Sanyo-BPL, the 50:50 colour television joint venture, is taking brand BPL to the hinterland markets ,warding off a head-on collision with the chaebols who rule the urban Indian market at the moment. BPL, as a fighter brand, will play in the semi-urban and rural markets, and is expected to account for 85% of the JV's targeted volume sales during the ongoing financial year, 2006-07.
The JV hit the market earlier this year under separate brands: Sanyo and BPL. It has projected volume sales of 6.5/7 lakh units, giving it between 6-7% market share in the current financial year. “We hope to average 50,000 units annually. We expect BPL to lead the volume growth with Sanyo positioned as an aspirational brand in the urban market,” said company sources.
The domestic CTV sales during 2005-06 was estimated between 9.5 to 10 million units and it is slated to touch 11 million in the current financial year. Incidentally, the rural market now contributes nearly 45% of the CTV volume sales, which is reporting 8/9% growth annually.
The move to tap the hinterland market is based on the premise that brand BPL still enjoys better customer connect there compared to the urban segment. The exception to this approach would be Tamil Nadu and West Bengal where research shows that the brand's appeal continues to cut across the urban-rural divide. Bulk of the brand BPL's product line will fall in the sub Rs14,000 price bracket. Accordingly, the JV's advertising spend - almost 85/90% of which will be on BPL - is likely to reflect a skew towards regional media. BPL returned to air with the first commercial in many years in the last few weeks, focusing on Hindi and other vernacular channels. The brand Sanyo's advertising in the metros will be led by outdoor spends.
Meanwhile, observers expect the JV to sell about 4/5 lakh units this year.
“It should fancy a market share of around 4% with average monthly sales stabilising at about 40,000 units,” said sources. The move to take BPL to the hinterland was a strategic one, they added, as dealers in there were better placed to push a brand compared to their counterparts in the metros where the existing market leaders unleash relentless aggression.