The rural market for colour televisions (CTVs) grew by five to seven per cent faster than the urban market in 2003. This year too, the rural market will set the ball rolling by spurring the growth rate to 20 per cent.
This will mainly be on the back of some companies reducing prices, with others moving out of top 100 cities and tapping the rural market, predict industry sources.
Companies such as Philips India Ltd have recently embarked on a major pricing strategy and reduced prices of their 14-inch (Rs 7,490 to Rs 5,690), 20-inch (Rs 9,490 to Rs 7,690) and 21-inch CTVs (Rs 10,990 to Rs Rs 8,990) with the introduction of a new sub-brand ‘Vardaan’ series, targeted at the semi-urban and rural markets.
When contacted Philips India Ltd senior general manager (consumer electronics) Suresh Sukumaran said: “At present, the lower-end segment of CTVs constitute 84 per cent of the market volumes. And by reducing prices, our ‘Vardaan’ series CTVs will be targeted at first-time buyers who are looking for a branded product at reasonable prices. This year we expect to double volumes of our CTVs (targeted at the segment) from two lakh to four lakh units.”
Philips India is planning to increase its distribution reach for small-screens from 170 to 350 distributors by the first quarter of 2004. In fact, in order to build awareness of the new Vardaan series, the company has created radio jingles, in-shop point-of-sale material and 1.5 million sq ft of wall painting.
According to Mr Sukumaran, Philips India will be investing Rs 4 crore on the new marketing initiatives. Two-thirds of the company’s business will come from the Vardaan series.
Meanwhile, Mirc Electronics Ltd vice-president (sales, marketing and service) V Chandramouli said: “In 2004, we are planning to strongly focus on availability of our CTVs and on expanding the service reach in the rural market. By March-end 2004, we will accomplish our target of expanding our number of sub-dealers in the rural market (smaller towns) from 470 to 620 through our ongoing ‘Operation Vistar’ promotional campaign.”
According to Mr Chandramouli, the company is now focusing on smaller towns leaving the top 100 cities in order to market its economy model ‘Smart’ series and ‘KY Thunder’ range of CTVs.
The ‘Smart Series’ and ‘KY Thunder’ range of CTVs targeted at the rural market will increase contribution to Mirc’s overall sales turnover from 20 to 24 per cent by the end of the next year, he added.
Thus, with the rural market for colour televisions set to grow at an even faster pace compared to the urban market, consumer durable companies have readied themselves with new strategies to tap the opportunities and spur more volumes of their CTVs. It remains to be seen whether their new strategies will bear fruit.