CHAPTER 1 INTRODUCTION OF THE TOPIC

1.1 A PREVIEW TO THE INDUSTRY

TV perhaps is a most powerful media today in India. The socio economic impact of this media in a country like India is tremendous. The extensive use of the media as a powerful tool for entertainment information and education by other channel owners added impetus to this growth. After liberalization in 1991, one saw a lot of players in the Electronics market due to which increase in the Electronics that boosted the sale of home Electronics. After liberalization bought itself a dramatic change in the competitive structure of the market. Analyzing the market structure one finds that long-term dominance of Moulinex, Braun, Philips, Crompton, Inalsa, Bajaj etc. The coming of the MNCs have resulted in a decline in profit margins for the domestic players. Most of these MNCs started operations in 1992 and by 1993, had some infrastructure in place. Some of them started with fully owned subsidiaries and some went in for a tie up with domestic players. For e.g., Braun established themselves in 1999-97; Moulinex in 1992; Philips in 1994-95; Kenwood, LG, Softel, following in 1999-97; LG in 1992. The entry of these multinationals changed the market. As a first step, they started to set up distribution and service networks. Simultaneously they concentrated on increasing the visibility of their products in the shops of the dealers they appointed. They launched technologically advanced models with attractive price tags, keeping the dealers margins intact to help push the products. Indian companies that were complacent earlier, felt the heat. After some quick rethinking they launched new models at attractive prices. Despite all this the Indian companies have remained strong. The rate at which foreign brands are growing is only due to the fact of a dynamic business environment. Domestic Electronics firms are guided by objective of maximizing short run profit rather than long term growth and the firms competitive strategy is guided by product differentiation and price manipulation-Inalsas money back offer, Soften price led wars, Moulinex price
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consideration, Samsungs schemes- despite all this LG and JVC have opposed exchange offers and price led wars. But all other domestic players have overreacted and this has diluted the strategic issues of technological innovation through customer after sales service and ads. The Electronics domestic player has not understood the importance of technological innovation. The coming in of the MNCs has created a new scenario with a new market profile. The entrenched position of the Indian market leaders in Electronics Bajaj, Crompton and Black and Decker has been challenged by the MNCs such as Moulinex, Braun, JVC, LG, Kenwood and LG. The domestic players have a 24% market share. MNCs have managed to grab a 76% in a very short span. Earlier this was 19:6. The market leaders currently in the Electronics industry are Bajaj and Crompton with 11% and 13% share respectively in 2009-2010. Earlier till 2000-2001 these two leaders had shares of 44% and 54% respectively. Even today, Bajaj is considered to be the market leader. In this research report I am considering the comparison of different competitive brand with LG. I will also see which schemes are preferred by the customer(cash discount, installment schemes, exchange offer, free

gift).another thing is that I will see recall for different product of LG. Major Players Domestic Crompton, Bajaj, Philips, Black and Decker. International LG,Kenwood,Braun, Moulinex, Inalsa, JVC

1.2 Strategy of LG
LG electronics is a Frances multinational, entering the Indian market meant establishing itself in a different market altogether with varied culture and consumer tastes and preferences. Also that so many multinationals are sweeping into the country, it is evident that each and every company has a cutting edge over another. These global corporations are deviating from their international methodologies and improvising their strategies for local markets. LGs localization of strategy covers the following areas:

Entry Strategy: It is always better to establish as fully owned subsidiaries.

It is considered better if the company has a local partner but, since LGs earlier two attempts had already failed, it decided to do it all alone this time. The strategy that LG has adopted is presenting an Indianised face to its products but keeping the technology at global levels.

Operations: LG opted for starting its own manufacturing facility at Greater

Noida. The 20 month schedule to commission its manufacturing plant was compressed to 10 months. The company decided to go in for a green field project rather than acquisitions or mergers. (For all products except refrigerators).

Products: LG decided to go in for Product Adaptation Strategy. Globally

LG does not operate in the direct cool refrigerator, semi automatic Citrus Juicer and 21 inch Home Electronics'. But the company had to develop these products for the Indian market because these areas constitute a major bulk of buys for the Indian consumer. Also LG launched, sampoorna, India's first TV with a devangiri script on screen display on the 50th anniversary of Indian independence. LGs strategy of localizing its products to suit Indian tastes added to its strength.

Segmentation: The Company decided to enter the high end middle-class

onward segment in the initial stages, since most of the Indian brands were targeting the low and middle end customers. In the past 3 years due to LGs distinct strategy it has carved a niche for itself in a crowded segment of 20 manufacturers.
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Brand: The company launched its products in country with LG, the global
leader . It did not opt for any established brands in the country to be associated with it.

Leadership: At LG electronics, keeping the localized strategy in mind, an

Indian heads the strategic areas such as sales and marketing. Generally it happens that the senior management is deprived of Indians in a transnational but LG did to want to follow this path, it wanted that the marketing division be headed by an Indian because he would be versed of the Indian market and cultures. Ultimately it is this, which determined whether the company wants to make profits or obtain a market share. LG definitely wants to be the leader in the home Electronics industry. Seeing the progress that the company has made in the past 3 years, it has revised its plans for becoming the number one home Electronics company to the year 2009 from 2011. The company even plans to break even this year. By the year 2012 its turnover in India will comprise nearly 2 per cent of its global turnover. This is significant for a multinational that has been in the market for just two years. Before launching itself in the market in 2008, it carried out an extensive research study to understand consumer motivations to create magnetic products, price them strategically, position them sharply and keep making the magnetism more potent. Having understood the finer differences in consumer motivations, it opted for sharp arrow reason to buy differentiation over the blanket all-approach (category wise) taken by most of the other players.

CHAPTER 2 REVIEW OF LITRATURE

Once the problem is formulated, the researcher has to undertake an extensive literature survey related to problem. The literature survey undertaken here includes books and different websites from the internet. The research project was to know the Customer preferences and customer satisfaction with regard to specific brands (LG, BPL and VIDEOCON) y Nair Suja. R. - The success of the firm will be determined by how effective it has been making their marketing strategy and prepare a unique marketing strategy for each customers group by offering products and services to suit his/her needs..

y Gupta.C .B and Dr. Nair. N.Rajan

customer wants.

- A business is based on

understanding the customer and providing the kind of products that the

y Mamoria C.B. and Mamoria Satish - While deciding about marketing

strategy it is always better to establish as fully owned subsidiaries. It is considered better if the company has a local partner y Schiffman. G. Leon and kanuk lazare Leslie - Study of the customer behaviour is the study of how individuals make decisions to spend their available resources (Time, Money and Efforts) on consumption related items. It includes the study what they buy, whey they buy it, when they buy it, where they buy it, how often they buy it and how often they use it. The primary purpose for the study consumer behaviour as apart of marketing curriculum is to understand how and how customers make their purchase decisions. There insights enable marketers to design more effective marketing strategies. y Bennett Peter.D. And Kassarjian Haroldh - A great deal of research activity in marketing is design to shed light on the marketing strategy.. y Kothari C.R. For data analysis different statistical techniques are being used such as scaling techniques, correlation, hypothesis testing.

CHAPTER 3: RESEARCH METHODOLOGY

3.1 Data Collection
Information regarding the Consumer Home Electronics, organisation, Marketing Strategies, Human Resource Management will obtained through: (a) Primary Sources (b) Secondary Sources Officers of the following departments will approached to obtain information about the concerned subject. y y Marketing Human Resource Management Primary Sources: Questionnaire, Interview and Discussions with the Senior Marketing Executives of the Companies to get relevant information. Secondary Sources (i) (ii) Internet Libraries

(iii) Articles (iv) Company brochures, literature and pamphlets. Conclusions and recommendations have been thereby given. Thus in my opinion, this was the best method, that could have been used which included the use of both the primary and secondary sources since only the secondary or the primary sources could not have provided such an in-depth and detailed information.

3.2 Sample Design

A sample design is a definite plan for obtaining a sample from a given population. It refers to the technique or method the researcher would adopt in selecting items for the sample. Sample design may as well lay down the number of items to be included in the sample i.e. the size of sample. Sample
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design is determined before data are collected. There are many sample designs from which a researcher can choose. Some designs are relatively more precise and easier to apply than other. The research report will be based on the following two sampling designs.

1. Judgment Sampling;- The selection of the sample is exclusively depend on the

judgment of the investigator. Investigator exercises his judgment in the course and includes those items in the sampling which he thinks are most typical of the universe with regard to the characteristics under study.

2. Convenience sampling: - In this type of sampling, the choice of the sampling is

left completely to the convenience of the investigator. The investigator obtains his sample according to his convenience.

3.3 Sample Size:

The sample size is 100.

3.4 Objectives of Study

y To identify and analyze the position in the consumer durable industry of LG Electronics India. y y y y y Analyzing the Marketing Strategies of the above company. Understand the Competition faced by LG in industry. To study the market position of LG in industry. To frame the old & new products of LG. Find out the ways for improving of the services to attain level of customer satisfaction.

3.5 Significance of the study

Considering the wide variety and availability of products in the category of home Electronics as a industry only the five following products have been considered for study: Juice Extractor, Sandwich Toaster, Popup Toaster, Hand Mixer, Stick Blender, Hair Dryer, Jug Kettle, Steam Iron, Dry Iron, Heat Convector, Juicer Mixer Grinder, Mixer Grinder, O.T.G., Light Weight Automatic Iron. LG being a company having its operations in diversified areas, only LG electronics is a part of this study.