EXECUTIVE SUMMARY

The global economic turbulence that characterised the past few years is expected to

ease off by 2014. The Indian economy performed well even under economic duress

and conditions improved alongside a recovering global economy. India registered a

robust economic growth rate of 5% in the financial year 2012-13 and demand for

consumer appliances would continue to surge further. The steady economic growth

will continue to provide consumers with higher disposable income and benefit those

seeking to upgrade their lifestyles. A robust 400 million Indian middle class with

growing disposable incomes has been instrumental in driving demand of various

consumer electronic devices. Price pressures due to high inflation, fuel costs, a

weakening rupee and rising input prices will remain major concerns for

manufacturers.

Low household penetration (well below world average) of appliances in India will

provide opportunities for companies to expand their reach. Expansion of modern

retail and exclusive company outlets across regions is expected to increase the

penetration of Home Appliances. Appliances are expected to post strong growth

even in non-metro cities (tier two & three cities & rural areas). Other factors fuelling

double digit growth of consumer appliances in India are rise in double-income

nuclear families, easy

availability of credit, changing lifestyles, introduction of new models, and

increasing consumer awareness.

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A large number of consumer electronics and home appliances were increasingly

imported towards the end of the year 2013. Importing products into India proved to

offer good quality products, and turned out to be more economical than

manufacturing these products within the country. As such, more manufacturers opted

to continue following the import route. Better quality products were available to

consumers at lower prices as the quality offered by smaller players improved

substantially due to imports and prices not appreciating proportionally. Hence,

smaller regional manufacturers who are mostly involved in trading of products

manufactured in China are expected to provide stiff competition to their larger

national counterparts in the coming years.

However, the 2013-14 Budget had no specific proposal pertaining to the household

appliance industry. The increase in excise duty and service tax from 10% to 12%

in the Union Budget of 2012-13 had an immediate impact on end consumers across

all demographics.

There is a definite lack of proper electronics eco-system in India as almost 60-70 %

of the inputs in major appliances such as LED TV’s have to be imported. This is a

big handicap and adds to the cost of manufacturing final product. This is further

exacerbated by the FTA’s with ASEAN countries and the heavy taxation in India.

Unless the situation is corrected, it is likely that by 2020, the electronics import

may far exceed oil imports reaching USD 300 billion.

There are various short term and long term solutions which need to be looked into to

boost the eco-system of the consumer appliances in India. This is a big handicap and

2

adds to the cost of manufacturing final product. We need to take some concrete steps

today, to define a profitable path for consumer appliances eco-system in India.

3

SR NO. CONTENTS PAGE NO.

1 INTRODUCTION 6-7

2 LITERATURE REVIEW 8-11

3 VIJAY SALES 12-14

4 CROMA 15-18

5 NEED FOR RESEARCH 19-21

6 SWOT ANALYSIS OF THE CONSUMER

ELECTRONICS SECTOR IN INDIA

22

7 SWOT ANALYSIS OF THE CONSUMER HOME

APPLIANCES SECTOR IN INDIA

23

8 SALES PROMOTION 24-27

9 MANAGERIAL IMPLICATION 28

4

10 MARKETING STRATEGY 29-34

11 QUESTIONNAIRE 35-49

12 RECOMMENDATION 50-53

13 CONCLUSION 54-55

14 BIBLOGRAPHY 56

5

Chapter I

INTRODUCTION

Background

Consumer durables’ is one of the fastest growing industry segments in India. This

sector attracted significant investments even during global recession. During FY03-

FY13, the industry expanded at a healthy CAGR of 13 per cent. Urban markets

account for the major share (65 per cent) of total revenues in the consumer durables

sector in India. Rural markets are expected to grow at a compound annual growth

rate (CAGR) of 25 per cent. Also, increasing electrification of rural areas would

augment the demand. 100% FDI is allowed in the electronics hardware

manufacturing sector under the automatic route.

Since, India has been trailing behind ASEAN countries in terms of production,

quality and export of consumer appliances, performance levels of most of factors of

production such as quality manpower, capital investment, infrastructure, technology

etc., need to be enhanced through conscious policy interventions and managerial

action to boost competitiveness of the sector. In this context, an attempt has been

made to understand the productivity and competitiveness of consumer appliances

eco-system in India and recommend policy solutions to make the sector

internationally competitive. The study also attempts to identify the factors hindering

the progress of the sector and suggest measures for enhancing the competitiveness of

the sector.

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Objectives/Scope of the report

The Indian consumer durables segment can broadly be segregated into consumer

electronics (TVs, Set Top Boxes and Audio systems etc.) and consumer appliances

(also known as white goods) like Refrigerators, Washing Machines, Air

Conditioners, Microwave Ovens and Vacuum Cleaners.

The study is carried out with the following major objectives:

Understand the demand driver of Home appliance & Consumer electronics in

India

Market size and domestic production trends of some major products in the

category

To study for Croma stores & Vijay Sales, their Marketing & promotion

strategies

Conclusions and recommendations based on the study

7

Chapter II

LITERATURE REVIEW

Purpose – The purpose is to identify the factors which are considered by Customers

while deciding between opting for a national brand and a private label and how can a

company increase the sales of its private labels by working upon these factors.

Design/ Methodology/ Approach – The study is descriptive in nature. A case study

is conducted on Croma’s private labels & Vijay Sales for this purpose. The data is

collected using a structured questionnaire.

Findings – The research came out with three parameters of judgment from a

customer point of view. These are Merchandise Mix, Brand Equity and Brand

Knowledge. The research shows how a customer makes a purchase decision when

private labels come into picture. The parameters change to some extent due to a

completely different value proposition provided by the private labels as compared to

national brands.

Research limitations/ Implications – A key limitation of this study is the sampling

frame. The sampling frame is limited to a certain age group in a restricted

geographical area. The responses are collected in a limited time frame for a

particular industry Consumer durables and electronics. Future research is required in

order to test the generalization of the proposed parameters.

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Practical Implications - To boost the sales of private labels and enhance their image

in minds of the customers, it is important for the company to focus on few key areas

identified in the findings. The merchandising mix of the store should reflect a proper

mix of store brands and national brands. The brand equity of the retailer helps in

increasing the private labels sale as the retailer becomes a brand in itself emphasizing

the private labels also to be treated as a brand in the mind of the customer.

Knowledge about brand

can increase the reliability factor for customers by reducing their perceived risks

about a product. .If worked out properly these parameters can bring out substantial

improvements in the sales of private labels.

Keywords: Private labels, consumer durables and electronics, merchandising mix,

For conducting this research it was important to get an insight about the concepts of

the development of private labels, their importance, and consumer perception for

brands and store image etc. There are various factors which can influence a

customer’s purchase decision. Some of them are discussed below: A brand-image is

defined as the total sum of brand associations held in consumer memory that lead to

perceptions about the brand (Keller, 1993). These associations of brand image are

multidimensional and consist of the affective dimension or the attitudes towards the

brand and the perceived quality dimension (Keller, 1993). Consumer uses different

cues, benefits, symbolic meanings etc. to relate to a brand. The cues used by the

customers can be intrinsic or extrinsic cues.

Extrinsic cues refer to cues which are extrinsic to a product and do not have to be

experienced in order to make judgments, like the packaging, brand name, price and

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advertising. Intrinsic cues refers to the factors like taste, quality etc. which can be

judged only by experiencing. These two types of cues are also considered

responsible for building brand image. For national brands it is comparatively easier

to develop the brand image, as they spend more on marketing, packaging etc. and are

always positioned as high quality offerings.

In case of Private labels it’s more complex. Here customers do not have a strong

brand association. However, authors observed that the store image acts as an

important indicator of store brand quality (Semeijn and al., 2004). Researchers have

studied a multitude of retailer attributes that influence overall store image, e.g., the

variety and quality of products, services, and brands sold; the physical store

appearance; behavior and service quality of employees; the price levels, depth and

frequency of promotions; and so on (Burt and Carralero-Encinas, 2000; Ailawadi

and Keller, 2004; Sorrenberg and Erasmus, 2008). In case of private labels customers

tends to go more on the extrinsic cues.

Therefore, factors like packaging, display etc. have to be taken care of. Although this

will increase the cost for the retailer but he can keep saving margins by squeezing the

supply chain and then play on volumes. Also for

private labels the efficiency of a salesman to convince the customer plays a major

role. Although there is a causal relationship between the store image and the

salesman’s reliability as considered by the customer.

But then the overall strategy defined by the company will depend on other factors

also. The overall strategy and positioning of retailer will also define what a consumer

expects and what factors he/she consider for coming to a conclusion, while selecting

a brand. Here comes the role of the brand

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architecture. Esbjerg et al. (2004) adapted Aaker and Joachimsthaler (2000) brand

architecture concept to the retail setting by defining retailer brand architecture as a

retailer’s assortment of manufacturer brands, retailer brands and generic products.

The brand architecture can differ based on two

dimensions: the quality of retailer brands and visibility of retailer brands (Esbjerg et

al. 2004).

As we saw customer while deciding among the National Brands and the Store brands consider various factors. Relying on various literatures discussed above some of these factors can be identified as are store image (the trust factor), variety and quality of products, options available in national brands i.e. The kind of brand architecture, promotional offers going on, prices, service, salesman’s explanation and features. So, this research has narrowed down on these factors.

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Chapter III

Vijay sales

Originating from the principle of giving customers the best in quality and service,

Vijay Sales was established as a partnership firm by Mr. Nanu Gupta, an

entrepreneur with astute business acumen and foresight. From a small TV showroom

in Mahim in 1967, Vijay Sales has long since evolved into one of Mumbai’s leading

chain of electronic superstores, now having expanded to major cities across India.

Along with a team of professional managers, delivering on the promise of servicing

customer needs and efficient post-sales services, together with his two sons Mr.

Nilesh Gupta and Mr. Ashish Gupta, Mr. Nanu Gupta remains the driving force

behind the Vijay Sales enterprise.

With aesthetically designed and conveniently located showrooms, Vijay Sales caters

to customers of all budgets and preferences. Through customer focused policies and

the intuitive understanding of emerging markets, today after more than four decades

of successful operations, Vijay Sales has become a trusted name synonymous with

quality electronics & consumer durables.

Every great achievement has humble beginnings.

What began as a small TV showroom in Mahim in 1967, has long since evolved into

one of Mumbai's leading chain of electronic superstores. Nanu Gupta, an

entrepreneurial skills coupled with astute business acumen, has always focused on

giving customers the best in quality and services.

You can shop for 9000 products across eleven categories in a world-class ambience.

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This has been the chief driving force behind 'Vijay Sales' expanding presence in

West India.

Today, after more than four decades of successful operation, Vijay Sales has become

a trusted name and synonymous with quality electronic goods. We have grown from

one showroom into a chain of showrooms across western region at prominant

location in the city of Pune,Surat & Ahmedabad other than Mumbai,each

aesthetically designed and conveniently located, catering to customers of all budgets

and all preferences.

We have always been a firm believer in servicing customer needs and efficient post-

sales services. Our customer-focussed policies together wih the intuitive

understanding of emerging markets has led Vijay Sales from strength to strength.

Thanks to a very good relationship with more than thirty suppliers of well-know and

established brands,we can offer prompt and reliable after sales services to all

customers.

" WINNING DOESEN'T ALWAYS MEAN BEING FIRST,

WINNING MEANS YOU'RE DOING BETTER THAN YOU'VE DONE BEFORE

"

We Believe,

The competitive strength of a company should be measured not by the volume of

sales or the range of innovation, but by the extent of involvement of all the

association in the quality improvement process.

We've kept that step ahead by listening carefully to our customers over the years, by

paying expert attention to an ever-changing economic environment,and by giving our

people the opportunities to realize their potential.

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As we look the road ahead,we are determined to exceed our historical success. And

we'll do it by constantly increasing the value of our offerings to our customers and

increasing the caliber of our services to such a high level, that our name will become

synonymous with customer satisfaction.

As pioneers of electronic retailing and India's preferred chain of electronics

superstores, have a high level of responsibility towards our customer for the faith

they place upon us.

Vijay Sales would give its customers best value, best products and the best available

service in the industry.

Honesty towards our customers,principals and our associates would be the pillar on

which Vijay Sales would stand and grow.

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CHAPTER IV

Croma, the largest Electronics Megastore in India stands by its tagline “we help you buy” by providing its customers with a wide variety of consumer electronics and durables to choose from. Croma strives to provide better service with a nation-wide network of several Croma and Croma Zip stores, along with its latest online vertical - Cromaretail.com.

With over 6000 products across varied categories including Phones, Cameras, Computers, LCD/LED’s, Home Appliances and more, we help in selecting electronic devices from multiple brands as per the personalized requirements of a consumer. Our own label Croma Life Accessories, comprising of a diverse range of merchandise from various categories like tablets, android phones, air-conditioners, kitchen appliances and much more, presents the consumers with an option to buy products featuring the latest technologies at reasonable prices.

Shopping at Cromaretail.com or our Croma stores will be a fulfilling experience giving you access to a wide range of products with exciting deals. All this comes with a great after sale service provided by an authorized 24 x 7 customer care centre.

Croma is the nation's first large format specialist retail chain for consumer electronics and durables with successful expansion into Croma Zip stores, Croma Kiosks and latest online vertical, www.cromaretail.com.

At Croma, we help you buy.

Croma has been launched by Infiniti Retail Limited, a 100% subsidiary of Tata Sons. It efficiently and successfully runs Croma's retail operations in India. In addition, one of the world's leading retailers.

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We offer our customers over 6000 products across eight categories in a world-class ambience and our offerings are growing every day. These categories include Phones, Camera, Computers, Entertainment, Home Appliance, Kitchen Appliance, Gaming and Accessories. Great products from some of the best brands ensure you an exciting shopping experience.

Our own label by the name of Croma Life Accessories is well recognized for offering innovative and unique products that are hard to find. A diverse range of merchandise in various categories like kitchen appliances, storage devices, MP4 players, air conditioners & lot more ensures you only the best. From the wide range of Croma branded products, you are bound to find something great that will match up to your budget as well as personal requirements.

At Croma, our endeavor has always been fulfilling every electronic requirement by helping customers choose the best product, as per their needs. Croma's efficient, well-trained and knowledgeable store advisors are completely equipped to offer sound and personalized advice for helping a customer receive the best value for money. Making shopping experience delightful post purchase is the foundation for investing in a robust customer service support at Croma. Any individual can get in touch with us through our 24 hours call centre support at 1800-258-3636. Our Authorized Croma Care Centre provides after sales support for all Croma branded products

Ecommerce is our latest venture to achieve yet another important goal, which is to bring customer the best shopping experience on the go & reach every door step in the

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nation. With www.cromaretail.com you can now explore, browse and purchase from the finest and the most varied range of electronic products in the comfort of your home. Well structured product information, great deals and swift home delivery service are our priority for customer's satisfying shopping experience.

Brand Philosophy

If service wasn't important.

If technology wasn't complex.

If variety wasn't confusing.

We would have no reason to be in business.

We help you buy.

Why Croma

Widest range of products

Explore and choose from more than 6000 products across varied categories, which include Phones, Camera, Computers, Entertainment, Home Appliance, Kitchen Appliance, Gaming and Accessories.

We help you buy

Sound and knowledgeable advice from well-trained advisors help you make informed buying decisions.

A name you can trust

Croma is promoted by Infiniti Retail Ltd, an initiative of the Tata group, a globally recognized brand that stands for trust and reliability.

Customer commitment

Our dedicated customer support team are well equipped to handle all customer complaints & feedback. The Authorized Croma care centre provides robust service

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support on own label products, while Croma's 24 hours call centre is equipped to handle your every query at 1800-258-3636.

Great deals and offers

Nothing else makes a customer smile like receiving amazing deals on their favourite products. To ensure this, Croma periodically offers exciting deals that are hard to miss.

Wide reach, all over the nation

Croma Mega store, Zip store and Kiosk, along with its latest online vertical, www.cromaretail.com ensures wide spread & reach all over India. Through these focal segments we intend to reach customers all across the nation to fulfil their electronic necessities with great quality and valuable products.

National Recognition

Croma has always been dedicated towards giving its customers an easy and hassle-free access to best consumer electronics products. This dedication has earned the company "Most Admired Retailer" award 6 years in a row from Indian Retail Forum.

Croma is passionate about combining technology and world-class retailing to give customers an extensive assortment of their favourite products. We invite you to enjoy great-quality merchandise, knowledgeable service and a pleasant shopping experience. 

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Chapter V

Need for research

Multi brand in electronic and home appliance Vijay Sales is one of the most popular

Mulit brand stores in various part of Indian. promotion launched with over 55

products across six product categories: refrigerators, color television, DVDs,

washing machines, microwave ovens and dishwashers. Home Appliances being one

of the most attractive segments, has got numerous big players namely LG,

Whirlpool, Samsung, Onida, Godrej, Videocon being the front runners. So it was

never an easy job for Haier to enter such a competitive market, establish and sustain

itself. And in order to sustain in such a competitive market, Haier required regular

upgradation in their strategy and value addition in their product through continuous

market research.

OBJECTIVES OF the study

To study about Vijay sales

To find out consumer awareness of various brands in the home appliances &

electronics market.

To find the perception of consumers towards Vijay sales & Croma .

To find out how consumers associate with Vijay Sales & Croma

To identify the important attributes impacting consumer buying behaviour in

the purchase of home appliances & electronics products at vijay sales &

Croma.

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To find Purchasing pattern of customer and preference toward organized and

unorganized retail format

Methodology

The research conducted is ‘Descriptive research’, where the primary data will be

collected through a detailed questionnaire.

Sample design

A survey will be conducted to collect a primary data from a sample of around 150

people of which includes x male and x females of different age group in between

20-30,30-40 and 40-50 of different age income group monthly in between 20k-

30k,30k-40k and greater than 40k respectively for various brands such as

LG,whirlpool,Samsung,onida and Godrej to observe and understand the consumer

behaviour across six product categories: refrigerators, color television, DVDs,

washing machines, microwave ovens and dishwashers – i.e. the entire range of home

appliances will be considered.

Data collection method

Primary Data will be used to make our analysis and it will be collected

through survey method.

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Secondary data will be used to make various feature-wise analyses of various

models of home appliances products & electronics goods and will be taken

from various websites of the brands & Vijay sales

Limitations

A detailed study of various Modern Retail store within Mumbai will be carried out, where popular brands of Home Appliances are available, to observe and understand the consumer behavior and the buying pattern and a feature wise comparison of product of various brands vis-à-vis

21

Chapter VI

SWOT analysis of the Consumer electronics sector in India

22

Chapter VII

SWOT analysis of the Consumer home appliances sector in India

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Chapter VIII

Sales Promotion

Sales promotion refers to many kinds of incentives and techniques directed towards

consumers and traders with the intention to produce immediate or short-term sales

effects.

Definition:

“Sales promotion includes incentive-offering and interest-creating activities which

are generally short-term marketing events other than advertising, personal selling,

publicity and direct marketing.

The purpose of sales promotion is to stimulate, motivate and influence the purchase

and other desired behavioral responses of the firm’s customers.”

More on it...

Sales promotion offers a direct inducement to act by providing extra worth over and

above what is built into the product at its normal price. These temporary

inducements are offered usually at a time and place where the buying decision is

made. Not only are sales promotions very common in the current competitive market

conditions, they are increasing at a fast apace. These promotions are direct

inducements. In spite of the directness, sales promotions are fairly complicated and a

rich tool of marketing with innumerable creative possibilities limited only by the

imagination of promotion planners. Sales promotion is often referred to by the names

of ‘extra purchase value’ and ‘below-the-line selling’.

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Used to achieve short-term sales :

Sales promotion is a separate and distinct element in the promotion mix and is an

important and powerful tool of marketing. The aim of sales promotion is goal-

oriented to achieve sales/marketing objectives which are short-term and immediate.

Becoming too common :

Today we find companies in almost all sectors offering some sort of a promotion

scheme. These sectors range from automobiles to beverages, from financial services

to foods, from household durables to services, from household products to business

products, from personal care to textiles and apparel.

Writing about sales promotion tools, Prof. Philip Kotler observes – “they have 3

distinctive characteristics.”

1. Communication: they gain attention and usually provide information that

may lead the customer to the product.

2. Incentive: they incorporate some concession, inducement, or contribution that

gives value to the consumer.

3. Invitation: they include a distinct invitation to engage in the transaction now

(offer valid till …or till stocks last)

Advantages of sales promotion

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Sales promotions have a significant effect on the behaviour of consumers and trades

people. Such promotions can bring in more profits for the manufacturers because

they permit price discrimination.

Price discrimination

Producers can introduce price discrimination through the use of sales promotions.

They can charge different prices to different consumers and trade segments

depending on how sensitive each segment is to particular prices. Coupons, special

sales events, clearance sales and discounts are examples to explain the phenomenon.

Often such price discrimination are offered in specific cities in the country, .

Such price discriminating sales promotions that enable consumers and traders to pay

less in certain market area or stores usually bring in more contribution than if one

price is charged to all. Such price discrimination also held in adjusting to

fluctuations in demand and supply situation without affecting any changes in the list

price.

Effect on consumer behaviour

As sales promotions are mostly announced for a short period, customers may feel a

sense of urgency and stop comparing the alternatives. They are persuaded to act now

rather than later.

With every 500g pack of Bournvita, you get a free mug . Offer valid only till stocks

last.

26

In our over communicated society and because of selective attention, it is not

uncommon to ignore many advertisements. Sales promotion deals such as discounts,

debates, coupons, premiums, etc also increased the attention getting power of

advertisements and convey the advantages and benefits of the brand, including price

information. By using promotions, marketers can reach the deal prone customers and

encourage brand switching.

Effect on trade behaviour

Short-term promotions present an opportunity and encourage dealers to forward by.

This forward buying ensures that retailers won’t to go out of stocks. As dealers have

more than the normal stocks, they think it advisable to advertise in local media,

arranged displays and offer attractive promotion deals to consumers. These actions

help in increasing the store traffic.

Private label awareness Factors for preference to Brand

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Chapter IX

MANAGERIAL IMPLICATIONS:

Consumer durables and electronics are usually low margin high value products. In

such a competitive environment, it becomes indispensable for companies to develop

strategies and methods to sustain their position in the market and to generate higher

profit margins. Retailers can achieve it with the help of private labels. Therefore,

private labels form an integral part of company’s overall strategy and objectives.

The paper discusses few parameters considered by the customers for evaluating the

store brands. How a retailer can use those parameters to enhance the overall

contribution of private labels in the sales and to increase its acceptance for the

customers is discussed below: The merchandising mix at any store should be

complete and satisfying for the customer. The merchandising mix should have a right

mix of national and store brands i.e. there should be a harmony between the two

offerings and they should be available in a price range, capable of fulfilling the

requirements of the target market. In addition, the retailer has to focus on developing

the store image as we find there is a positive correlation between the store brand

equity and sales of private labels. Another important aspect which was identified in

this study was the importance of knowledge about the brand. For private labels brand

is the retailer itself and functional aspects of a particular product labeled in - house.

For this the most important role particularly played for store brands, is by the

Customer Sales Executives (CSA’s).Other being the past experience of the customer

with the brand, which can be positive only by providing a good quality product.

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CHAPTER X

Marketing strategy

Involves careful scanning of the internal and external environments

which are summarized in a SWOT analysis. Internal environmental factors include

the

marketing mix, plus performance analysis and strategic constraints. External

environmental factors include customer analysis, competitor analysis, target market

analysis, as well as evaluation of any elements of the technological, economic,

cultural or political/legal environment likely to impact success. A key component of

marketing strategy is often to keep marketing in line with a company's overarching

mission statements.

Once a thorough environmental scan is complete, a strategic plan can be constructed

to

identify business alternatives, establish challenging goals, determine the optimal

marketing mix to attain these goals, and detail implementation. A final step in

developing a marketing strategy is to create a plan to monitor progress and a set of

contingencies if problems arise in the implementation of the plan.

Customer Profiling is, Description of a customer group or type of customer based

on

various demographic, psychographic and/or geographic characteristics; also called

shopper profile. For example, magazine advertising salespeople provide advertisers

with customer profiles describing the type of person who will be exposed to

advertisements in that magazine. The description may include income, occupation,

29

level of education, age, gender, hobbies, or area of residence. Customer profiles

provide the knowledge needed to select the best prospect lists and to enable

advertisers to select the best media.

Customer profiling is generally done to answer the basic marketing questions like

given

below and many more:

Who are the customers?

What types of people are attracted to different offerings?

What kinds of people live near a given address (store location)?

What kinds of people live in a given geographic area (this is useful when

trying to decide where to locate a new store)?

And where do certain kinds of people live (when trying to market to new

customers)?

Therefore, it is the Customer description that includes demographic, geographic, and

psychographic characteristics, buying pattern, creditworthiness, purchase history,

etc.

Customer profiling in Retail Customer profiling in Reatil Sector, wherein invaluable

information and data about customers and their transactions is observed and

interpreted. The solutions are offered with the view to streamline marketing activities

to increase the probability of returns. The analysis results in Purchase acceleration,

Brand switching, Basket effects and Store choice and maintenance of price image.

30

Owing to this comprehensive solution, clients have enjoyed benefits of easy

customer acquisition, loyalty and sales growth.

Customer profiling and behavior

With thorough market understanding, we render comprehensive solution that gives

an insight to purchasing behavior of customers. The research is conducted to study

and analyze customer's buying patterns and attitudes. Owing to these solutions, the

clients have marched ahead of their counterparts implementing apt marketing

strategies purchasing behavior of customers. The research is conducted to study and

analyze customer's buying patterns and attitudes. Owing to these solutions, the

clients have marched ahead of their counterparts implementing apt marketing

strategies.

2. Merchandise management

Clients can avail Merchandise Management solutions, which allows them implement

retailing strategies. Experts are being appointed, who use apt techniques to study

historical data, customer scorecards and their buying behavior. For example,MAX

decides how to manage the merchandise depending on the customer profiling.The

benefits of the solution are listed below:

Placement of items

Amount of stock to be displayed

Space for specific product/category

Placement of slow moving items in inventory

Planning for sales & promotions

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Display of new merchandise

3. Promotion design in Retail Store

With assistance of competent workforce, promotion solutions for esteemed clients

are

offered. The promotion is designed as per latest market trends after a thorough

assessment of historical data and factors affecting retail sales. The promotional

activities of the clients have helped them increase sales significantly.The promotion

is designed as per latest market trends after a thorough assessment of historical datas

and factor affecting retail sales. Like PANTALOONS uses its historical data based

on customer profiling to design the promotional activities.

4. Shop floor design service

The comprehensive solution is offered after a detailed assessment and analysis of

customer’s buying behavior and premises. The designing strategy involves

placement of stock at right place, display theme and other such factors.

Market Placement

Market placement here means, how the customers are perceiving MAX as a

brand. This includes various questions like,

What percentage of customers are visiting store?

How the customers perceive the other similar stores?

How the customers perceive as brand?

What attracts them to BRAND ?

Are they satisfied with the ambience of the store?

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All these and many more questions are being asked to the customers through

the questionnaire from where the customers’ perception about the store is

taken. This helps the store manager to take proper action required to attract

most customers in the given area where store is located and also to retain the

existing customers.

Thus market placement is an important criterion to be checked regularly by the

retailers to improve the store performance.

Customer services in Retail

Marketing is concerned with the exchange relationships that exist between a retailer

and its customers. Quality and customer service are the key elements in this

relationship. Today’s competitive environment requires retailer to understand and

apply properly the concept of relationship from the perspective of the customer and

the other channel members. This will ensure that: Customers strongly believe that the

retailer offers good value for money; and All the channel members (including the

customer) would like to do business with that retailer.The challenge of the retail unit

is to bring three critical areas, namely marketing, customer service, and quality, into

closer alignment. Relationship marketing attempts at bringing these areas together.

Loyalty Programmes: Bases of loyalty programmes Retailers focus on loyalty

programmes since it is believed that:

Loyal customers are cheaper to serve.

They are willing to pay more for a given bundle of goods.

33

They act as effective marketers for the store’s offerings.

Relationship rewards as part of loyalty programmes

Reward is a crucial part of any loyalty programmes. It has to be desirable enough to

change the behavior of the customers. In fact, if the reward is really well chosen, it

will be attractive to customers who are not really valuable to the business. There are

various types of rewards like,

Simple discount

A more targeted discounts

Points which lead to gift from a catalogue

Points which lead to later money offs

Extra services.

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CHAPTER XI

QUESTIONNAIRE

Q1. What age group do you belong to?

a) 20 – 30 Yrs

b) 30 – 40Yrs

c) 40 -50 Yrs

Sr. NO. What age group do you belong

NO. OF RESPONDENTS

1 20 to 30 yrs 432 30 to 40 yrs 473 40 to 50 yrs 10  TOTAL 100

Q2. What is the family Size: (above 5 Yrs in age?)

a) 1 to 3

b) 4 to 7

C) 8 to 12

d) More Than 12

Sr. NO. What is the family Size

NO. OF RESPONDENTS

1 1 to 3 332 4 to 7 243 8 to 12 94 More than 12 34

  TOTAL 100

35

Q3. . Which category does your monthly Income fall into?

a) Rs. 20,000 to 30,000

b) Rs. 30,000 to 40,000

c) Above 40,000

Sr. NO. Monthly Income RESPONDENTS

1 Rs 20000 TO 30000 39

2 Rs. 30,000 to 40,000 41

3 Above Rs 40000 20

  TOTAL 100

36

Q4. Which are the Home Appliances you are aware of or you are using?

a) Refrigerators,

b) Color television,

c) DVDs,

d) Washing machines,

e) Microwave ovens

f) Dishwashers

Sr. NO. Home Appliances you are aware of or you are using

NO. OF RESPONDENTS

1 Refrigerators 40

2 Color television 57

3 DVDs 1

4 Washing machines 2

5 Microwave ovens 0

6 Dishwashers 0

7 TOTAL 100

37

Q5. What are the Brands which come to your mind when you think of these

home appliances when buy at vijay sales?

a) Haier

b) Hitachi

c) LG

d) Samsung

e) Whirlpool

f) Godrej

Sr. NO. Brands which come to your mind when you think of these home appliances

NO. OF RESPONDENTS

1 Haier 4

2 Hitachi 5

3 LG 19

4 Samsung 24

5 Whirlpool 10

6 Godrej 38

7 TOTAL 100

38

Q6. Which is the most preferred brand of Home Appliances? Rank them

according to your preference at vijay sales:

a) Haier

b) Hitachi

c) LG

d) Samsung

e) Whirlpool

f) Godrej

Sr. NO. Which is the most preferred brand of Home Appliances

NO. OF RESPONDENTS

1 Haier 2

2 Hitachi 3

3 LG 15

4 Samsung 30

5 Whirlpool 10

6 Godrej 40

7 TOTAL 100

39

Q7. What do you keep in mind before buying the Home Appliances at vijay

sales?

Rank the attributes according to your preference:

a) Price / EMI Schemes

b) Features

c) Technology (power save)

d) Convenience

e) Brand Image

f) After Sales Services

Sr. NO. mind before buying the

Home Appliances?

NO. OF RESPONDENTS

1Price / EMI Schemes 5

2Features 25

3Technology (power save) 15

4Convenience 5

5Brand Image 20

6After Sales Services 20

TOTAL 100

40

Q8. How much time do you take in making a purchase decision at vijay sales?

a) 1st Visit

b) 2-3 Visit

C) 3-5 Visit

d) More Than 5 visits

Sr. NO. How much time do you take in making a purchase decision?

NO. OF RESPONDENTS

11st visit 45

22nd – 3 visit 25

33-5 visit 20

4More than 5 visit 10

Total100

41

Q9. How do you get information about the Home Appliances and Products at

vijay sales?

a) Television

b) Radio / FMs

c) Newspaper

d) Books & Magazines

e) Friends & relatives

f) Internet

How do you get information about the Home Appliances and Products

1Television

5

2Radio / FMs

25

3Book and Magazines

15

4Friends and relatives

5

5Internet

20

6 New Paper 20

TOTAL 100

42

Q10. Does advertisement & sales promotion influence your purchasing

decisions at vijay sales?

a) Yes

b) No

c) May Be

Does advertisement influence your purchasing decisions at vijay sales?

1Yes

85

2No 15

3 May be 10

Total100

43

Q11.What home appliance/s was purchased by you in last 12 months at vijay

sales?

a) ACs

b) CCTVs

c) Refrigerator

d) Washing Machine

Sr. NO. Which is the most preferred brand of Home Appliances vijay sales

NO. OF RESPONDENTS

1 AC’s 2

2 CCTV’s 3

3 REFRIGERTOR 15

4 WASHING MACHINE 30

5 TOTAL 100

44

Q12. What home appliance/s do you plan to purchase in next one month at vijay

sales?

a) ACs

b) CCTVs

c) Refrigerator

d) Washing Machine

Sr. NO. What home appliance/s do you plan to purchase in next one month?

NO. OF RESPONDENTS

1 AC’s 10

2 CCTV’s 45

3 REFRIGERTOR 25

4 WASHING MACHINE 20

5 TOTAL 100

45

Q15. What attributes you want to see in the products vijay sales?

Cost

Style

Color

Technology

Uniqueness

Sr. NO. How do you get information about the Home Appliances and Products

NO. OF RESPONDENTS

1 Cost 36

2 Style 24

3 Color 10

4 Technology 20

5 Uniqueness 10

TOTAL 100

46

Q16. Product replacement of your old home appliances is based on:

a) Time Factor

b) Technology

c) Offers

d) Immediate Need

e) Others

Sr. NO. How do you get information about the Home Appliances and Products

NO. OF RESPONDENTS

1 Time Factor 23

2 Technology 29

3 Offers 30

4 Immediate Need 10

5 Others 8

TOTAL 100

47

Q18. What factors do you think play an important role to motivate customers

vijay sales?

a) Monetary benefits

b) Communication

c) Unique features

d) Social needs

Sr. NO. How much time do you take in making a purchase decision at vijay sales?

NO. OF RESPONDENTS

1 Monetary benefits 42

2 Communication 10

3 Unique features 38

4 Social needs 10

Total 100

48

Q19. In your view, what is the motive of people behind while purchasing the

products at vijay sales1?

a) Price

b) Quality

c) Service

d) Brand name

e) New technology

Sr. NO. How much time do you take in making a purchase decision?

NO. OF RESPONDENTS

1 Price 29

2 Quality 21

3 Service 12

4 Brand Name 20

5 New Technology 18

Total 100

49

Chapter XII

RECOMMENDATIONS

Possible solutions

1. There is a need to have a relook at FTAs with Thailand/ASEAN as far as

Consumer Electronics & Home Appliances sector is concerned. As an

immediate measure Product Specific Rules should be made applicable for

consumer appliances sector products. Critical inputs such as Open Cell for LED

TVs should be made in the country of Origin.

2. Due to implementation of FTAs, CE&HA sector is facing inverted duty

structure, where the final product is being imported at 0/concessional import

duty, whereas inputs attract 10/7.5% duty. We recommend that import duty on

inputs, which are not made in the country, be brought down to 0%. It will boost

indigenous manufacturing.

3. Since there is very high degree of Electronics involved in Home Appliances

and also since the imports of these products is resulting in

heavy outflow of foreign exchange and as it is an employment intensive sector,

Home Appliances should be treated as Electronic Products & extended benefits

of MSIPS, EMCs etc.

4. Treat Set Top Box in the same category as telecommunication network

equipment and thereby allow MSOs/DTH Operators to issue form ‘C’ even

without reselling the product. With this step at least half of the demand of 100

million Set Top Boxes will be met through domestic manufacturers in next 2

years, potentially generating employment to more than 5000 people.

Alternatively the import duty on Set Top Boxes is raised to 15% to provide level

playing field to indigenous manufacturers.

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5. Presently the Inputs for the Consumer Electronics & Home Appliances sector

are not available through indigenous sources and have to be imported. This is a

big handicap and adds to the cost of manufacturing final product. Greater

emphasis should be laid by Govt. to encourage component Industry. If the

inputs are available, at competitive price indigenously, it will help in growth of

CE&HA industry. It will also result in greater value addition within the

country, building the right eco system for the country and creating huge

employment opportunities.

Recommendations for sustainable growth

Infrastructure development

Lack of adequate physical infrastructure such as roads, ports, airports, electricity etc.,

are adversely affecting the competitiveness and productivity of the domestic home

appliances industry in India. Uninterrupted power supply is a necessary condition for

operation manufacturing units as power fluctuations can lead to major losses to the

manufacturing processes. Moreover, the demand of home appliances such as Air

Conditioners, Refrigerators, Washing Machines, Microwave Ovens and Vacuum

Cleaners are driven by the electrification of homes and uninterrupted supply of

electricity in the already electrified areas. Indigenous manufacturing in the entire

value chain of ESDM is needed for economic development. Attractive fiscal

incentives across the value chain of the ESDM sector through a modified special

incentive package scheme (M-SIPS) provided by government to eliminate the

disability costs in manufacturing on account of infrastructure gaps relating to power,

transportation etc. is a step in right direction.

Incentives provided for setting up of 200 Electronic manufacturing clusters (EMC’s)

with world class logistics and easy to do business facilities should help. The benefits

of National manufacturing policy and National investment and manufacturing zones

(NIMZ) are available to EMCs.

51

Raw Material, Components & Machinery

Weak supply chain network and lack of vendor support also affects the quality,

productivity and competitiveness of the sector. There should be hassle free import of

raw material and components by streamlining the import policy and and through the

simplification of procedures.

Skill Development and Training of Manpower

In the context of achieving the necessary ‘scale’ and ‘speed’, the following solutions

could be the way ahead in providing a conducive environment for India to meet its

skill development goals:

Targeting skill development at all levels of the ‘skill pyramid’

Implementing Vocational Education in schools

Creating a large talent pool through Modular Employable Skills

To significantly enhance the availability of skilled manpower in the ESDM sector, a

special focus for augmenting post-graduation is required

Encouragement should be given for setting up of skill oriented courses and training

programs along with hands on laboratories enabling graduates from other disciplines

to mitigate to EDSM.

R&D and Technology Up gradation

Indian manufacturers are not able to compete with global majors due to the high

level of technological knowhow and R&D content required for indigenous

manufacturing. Technology transfer, R&D and IPR creation should be incentivized

by government through friendly tax regime. A vibrant and sustainable ecosystem of

R&D, design and engineering and innovation is required to enhance manufacturing

52

capabilities of electronic raw materials, components, sub-assemblies as well as

products.

Productivity Enhancement for Raising Profit Margins

To tackle the factors hindering the productivity and competitiveness of the sector, a

number of strategic initiatives need to be taken up by Industry Associations,

manufacturers and Government. In order to become competitive in the domestic as

well as world market, consumer appliance manufacturing units need to formulate

strategies based on market intelligence, product development, R&D, demand

forecasting and competitive pricing productivity estimations based on Labour and

Total Factor Productivity Growth rates have been found quite low in the light

electrical sector particularly home appliances segments, there is a need for

substantial up gradation of skill levels and technological knowhow (R&D activities)

in this sector for further value addition at the domestic level.

53

Chapter XIII

CONCLUSION

The phenomenal growth of organized and modern retail has a favourable multiplier

effect on the Indian economy. At present it is already considered to be India’s

backbone in terms of employment generation after agriculture. The organised retail

is attracting a huge inward investment in several support

industries such as logistics, IT, which is strengthening the supply chain. The arrival

of private brands are generating demand and sourcing tie-ups with manufacturers

across products. The rising education mania and fast adopting online shopping

behaviour of the consumers, facilities provided by the bankers will play a proactive

role in bringing prosperity to modern retailing in India. Organised retailing is

creating a pool of qualitative work force that is gaining vocational studies in schools

and colleges. Since organised retail sector is fearful about price and competitive

pressure, there is a need for some mechanism so that both traditional and modern

retail can continue to grow in harmony eventually closing the gap between the

organised and modern retail sector. Geographically dispersed population,

illiteracy, infrastructure problems, small ticket sizes, complex distribution network,

little use of IT systems, limitations of mass media and existence of counterfeit goods

are some of the problems affecting it.

The passage of this FDI bill will facilitate many big retail chains make a foray

into India. But it is to regret that this policy is facing problems in implementation as

many states are opposing vehemently citing different

negative aspects of FDI. But all baying voices are not thinking that the arrival of

giant retail chains will add a new dimension in the organised retail industry

benefiting all stake holders across the board in the short as well as in the long run. At

54

large, it can be said that organized and modern retailing in India is marching towards

prosperity because of conducive and congenial atmosphere in this giant country

barring a few exceptions of impediments. The modern retail sector is benefiting the

society in terms of better product, choices, price and employment generation. The

farmers are benefiting in terms of reasonable price realisations for their produce. It is

also creating an atmosphere of investment.

55

Chapter XIV

BIBLOGRAPHY

Taylor, John (1978). How to start and succeed in a business of your own. p. 290.

Electroluminescent Point of Purchase Signs

Stuart Mitchell, "Resale price maintenance and the character of resistance in the conservative party: 1949-64," Canadian Journal of History 40, no. 2 (August 2005): 259-289.

Anonymous (May 13, 2000). "Handcuffs on the high street". The Economist 355, no. 8170 62.

www.allbusiness.com

www. haier,co,in

www.financialexpress.com

www.fidelity.co.in

www.itcportal.com

www.indiaretailbiz.com  

Business Standard

www.vijaysales.com

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