With the advancement in the technology the television set has also developed leaps and bounds with time. The journey which had started as black & white to color mode, then came CRT TV to plasma technology to LCD TV, LED TV, and now 3D technology is also available in the market. Though the last two types are very new in the market and are too expensive, therefore have to go a long way to gain considerable market share.
TV is the one of the most important electronic gadget which is present in almost every Indian home. Indian people are absolute TV buffs and the entrance cable and set top box the TV market has got a big boost. Be it a daily soap for housewives or Sensex news for business mans, TV has become an integral part of our life.
With a global trend of dumping the CRT TVs, India is of no exception to the trend with the market of LCD TVs growing nearly at a rate of 100% per year. According to Display Search analysis the LCD TV market of India will surpass the CRT TV market by 2012. (Ref-www.emtworldwide.com).
The major brands in Indian market are Samsung, Sony, LG, Philips, Videocon and Onida. The leader in LCD TV market in India is Samsung with 30% market share. The main competitor is Sony with 19% market share, followed by LG with 16%. (ref. – gadgetophilia.com)
This is a Korean company with its headquarters at Samsung city, Seoul. It is South Korea’s largest chaebol and the world’s largest conglomerate by revenue.it was founded in 1938. Mr. Lee Kun-hee is the Chairman and CEO), Samsung Electronics Co. Ltd. is a global leader in semiconductors, telecommunication, digital media and convergence technologies; with 2003 global sales of US$ 36.4 billion and net income of US$ 5.0 billion. It employing more than 88,000 people across 89 offices in 46 countries, the company consists of six main business units: Corporate Technology Operations, Digital Appliance Business, Digital Media Business, LCD Business, Semiconductor Business and Telecommunication Network Business.
Recognized as one of the fastest growing global brands, Samsung Electronics is the world’s largest producer of color monitors, color TVs, memory chips and TFT-LCDs.
The tag line which Samsung has given to its target customers is “Fashionista’s”. These are those consumers who love to look stylish and fashionable with everything they do. They are early adopters of new technology and love to have the latest gadget. Based upon this vision Samsung has chosen its target market as follows:
Age- One of the most important variable in choosing the segment for Samsung LCD TV is age. As the technology (Liquid Crystal Display) used by Samsung is new and expensive, thereby making their LCT TVs quite costly and thus their marker targets consumers in the age group of 30+ who have a small family and are working at a decent position with high income. They have target GEN Y and DINKS who have high appreciation for technology and style and have the buying capacity for it.
Income – As discussed above, due to the expensive technology the target market chosen is upper middle class and high income group. People having high income generally maintain a good social status and therefore always try to be updated with new and high end products. Also, according to the principle of elasticity of demand, with the increase in income the consumers move towards normal (good quality) goods. (Ref. – Fundamentals of management by Stephen r. Robbins).
Region- As the high income group people generally resides in sub urban and urban regions, the Samsung’s LCD TV market is mainly concentrating in these regions.
Lifestyle – This market targets people with luxurious lifestyle, having high social status, looking for latest technology and stylish look. Cost is generally not a concern for them but the quality is. These are the ‘Fashionista’s’. They want everything first. And that is the reason Samsung always try to be the first in introducing new products.
For family viewing, easy to keep, better quality
Upper middle class to high class families
High social status, well aware about latest technology, looking for luxury
Good income, quality oriented, good social status
Latest technology, expensive, look, size, quality
The closest competition to Samsung in LCD TV market is Sony with 19% market share (Samsung 30%). Sony is known for its technology and quality and therefore is the toughest competitor of Samsung. Sony’s targeting customers who are hardcore technology buffs, whereas Samsung’s target market is consumers who are fashion and style lovers. Sony was actually the first company which has started the LCD TVs. The strong area of Sony, where it has an advantage over other brands, is its brand image and sound technology.
The 2nd competitor in terms of market share is LG with 16% market share of LCD TVs. LG is a Korean company which was founded in the year 1958 by the name of Goldstar. Company’s has established its brand image as “Stylish design and smart technology, in products that fit our consumer’s lives.” It is having a huge variety of electronic consumer goods. LG with a strong consumer base in India in electronic goods market is constantly looking to increase its market share in LCD TV segment and therefore was the first one to launch 19′ LCD in the market to attract the middle income group. (Ref. – www.lg.com)
Videocon has also become a strong competitor of Samsung in LCD TV market. Videocon has revamped itself completely with a new logo and brand image. It had started in the year 1984 by Dhoot family. Today it has strong presence in electronic durable goods. Videocon being an Indian brand has emotional touch with Indian consumers. Its technology and a refreshing look is again gaining consumers trust. The area where it is lacking behind Samsung is its product looks and quality where it still has to improve. (Ref. – videoconworld.com)
There are various factors which customers look for before buying a product. There are tangible factors and intangible factors:
Size – The LCDs are available in different sizes. A customer look the one which best suits his physical space (home, shop, office, restaurant, etc.). Therefore the LCD TVs are available in large number of sizes varying from 19′-55′.
Price – The most important factor in deciding which TV to buy. The consumer’s psychology is to buy the best product in most affordable price and therefore, discounts, additional offers, free gifts, etc. plays a very decisive role in choosing a product. And that is why; to lure more and more customers the companies always announces some or other offers on their products.
Color- In earlier days this was not a parameter as much color options were not available only. But today a wide range of color options are present. Consumers have become very specific about the color.
Look- ‘Is it sleek or not?’ is what is in trend. The LCD should go with the interiors of the room. Therefore, the shape and size have become very important factors. And this is one the factor on which companies having fierce competition. Even brands showcase their shape as their USP. Therefore, all the LCDs present in the market are on this line only, sleek and smart. The best advantage of being sleek is the less requirement of space to keep it and ease of mobility.
Features – no. of channels, compatibility with other devices, high definition pictures, color contrast ratio are few of the things which consumer look at before buying the LCD. Few of the latest features are wireless AV link, USB compatibility, smart energy savings, inbuilt STP box, energy meter, eco vision, etc.
Brand – Today’s consumer is very brand conscious and brand loyal as well. The brand image is one of the major driving forces in deciding which LCD to buy and which to not. When it comes to purchase expensive products consumers always prefers to buy the most trusted brand. Therefore, every company tries to give best service to the customers to gain their trust and loyalty.
Occasions – Festivities in India are very important for companies as the sales of the products increases many folds during festive seasons. Occasions like Diwali, Dusshera, navratre, etc. are few of the important festivals when consumers do shopping for products like LCD TVs.
Brand loyalty – This is the factor on which every company pays high attention. Most of the time consumers go by the brand it likes the most for any particular reasons. For e.g.: a Sony brand loyal consumer, who is a technology buff, will buy only Sony LCD TV whatever the cost may be.
Word of mouth – A very popular mode of marketing which can make consumers to decide which LCD TV to buy. Consumers get easily influenced if others praise a particular product more than the other. Most Indian consumers generally take advice of many people before buying an expensive product like LCD TV and go with the majority.
SonyPerceptual map: High on Technology
High on style
High on features
High on product range
The perceptual map above is based on the technology, style, product feature and product range. Sony has concentrated more on technological aspect. Therefore, its target market is also the segment for which technology is of prime concern. It lacks on the variety part as it is not having huge range in LCDTVs as compared to Samsung and Videocon. On the other hand, Samsung, LG and Videocon have targeted customers on the basis of style and looks. LG also lacked behind in terms of product range but these three have tried to distinguish each other in terms of product features. Videocon has revamped its image to a more vibrant, young and dynamic in nature. It has introduced a huge range in LCD TV to cater to all the segment of consumers with quite competitive price range. Samsung as known for its looks and features also has huge range in LCD TVs.
Conclusion: The LCD TV market is growing leaps and bounds in India. India has become a very high potential market for LCD TVs and therefore each company is trying to make the most out of it. Presently India is ranked as the third largest television market in the global front. The competition is fierce and due to this consumers are getting finest technology and huge variety to choose from. On the manufacturer part, to increase their market share they are trying every bit to satisfy the customers by providing best technology and features at most affordable prices.
Recommendations: Due to the costly technology and high expenditure on R &D the LCD TVs are still out of reach of masses because of their price range. As a major part of our population is middle class, the companies will have to make the LCD TVs more affordable, may be in the price range of 10k-12k to make it popular among this class. Large part of the population resides in sub-urban and rural areas and has huge potential to tap off from. Therefore, the companies will have to make strategies to enter this segment.
With the entry of LED TVs and 3D TVs the rates of LCD TVs may fall, but it will hugely depend upon the success of these new entrants.
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