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TV firms zoom in on corporate market

10-May-2004
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TV firms zoom in on corporate market

Philips India recently launched a colour television set it calls a Mirror TV. As the name implies, it functions both as a mirror and as a TV set. Priced between Rs 1.15 lakh and Rs 2.65 lakh for a 30-inch set, the company is betting big on the product.

Philips is here eyeing not the average retail buyer but the booming hospitality industry, where the company accounts for over a 40 per cent share of the market, and cruise liners.

LG Electronics India too is moving in a bigger way into the corporate market. It has tied with the Taj group of hotels to provide home theatre systems with plasma displays panels (PDPs) in hotel rooms.

The Korean company has also provided PDPs to the Indian railways—about 25 of them have been installed at the Chennai railway station.

After slugging it out in the business to consumer (B2C, or retail) segment, India’s colour television producers are now zooming in on the business to business (B2B, or companies and institutions) market.

TV manufacturers produced 8.5 million TV sets last year, according to the Consumer Electronics and Television Manufacturers Association (CETMA). ORG-GFK figures suggest that some 7 million colour TV sets, worth Rs 7,464 crore, were sold in the last calendar year.

Manufacturers forecast that some 8 million sets will be hawked this year. No clear figures exist on how many TV sets were sold to corporate or institutional buyers. Estimates vary from 200,000 to 450,000 sets and even more, depending on the TV manufacturer you’re talking to.

Even if you assume that 500,000 TV sets were bought by companies and institutions, that’s just about 5 per cent of total sales.

Even so, it’s a market that’s growing by an annual clip of 20 per cent. In contrast, the retail market’s growing by a more modest 8 per cent.

Indeed, TV makers report rising B2B sales graphs. Philips India, for example, clocked Rs 135 crore in sales of TV sets to companies and institutions last year. This year, it expects to rake in Rs 150 crore. At Samsung India Electronics, B2B accounts for 3-4 per cent of total sales of Rs 3,700 crore last year.

“We expect this to grow 100 per cent this year,” says Samsung India Electronics marketing director Ravinder Zutshi. “Although the margins in B2B are wafer thin, there are enormous benefits that accrue because of branding,” says P T N Charlu, general manager, B2B, at Philips India’s consumer electronics division.

TV makers attribute the rush of interest in the corporate and institutional market to the sprouting of new hotels and malls in the country and companies and banks are doing up offices.

“A lot of hotels are upgrading from the conventional basic TV models to television sets with advanced features,” notes C M Singh, head, product group, colour televisions, at LG Electronics India.

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