by importing

machinery from Europe to set up the Gangapur Sakhar Karkhana (Sugar Mill) in 1955. Those

were the times when the village did not even have electricity. Thus was unleashed an Industrial

Revolution.

The die was cast. Over the years, Nandlalji's path-breaking attitude found expression in a myriad

ways, earning him the well-deserved reputation of the pioneer of industrial activity in

Marathwada India.

In early 80's Nandlalji initiated his three sons - Venugopal, Rajkumar and Pradeep into business.

Through a technical tie up with Toshiba Corporation of Japan, he launched India's first world-

class color Television: Videocon. Today, Videocon is household name across the nation- India'sNo. 1 brand of Consumer Electronics & Home Appliances, trusted by over 50 million people to

improve their quality of life.


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Vision & Mission

Videocons mission: a reflection of continuity and change

Videocons mission expression has been crafted to envelope both extant and emerging

realities:

To delight and deliver beyond expectation through ingenious strategy, intrepid

entrepreneurship, improved technology, innovative products, insightful marketing and inspired

thinking about the future.

A breakdown of the statement above reveals a means and end approach, where the end is

articulated at the beginning with the means linked to it.

To delight and deliver beyond expectation: the end

This segment not only underlines the importance of the ultimate goal - customer satisfaction

(delight) and ultimate target - the customer, but also of intermediate processes and principals,

which have contributed to building a robust, dependable Videocon value chain (deliver). As a

result of its focus on developing loyal customers and reliable associates, Videocon is able to

exceed expectations.

through ingenious strategy: the means

In the cutthroat world of today, it is only by taking recourse to advance planning and strategy

that a business can hope to survive. Although textbook strategy has its uses, reproducing it in

verbatim for the real world would be foolish because of the absence of textbook conditions.

Thus, there is a need for a bounded rationality, a spontaneity and improvisation that is flexible

enough for scenarios both imaginable and unimaginable. Videocons ingenious manoeuvres are

actually flexi-strategy that abstracts from shifting ground conditions and decides game-plans, or

sometimes changes the rules of the game.


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intrepid entrepreneurship: the means

An enterprise with the odds stacked against it makes great business sense. This is because higher

the obstacles, lower the number of players likely to be active in that field - thus, fetching

extraordinary returns. The only requirement is a bold and confident attitude willing to brave the

odds. Videocons foray into oil and gas is a bold and intrepid endeavour that arises from

immense faith on the surefooted competence of the companys in-house managerial talent.

improved technology: the means

Technology is no more a premium input; it has become the bare minimum in recent years. Rapid

advances have only fuelled this phenomenon. Videocon is extremely vigilant in shunting out

dated technology and replacing it with the best-in-class offers of the times.

innovative products: the means

Product development, innovation and customisation are the tools Videocon uses to stay ahead of

the competition. This is because a continuous stream of innovative products excites the market

and enhances brand recall. A strategy that Videocon banks on a lot, especially on the domestic

front.

insightful marketing: the means

The market share battle scene has long shifted from technology and processes to the psyche of

the customer. This means that those with deeper insights into the elusive mind of the buyer are

likely to dominate. Videocon is reinforcing marketing strengths to read better the pulse of the

market and help create products that map perfectly into customer preferences.

inspired thinking about the future.: the means

The future is unpredictable, but not doing anything about it is fraught with grave risk. Videocon

extrapolates future trends on the basis of current changes in technology and preferences as well

as sheer gut feel. Fine-tuned business instincts are worth their weight in gold, lots of it.


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CEO Profile

Personal Profile

Name Venugopal Nandlal Dhoot

Address - Office Videocon Industries Ltd.

Fort House, 2nd Floor

221, Dr. D. N. Road

Mumbai 400 001

Tel: 091-22-66113500

Fax: 091-22-66551985

[email protected]

Marital statusMarried to Rama, having one son

& one daughter

Date of birth 30.09.1951

Qualifications B.E. (Electricals), FIE.

Schooling at Firodiya High

School, Ahmednagar

College Pune Engineering

College, Pune

Hobbies/InterestFlute recital & discourse on

Bhagwad-Gita

Present PositionChairman & Managing Director

Videocon Group

President

The Associated Chambers of

Commerce and Industry of India

(ASSOCHAM)

Other Achievements a) President Electronic

Industries Association of

Marathwada

b) Member of Advisory

Committee of "Poona University

Information Employment &

Guidance.c) Adviser to Govt. of Orissa for

Industrial Development of Orissa

d) Younger brother Shri

Rajkumar Dhoot Member of

Parliament


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Board Of Directors

Mr. Venugopal N Dhoot

Mr. Pradeepkumar N Dhoot

Mr. K C Srivastava

Mr. Kuldeep Kumar Drabu

Mr. Satyapal Talwar

Mr. S Padmanabhan

Maj. Gen. S C N Jatar

Mr. Arun L Bongirwar

Mr. Didier Trutt (Nominee - Thomson S.A)

Mr. Johan G Fant (Nominee - AB Electrolux (Publ) )

Mr. B Ravindranath (Nominee - IDBI Limited)

Mr. Ajay Saraf (Nominee - ICICI Bank Limited)


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R&D

The company gives utmost importance to the R & D activities, which are carried out, at in-house

R & D center. The company carries on new innovations in product development, cost reduction,

quality improvement, process implementations, process controls.

1) Specific areas 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.

Home theaters - High-end models and HTIB Models.

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

True Flat Televisions

Plasma Televisions

Cosmetic design and new out look to the TVs

Manufacturing of components for CTV, Refrigerators and Air conditioners.

Efforts to reduce power consumption of all its final products.

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

The company has derived the following benefits as a result of the Research and Development:

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

Able to compete with the foreign players in the Indian Markets by cost reductions and

offering innovation features and to maintain market leadership in Television under

Videocon umbrella.

Increase in Productivity.

Reduction in power consumption of some of the products.

3) Future Plans of action

In the coming days company is aiming to achieve development in the following areas through

Research & Development:


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Manufacturing of components for consumer Electronics Products.

Multimedia TV.

Plasma Televisions.

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

Composite Home Entertainment system with internet adaptability.

To work on better features, better quality & improved reliability with reduced/low prices.

Your 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 the manufacturing

process thereby ensuring quality of the final products.

Market Share and Growth Rate of Videocon

Videocon Industries Ltd

Videocon holds 25% market share in the consumer goods market in India. It is oneof the largest

CPT manufacturers globally, with operations in India, Mexico, and Italy

Videocon, founded in 1985, is today one of the largest corporate groups in India. It is now

venturing into power and telecom. It is one of the largest manufacturers of Colour Picture Tube(CPT)globally. It has close to 25% market share in home appliances segment in India and aims

to double this business in next five years. Apart from its core businesses, the company isaiming

to grow its power and telecom (handset and services) businesses aggressively through large scale

investments.


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Figure 1: Market Share (%) for FY14

Videocon Industries is primarily engaged in two core businesses

Manufacturing, assembly, marketing and distribution of consumer electronic products

& home appliances

Consumer Electronics, Home Appliances & Compressor manufacturing: Products

include home entertainment systems,microwave ovens, Colour Picture Tube (CPT) &

liquid crystal display (LCD) televisions, refrigerators, washing machines,

airconditioners, small appliances, glass shells, compressors / motors and other

components

The Company has Research & Development centres located in China, India and Japan

Display industry and its components: Manufactures colour picture tubes at its

facilities in Italy, Poland and China

Colour Picture Tube (CPT) Glass: Operates manufacturing facilities in India and

Poland


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Profit Revenue Employees

$5.2 billion $12 million 9000

Air conditioner:-


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Pricing

AC 1.5 ton 1.0

Split AC 37490-36990 32490-31990

Window AC 28490-27490 NA

Pricing Details

1.5 Ton Window AC

Vitamin C Filter

Ag+ Silver Ion Filter

Blue Fin Evaporator

Auto Clean

MRP Rs 28,990/-*


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1.5 Ton Split AC

Multi Point Cooling System(MPCS)

Vitamin C Filter

Active Carbon Filter

Ag+ silver ion Filter

Catechin filter

Gold Fin Evaporator

Auto Clean

MRP Rs 37,490/-*


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Various brands which are takeover by Videocon

SansuiSansui is very famous in color TVs and DVD player etc. it has very good share in

urban and rural market.

ElectroluxElectrolux is also well known brand in refrigerators.

Akai akai has a very huge market share in rural market. Because its price is very low and

quality is very good.

Kelvinatorkelvinator is also very popular in home appliances and other equipments.

KenstarKenstar is one of the major brands in coolers and it is very good image in market.

DISTRIBUTION CHANNELS

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

showroom.


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Achievements of Videocon

Mr. P.N.Dhoot, President of Videocon Group, awarded "MAN OF ELECTRONICS" 2005.

CNBC AWAAZ has awarded Videocon as India's most preferred Washing Machine Brand

Videocon takes over Electrolux India.

Videocon group, through offshore entity, has acquired the French conglomerate, Thomson's

worldwide Color TV Picture Tube manufacturing units.

Chairman of Videocon group, Mr. Venugopal Dhoot honored with the Marathwada Bhushan


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Videocon emerged once again as India's most Trusted Consumer Electronics & Home

Appliances Brand

SWOT ANALYSIS

The SWOT is a strategic planning tool to evaluate Strength(S) Weakness(W) Opportunities(O) &

Threats(T) involved in a project, in a business venture or in any other situation requiring a

decision. The SWOT analysis is to explained with help of following diagram

Strengths:

1. Technological skills

2. Leading Brands

3. Distribution Channels

4. Customer Loyalty/ Relationships

5. Production Qualtiy

6. Scale

7.

Management

Weaknesses:

1. Absence of important skills

2. Weak brands

3. Poor access to distribution

4.

Low customer retention

5. Unreliable product/ service

6. Sub-scale

7. Management


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Opportunities:

1. Changing customer tastes

2.

Technological Advances3. Change in government politics

4. Low personal taxes

5. Change in population age

6. New distribution channel

Threats:

1. Changing customer base

2. Closing of geographic markets

3. Technological advances

4. Changes in government politics

5. Tax increases

6.

Change in population age

New distribution channels

Value Creation

1. We value our alliances and partnershipso Strategic focus toward value creationo We value and understand partnerships and therefore initiate and build our

business models to match that of yours2. Business phasing aligned to meet your big aspirations

o We prioritise on product phasing to meet your business requirementso We collaboratively work towards GI portfolio transitioning and consolidation

3. Innovation and Technologyo Policy issuance @ POS, online policy sales/renewals, and claims servicingo Real-time management of information (MIS) by channels/businesses

4. Infrastructure and Distribution support


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o Relevant mapping to support branch-based saleso Leverage on new channels for distribution, like tele-marketing and web-based

channels5. Make KAM work

o We aim to demonstrate the effectiveness of seamless channel and enhance your

experience with timely claims and customer service, as well as faster turnaroundtimes6. Customer centric propositions

o We have an exhaustive product portfolioo Pre-underwritten personal line products like multi-year plans, combo and floaters

are also offered

7. Co-developed marketing plan for channels/businesseso Our marketing plan/calendar is designed to match each business line to support

sales initiatives. This will be done through marketing collaterals, sales spots,contests and incentives and by investing into respective channels to drive growth.

CONCLUSION

From above Literature review and findings we can say that Videocon needs to redesign its

marketing strategies and improve its after sales services in order to make a success in India.

However if Videocon improves the services, then there are quite good chances of a grand success

as Indian air conditioner market is growing very fast. So Videocon has two options:

1. Improve the marketing strategies i.e. advertising, promotions etc. This could certainly

help Videocon to penetrate the tough Indian market and to keep the market share entact.

2. Improve after sales service of the Air conditioner.

Finally we can conclude that the success (or Sales) of Videocon AC is dependent on after salesservice. Indian customers wont buy it just because of its brand name as quality is also needed

for the expected value of money and satisfaction.

In other words we can conclude that success of Videocon AC is more dependent on its product

quality and after sales service than its price.


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Suggestions

After studying the various parameters of Videocon AC, we have found out that the sales of the

product is decreasing because of inferior after sales services.

We recommend the following:-

1) Improve after Sales ServiceIt has been found out that customers find the after sales

services of other ACs better than their Videocon brand.So, improvement in after sales service

can help in increasing sales.

2) Improve the marketing strategies i.e. advertising, promotion etc. This will surely help

Videocon to penetrate the tough Indian market and to keep the market share intact.

3) Attractive schemes must be launched by company in order to attract lower middle class.

4) Increase the number of Engineers in after sales Service department.

5) More promotional campaigns must be started.

6) Number of call centre should be increased.


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BIBLIOGRAPHY

1)www.videoconworld.com

2)www.google.co.in

3) C.R. Kothari, Research Methodology

4) Philip Kotler, Marketing Management
http://www.videoconworld.com/http://www.videoconworld.com/http://www.videoconworld.com/http://www.google.co.in/http://www.google.co.in/http://www.google.co.in/http://www.google.co.in/http://www.videoconworld.com/

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