Vision - September/October 2007 - (Page 25) with india “Customers here prefer a higher bass in their audio systems,” Shin notes. “They want to hear the ‘thump’ in their music [along with] a higher sound output. “In certain areas we also introduced TV sets with an interactive menu in regional languages for ease of use,” he adds. Meanwhile, Loyd Ivey, CEO of Mitek Corp., focuses on another vital factor in retailing to the vast emerging Indian electronics markets. Bringing products to an emerging market, Ivey insists, “is not a problem if you have a good distributor.” Marketing Sensibly Sharma, Shin and Ivey are among the horde of electronics mar- Reaching this huge potential audience is the first challenge. keters who are focusing on the fast-growing Indian market and “In India, marketing has to be a strategic balance of both ‘abovefinding ways to adapt their operating methods to the opportu- the-line’ and ‘below-the-line’ activities,” says LG’s Shin. “Advertising nity. But the country poses immense challenges. In the mobile needs to strike a delicate balance between emotional and rational sector alone, there are more than 75,000 retailers, overwhelmingly “advertiSing needS to Strike a delicate “mom-and-pop” shops, accordBalance Between eMotional and rational ing to Motorola estimates. About 85 percent of handsets are sold aPPeal. a Purely technology-BaSed coMthough these outlets, underscorMunication will not work.”—Moon B. Shin ing Ivey’s point about the value of trusted distributors. Even the largest chains have only a few dozen stores, adding appeal. A purely technology-based communication will not work.” additional complexity to the retail process. In early August, WalLG, which just celebrated its tenth year in India, has the top-selling Mart Stores Inc. announced its joint venture with Bharti Enter- color TV sets and DVD players in the country. Shin points out that, “In prises. Bharti Retail will own and manage the retail stores and an environment where the consumer is being loaded with offers, LG difWal-Mart will provide technical support in the form of modern ferentiated its products on the basis of technology, which appealed supply chain and back-end logistics expertise. Bharti and Wal- to the emotion of the Indian consumer.” Mart each hold a 50 percent stake in Bharti Wal-Mart Private Dell has operated in India since 1996. It has four facilities— Limited. The first wholesale cash-and-carry facility is due to open Bangalore, Hyderabad, Chandigarh and Gurgaon, and is nearing by the end of 2008, with plans to open 10–15 facilities over the next completion of a manufacturing site in the state of Tamil Nadu. few years. Best Buy reportedly is also eyeing an Indian connection. Rajan Anandan, vice president and general manager of Dell India Nonetheless, for the foreseeable future, electronics retailing will says, “We have had a positive experience so far. However, we believe www.ce.org September/October 2007 depend on traditional storefront merchants. “India’s electronics industry is nascent by global standards,” the India Brand Equity Foundation acknowledged in a recent report (www.ibef.org). The entire electronics business had sales totaling about $11 billion (in U.S. dollar equivalents) during 2004–05; about 34 percent of that sum is consumer electronics. Yet every forecast about India’s economy envisions explosive growth during the coming decade. The expanding middle class and especially the high-tech work force will seek more entertainment, communications and information devices, the predictions consistently say. Overall, the Indian economy is growing at an accelerating rate, now racing ahead at about eight percent annually, according to data collected by the U.S. Commercial Services, part of the U.S. Department of Commerce. In a country of nearly one billion people, about 58 percent of the population is under the age of 20. That means India’s youth sector is almost double the entire population of the U.S. The mobile phone business typifies the market’s vitality. Nearly six million new customers per month sign up for mobile service—the “fastest growing of any country in the world,” says Lloyd Mathias, marketing director of Motorola South Asia. Yet even the current 170 million mobile phone users represent less than 20 percent of the population, leaving plenty of room for growth. Giles Caldicott/Getty Images Walter Bibikow/Alamy 25 http://www.ibef.org http://www.ce.org
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