Director – Marketing | 01 Mar 2004
In a manner we are in the entertainment business. When we entered the market, we were aware of the fact that two things that drive Indian viewers are movies and cricket. Everything else from politics to any other interest is a mere add on. This is a fact we leveraged to our brand’s positioning and it is paying off.
In the colour TV segment, Sansui as a brand always commanded a certain position. But of late, the brand is getting more aggressive in its approach towards the market and to the consumers. Apart from taking initiatives like launching sub brands to penetrate the rural market, Sansui has also accentuated its communication strategies to increase its claim on the consumer mind share.
In a conversation with Noor Fathima Warsia, Sansui’s Director – Marketing Anil Khera talks about the recent activities that the brand indulged in and the objectives behind each of these.
Q. To begin with, how would you describe you relation with Videocon - as a partner being in the same group or as a competitor trying to vie consumers in the same category?
Technically, Videocon is one of Sansui’s partners in India. As you know, apart from us, they have their interest in Akai and Toshiba as well. All of us operate, position and market ourselves at completely different platforms. Sansui focuses on CTV, video and DVD players. Currently, we hold a 10 per cent market share, which makes us one of the leading brands in the group. So, in that respect we belong to the same group.
But courtesy this difference in platforms and positioning, in the market, we compete with each other and other brands for consumer mind share.
Q. You mention that your current focus is on CTVs and players but doesn’t your foray in refrigerators in October-November last year, then affect your focus.
We have ventured yes, but now it is test-marketing stage. We have not really got in the segment. Once we get into that segment, its not going to be only refrigerator, it’s going to be any product that is compressor driven like air conditioners, so we will get into the segment completely, whenever we do. We are just trying the direct cool segment with Sansui branding presently.
Q. How is the market response so far?
The market response as yet is very encouraging. Even the dealer response is a good one. What happens with this kind of product expansion is that, the dependability of the dealer increases on the brand. So where he promotes Sansui TV, he will also simultaneously promote a fridge or any other product also. In effect, the strategy helps strengthen dealer – manufacturer relation.
Q. Even your strategy to outsource is an interesting one. As a matter of fact, you are outsourcing functions like logistics to original equipments for CTVs. What is the reason behind this move?
Outsourcing is a worldwide trend and India is catching up with it now. Earlier marketers believed it was beneficial to manufacture everything. So they got into a backward integration trend and produced everything from screws to packaging boxes that a product consumes. Later they realised that this added to production cost. And when you get into volume game, this becomes a problem. You can have various mismatches. For example, if you have a unit that is geared to produce certain volumes of an input, say transformer, which is unique to your final product it makes very difficult to induce a change. If your factory decides to change the specifications of the final product, this transformer will be a mismatch and you are stuck with it. In the case of outsourcing, you can comfortably take any decisions of change. Today if you decide you want to change your circuitry, you have to simply give the supplier a month’s notice. Another benefit here is in quality. In outsourcing, it is the speciality of one supplier. When you make everything, for you it is a sideline product. It will never give the quality that a specialist of that unit can deliver at affordable pricing. Take the example of Metro. The function of this wholesale store is such that all the five star hotels in Bangalore can close down their purchase departments. All they need is one man, who draws out a list and Metro supplies everything, not to mention at better prices than what the purchase department could have given.
Q. Does this hold true in the case of logistics as well?
Yes, of course. Indeed in logistics, outsourcing gives more convenience. For our logistics, we are in touch with Geo logistics. They are taking care of our entire movement of the materials that is picking from the factory, delivering to the state warehouse and then, from there to dealer shops. They deliver the goods and give the acknowledgment. The best part is that you can monitor every movement online. So you literally know how your goods are moving, as it crosses the state and city boundaries.
They are specialists in the field and this we cannot do. It also saves us from any labour problem. We used them for our Bajaj assignment and the execution was perfect. Now we are working with ASL as well in two states. Of course, when it comes to these services also, some are strong in some areas. So while it would be better to tie up with one, for a perfect execution of an assignment, a zone wise split proves to be a better solution.
Right now we are only in the phase where these logistics are employed for taking finished goods to dealers. But we are looking at the whole chain now. That’s picking up material from our foreign suppliers’ factory, converting them into finished good, finished goods taken to our branches and from there to our dealers.
Q. More on the branding side now, lets talk about your association with various TV properties. How do Sansui stand to gain from these?
Well, if you see, in a manner we are in the entertainment business in any case. When we entered the market, we were very aware of the fact that the two things that drive Indian viewers are movies and cricket. Everything else from politics to any other interest is a mere add on. This is a fact we leveraged to our brand’s positioning.
We have been doing the Sansui Viewer’s Choice for seven years now. It has always proved to be a success and even this time it was no different. This is one property that we initiated to cash on the audience’s interest in Indian cinema. Then Antakshari has in any case been a very popular programme for years now. So, when we got this opportunity with Zee, we took it up as well.
Of course, even here there are some attempts that don’t work. For instance we looked at some branding with Sony’s Lehrein but that didn’t work out. Now we are looking at some branded programmes on regional channels as well.
Q. Is the idea to increase your awareness in the regional markets?
Regional and rural markets. There have been 9 crore TV units in India sold in totality, ever since TVs are sold in this country. Of this, 3.5 crores are CTV and in the rest, there is a rapid increase towards colour TV. For a population of 100 crore, this is not a very bad number. But the penetration level has to still increase to a 25 per cent to 30 per cent. There is that kind of scope and these initiatives will help us in making our presence stronger.
Q. Your sub brand Dhanpurna is one such initiative. What is the objective here?
We launched this sub brand to penetrate better in the rural markets. The product offers basic qualities of a modern TV set minus the frills. It is very aptly priced too. We released it in phases depending on geographical divides. 26 per cent of the total country’s market comes from the rural areas. By rural, I strictly mean towns with population below 50,000. In comparison, seven metros contribute 24 per cent. This makes the rural market a stronger one. So there was the need to introduce this sub brand to get to this market and it is paying off.
Rural market in India is a difficult one because it is spread across unlike the metros, which are convenient as they are concentrated. Penetration here is difficult but this is the area from where growth is coming in so it is very important to penetrate.
Q. Rural market in India is big, but for a product like colour TV one might think that the urban market is a stronger one?
That was the case but the picture is changing. One reason for this kind of rural contribution is because you have the various regional programmes available in all languages there which people in rural areas understand and loyally watch. Then, there are a lot of FTAs available to them, so TVs are a very strong source of entertainment. People want TVs, the question is of making it available to them in a price that they can afford and at the same time communicate to them that it is a quality product.
Q. Please tell us more on your communication strategy… how have you changed it?
There has been an evolution definitely. Earlier our market slogan was ‘Sansui - Better than the Best’. But there want really a connect that was coming from that. Then we thought on the lines that Sansui is a Japan based company and that itself is an asset that people should be informed about. So we changed our slogan to ‘Sansui - Born in Japan, entertaining the world’. There was a need for this association. It is different from others’ positioning. This is integrated in our communication now and it is paying off. There are so many products available in the market apart from the regular names that the consumer has a very wide range of choice. So you have to convince the consumer that yours is a standard product.
Q. With the financial year almost coming to an end, how would you say things fared for Sansui?
This year has turned to be a very good one for us. It began with cricket. The country’s economic growth supported the segment completely. Since last July, the market was upbeat. We had a good monsoon and a better Diwali. In the Diwali month alone, our industry sold 1.2 million CTV units. A record by itself as this industry has never registered this kind of a figure. So yes, the year is ending on a very good note and new objectives are chalked out already.
Q. And what are these objectives?
Get our targeted sale of one million CTV units. Concentrate on better rural penetration and communicate to the consumers that this Japan based company, has a standing in the world but is well on its way in making its mark in every Indian village, town and city.