Samsung & Micromax -comparative Marketing analysis of Mobile handset industry

An
Industry Project Report
On
“A Study of Indian Mobile Handset Industry”
In partial fulfilment of
Integrated Master of Business Administration
By
Rahul Kumar
CUJ/2012/IMBA/27 (VIth
Semester)
Centre for Business Administration
Central University of Jharkhand, Ranchi
Submitted to:
Central University of Jharkhand.

DECLARATION
I hereby declare that the work incorporated in this report entitled “A Study of Indian
Mobile Handset Industry” is the outcome of original study undertaken by me carried
out under the guidance of Dr. Ashoke Sarkar (Associate Professor, Finance), Centre for
Business Administration.
I further declare that the matter in this report has not been submitted by me as a whole or
in part at any other University or Institution for the award of any Degree or Diploma.
Date- ------------------------------
Place- CUJ, Ranchi
(Rahul Kumar)
Integrated MBA
CUJ/I/2012/IMBA/27

CERTIFICATE
This is to certify that the contents of this thesis entitled “A Study of Indian Mobile Handset
Industry” by Rahul Kumar (VIth
Sem.) submitted to Centre for Business Administration (CUJ)
for the Award of Degree Integrated Master of Business Administration (IMBA) is original
research work carried out by him under my supervision.
This report has not been submitted either partly or fully to any other University or
Institute for award of any degree or diploma to best of my knowledge.
Date-
Place-
------------------------------
Dr. Ashoke Sarkar
Associate Professor

PREFACE
Master of Business Administration is a course, which combines both theory and its
applications as its contents of study in the field of management. As part of this course, every
aspirant has to prepare industrial report. The purpose of this report is to get the in depth
knowledge (or the applied knowledge) regarding the particular Industry and enhance student’s
analytical skill.
One of the Indian booming Indian mobile handset industries, particularly the smartphone
sector, which is being researched by me from the management perspective. By studying
Indian mobile handset industry from a management perspective I would be able to analysis
potential opportunity as well as threats to the key players of the industry. Also, the
attractiveness of the industry with the help of Michael Porters five force model. The
comparative study also helps in understanding the marketing strategies practiced by the
players of the study. The data for analysis is being collected through the Secondary sources
like Internet, Newspaper, published Journals, company’s websites etc.

ACKNOWLEDGEMENT
I express my deep sense of gratitude to the Centre for Business Administration for imparting
me Field Project on “A Study of Indian Mobile Handset Industry”.
I express my sincere gratitude to Dr. Ashoke Sarkar, (Associate Professor, Finance), for
helping me in selecting a wonderful topic and guided me throughout this project with ample
support and helping me to get accomplished the report successful.
I would like to thank my Liberian, who took adequate care & effort in searching books,
magazines, journals, etc. So that I could complete my project smoothly and well in stipulated
timeframe.
Last but not the least: I would like to cite my thanks to my beloved parents and all my seniors,
friends for their encouragement, support and blessings. These pages could scarcely have been
written without their help.
I express my gratitude to the Head of the Department and Faculty members of Center for
Business Administration (CUJ), who has directly or indirectly helped me in completion of
this Field Project.

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INDEX
S.NO. CONTENTS
DECLARATION
CERTIFICATE
PREFACE
ACKNOWLEDGEMENT
CHAPTER-1
1.1 Introduction
1.2 Objectives of the study
1.3 Research methodology
1.4 Limitations of the study
CHAPTER-2
Profile of the major players of the Industry
CHAPTER-3
Literature Review
CHAPTER-4
Industry analysis
CHAPTER-5
Market analysis
CHAPTER-6
Comparative Analysis w.r.t. Samsung and Micromax
CHAPTER-7
Analysis of Marketing Strategy w.r.t. Samsung and Micromax
CHAPTER-8
Findings and Suggestions
ANNEXURE
Bibliography

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Chapter 1
Introduction

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1.1 INTRODUCTION:-
Definition of a Cell phone or Mobile Phone
The Cellular telephone (commonly "mobile phone" or "cell phone" or "hand phone") is a
long-range, portable electronic device used for mobile communication. In addition to the
standard voice function of a telephone, current mobile phones can support many additional
services such as SMS for text messaging, email, packet switching for access to the Internet,
and MMS for sending and receiving photos and video. Most current mobile phones connect
to a cellular network of base stations (cell sites), which is in turn interconnected to the public
switched telephone network (PSTN) (the exception is satellite phones. Cellular telephone is
also defined as a type of short-wave analog or digital telecommunication in which a
subscriber has a wireless connection from a mobile telephone to a relatively nearby
transmitter. The transmitter's span of coverage is called a cell. Generally, cellular telephone
service is available in urban areas and along major highways. As the cellular telephone user
moves from one cell or area of coverage to another, the telephone is effectively passed on to
the local cell transmitter. A cellular telephone is not to be confused with a cordless telephone
(which is simply a phone with a very short wireless connection to a local phone outlet). A
newer service similar to cellular is personal communications services (PCS).
The Telecom Regulatory Authority (TRAI) announced in April 2005 that the fiscal
year ending March 2005 had seen what it described as 'unprecedented growth' in telecoms
service in India, with mobiles leading the way with 55 per cent growth rate. The main driver
for the continuing high growth since 1996 had been the falling tariffs in a sector where the
mobile operators have been prepared to lose money to keep or win market share and have
consequently been fighting a fierce price war. Facing the prospect of subscriber growth
reaching saturation point in the larger cities, the country's mobile operators were increasingly
eyeing the vast rural market in the next step in boosting mobile phone growth.
In March 2005 it was reported that the average per minute charge for mobile services in India
declined by 58 per cent to 1.20 rupee (US$0.27) during the quarter ending December 2005,
compared with 1.90 Rupee (US$0.043 during the previous quarter.
As an indication of how the Indian mobile market was expanding, In May 2005 LG
Electronics India announced plans to build a GSM handset manufacturing plant in

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Ranjangaon near Pune as part of plans to produce 20 million GSM handsets by2010. The
company said the facility was part of LG's plans to make India its global export hub. Sony-
Ericsson also said it saw significant new growth areas in emerging markets like India which
were helping drive sales of mobile phones.
The mobile market in India continued its strong growth through 2007 and looked to be
carrying a 50 per cent annual growth rate into 2008. While the market was initially totally a
GSM domain, CDMA technology was introduced as a Wireless Local Loop (WLL) service,
which after a long battle with the regulator was eventually accepted as a legal mobile service.
The subscriber base has developed into a fairly stable mix of GSM subscribers, (74 per cent
market share at end-2007) and CDMA subscribers (24 percent). The regulator initially
referred to these CDMA service as WLL (Mobile), or WLL (M). These CDMA services were
differentiated from WLL (Fixed), or WLL (F) services, which at the time were being included
as part of the fixed-line segment of the market. In 2006, TRAI started putting the emphasis
on the 'wireless' in WLL in WLL (F) and grouped all WLL services with 'mobile' services.
Although well behind China a terms of the total size of its mobile subscriber base, a
comparison of net growth by end 2006 was interesting. Chain added a total of just fewer than
6.1 million subscribers in December 2006, bringing the total additions for the December
quarter to just less than 18 million; India, by contrast, added 6.25 million in December to
being the total number of additions to 19.5 million for the quarter.
India’s Handset Market( Smartphone Vs. Featured Phone)
The situation has changed over the past few years with the entry of more global brands and
the emergence of home grown manufacturers in the handset market. Wider availability of
more affordable handsets, including smartphones, and significantly lower call rates has
catalysed growth in the market, most notably in rural areas. Competition within the crowded
market is intense with more than 50 device manufacturers now selling their products. Most
of these companies focus on low cost feature phones. While feature phones have dominated
the market for some time, their position is being eroded by the emergence of better value
Smartphones, a trend which is seeing a greater number of manufacturers focus on producing
more sophisticated devices.

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According to International Data Corporation (IDC), India was the fastest growing market in
Asia/Pacific with a quarter-on-quarter growth of 27% in Q3 2014 (July – September). The
market observed exceptional growth owing to festive demand and recorded a new high in
smartphone shipments in Q3 2014. As a result, the India smartphone market outshone other
emerging markets in the Asia/Pacific region in terms of quarter-over-quarter growth.
The overall mobile phone market stood at 72.5 million units in Q3 2014, which is a 15%
quarter-on-quarter growth and a 9% year-on-year growth.
Worldwide Smartphone Market Share, Q4 2014
Holiday seasonality, strong end-user demand, and a deep selection of models propelled
smartphone volumes to a new record level for the quarter and for the year. The worldwide
smartphone market grew 28.2% year over year in the fourth quarter of 2014 (2014Q4), with
shipments of 377.5 million units, according to data from the International Data Corporation
(IDC) Worldwide Quarterly Mobile Phone Tracker. Android still dominates the market with
a 76.6% share in 4Q14. Apple managed to ship 74.5 million units this quarter with a year-
over-year growth of 46.0%, closing the gap to a near tie with Samsung. For the full year, the

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worldwide smartphone market shipped a total of 1.3 billion units. This is a 27.7% growth
from the 1.0 billion units of shipments in 2013.
Period Android iOS Windows Phone BlackBerry OS Others
Q4 2014 76.6% 19.7% 2.8% 0.4% 0.5%
Q4 2013 78.2% 17.5% 3.0% 0.6% 0.8%
Q4 2012 70.4% 20.9% 2.6% 3.2% 2.9%
Q4 2011 52.8% 23.0% 1.5% 8.1% 14.6%

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1.2 OBJECTIVE OF THE STUDY :-
1. To know the attractiveness of the industry with the help of Porter’s five forces model.
2. To understand the key drivers leading to growth of the industry.
3. To know the current position of different players in mobile handset industry.
4. To know the internal and external business environment of Micromax and Samsung
5. To understands the marketing strategy w.r.t Samsung and Micromax
1.3 RESEARCH METHODOLOGY
The research is secondary in nature. For the purpose of the study, relevant information
has been collected through books, articles, websites and annual reports of the company
under study.
1.4 LIMITATIONS OF THE STUDY:-
As the study is based on secondary data, the inherent limitation of the secondary data
would have affected the study.
The figures in market analysis are likely to be a least several months out of date, and
so might not give a proper indication of the company’s current position.
This study need to be interpreted carefully. They can provide clues to the company’s
performance or financial situation. But on their own, they cannot show whether
performance is good or bad. It requires some quantitative information for an informed
analysis to be made.

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CHAPTER 2
Profile of major players of the mobile handset industry

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MICROMAX :-
Micromax is a market leader with 22%of market share in the smartphone segment. Micromax
is an Indian consumer Electronics Company headquartered in Gurgaon, Haryana, India. It was in
2008 that four friends, Rajesh Agarwal, Sumeet Arora, Rahul Sharma and Vikas Jain, came
together and decided to diversify their IT hardware distribution business and start making
mobile phones. The move towards selling handsets was a natural progression. With a Cost
Leadership Business strategy Micromax entered into Indian rural market. And within 3 years
of operation they have become the 3rd
largest selling company in India. Over the past decade,
Micromax has pioneered the democratization of technology in India by offering affordable
innovations through their product offerings and removing barriers for large scale adoption of
advanced technologies.
Micromax products have become an extension of the Indian youth's lifestyle and
dynamism. The company has many firsts to its credit when it comes to the mobile handset
market including the 30-day battery backup, Dual SIM Dual Standby phones, QWERTY
keypads, universal remote control mobile phones, first quad-core budget smart phone etc. The
brand's product portfolio embraces more than 60 models today, ranging from feature rich,
dual-SIM phones, 3G Android smartphones, tablets, LED televisions and data cards.
Micromax sells around 2.3 million Mobility Devices every month, with a presence in more
than 560 districts through 1, 25,000 retail outlets in India. With sales presence across India
and global presence in Russia and SAARC markets, the Indian brand is reaching out to the
global frontier with innovative products that challenge the status quo that Innovation comes
with a price. Micromax is planning to launch an IPO of 2.15 crore shares to raise around Rs
2260 million. The major part of the money raised will be used in setting a new manufacturing
plant in Tamil Nadu and the rest in acquiring additional market share.
SAMSUNG –
Samsung is the second major player in this industry with the 20% of market share. Samsung
is a very healthy and prominent competitor in the market. Samsung Electronics commenced
its operations in India in December 1995 and is today a leading provider of Consumer
Electronics, IT and Telecom products in the Indian market. Samsung India is the Regional
Headquarters for Samsung’s South West Asia operations, which provides employment to over

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45,000 employees with around 11,500 employees being involved in R&D. Innovative
products specially smart phones and Galaxy series from Samsung are ruling in the market. So
it is expected that with the increasing demand of mobile phones Samsung will try to retain
and increase its market share. Apart from development of innovative technology, Samsung
places great importance on acting as a responsible corporate citizen in the communities where
it operates. Its CSR programs respond to the social and environmental needs and seek to give
back to communities that support the company. In 2009, Samsung launched the company’s
Corporate Social Responsibility initiative ‘Samsung Hope Project’ with projects in the areas
of education, culture, sports, social welfare and community development. Each programme,
under the Hope Project, uniquely addresses the needs of individual communities while
emphasizing on innovations for development of the community. The Company’s CSR
initiatives such as Samsung Smart Class and Samsung Technical Schools have been
recognised by several reputed organisations, and the Company has won accolades from these
projects aimed at giving back to the society.
GIONEE :- Gionee Communication Equipment Co. Ltd was founded on September 2002
and is now the world's top 10 mobile manufacture. It is a high tech enterprise that focuses on
the R&D, production and sales of cellular mobile devices. Our management team advocates
for a scientific and standardized enterprise management mode, with a strong sense of
innovation. The constant pursuit for professionalism and innovation is the foundation of
sustainable development at Gionee.
Nokia (now Microsoft)
Nokia is a leader in the fields of network infrastructure, location-based technologies and
advanced technologies. Headquartered in Espoo, Finland, and with operations around the
world, Nokia invests in the technologies of the future.
Today, we have three strong businesses: Nokia Networks, our network infrastructure
business; HERE, our location intelligence business; and Nokia Technologies, which is
focused on technology development and intellectual property rights activities. Through these
businesses, we have a global presence, employing around 57,000 people. We are also a major

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investor in R&D, with investment through the three businesses amounting to more than EUR
2.5 billion in 2013.
In 2011, Nokia joined forces with Microsoft to strengthen its position in the highly
competitive smartphone market. Nokia adopted the Windows Phone operating system for
smart devices and through their strategic partnership Nokia and Microsoft set about
establishing an alternative ecosystem to rival iOS and Android. In 2011, Nokia also started to
make a number of changes to its operations and company culture that would in the course of
the next two years lead to shortened product development times, improved product quality
and better responsiveness to market demand.
In 2013, Nokia moved to reinvent itself with two transformative transactions. The first was
the purchase of Siemens’ stake in NSN, which was nearing the end of a deep restructuring
and remarkable transformation. The second was the announcement of the sale of substantially
all of Nokia’s Devices & Services business to Microsoft. The Microsoft transaction was
originally announced on September 3, 2013 and was completed on April 25, 2014.
Karbonn Mobiles
Karbonn mobile is a telecommunication firm in India which was founded in March 2009. It
is a joint venture mobile manufacturing company between the Bangalore based United Tele
links Limited (a group of Telecom Major and United Telecoms Limited) and Noida based
Jaina Marketing & Associates. Karbonn Mobiles India pvt ltd has a strategic tie-up with
Sistema Shyam Tele Services Limited. The firm's total investment in Indian consumer market
was over US$5 million in the fiscal year 2011. The firm has contracted with semiconductor
companies worldwide for their handsets and targets mainly the Indian market. The firm has
over 85,000 retailers and 870 service centres (around 150 dedicated exclusively for Karbonn)
across India. Karbonn Mobiles is aiming at registering a turnover of .Rs. 4,000 crore during
the 2013-14 financial year.

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CHAPTER 3
Literature review

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India phone market is going through intense competition. We will see intensified competition
in the Indian smartphone space as Asian (companies) such as Xiaomi, Gionee, Huawei and
Asus enter with premium hardware at an aggressive price-point, attracting young tech-savvy
but price-conscious urban buyers However, these brands will have to work hard on their brand
awareness, distribution and service network to continue the growth beyond the early spike in
demand in this very important mobile phone market.(Anwar, 2014).
According to International Data Corporation (IDC), India was the fastest growing market in
Asia/Pacific with a quarter-on-quarter growth of 27% in Q3 2014 (July – September). The
market observed exceptional growth owing to festive demand and recorded a new high in
smartphone shipments in Q3 2014. As a result, the India smartphone market outshone other
emerging markets in the Asia/Pacific region in terms of quarter-over-quarter growth.
(Alamro & Rowley, 2011) Suggested that consumer attributes, brand image and band
awareness are the antecedents of brand preference. Brand preference is “the extent to which
the customer favours the designated service provided by his or her present company, in
comparison to the designated service provided by other companies in his or her consideration
set” (Alamro & Rowley, 2011)
Price is the dominant factor affecting the decision to buy mobile phone. Secondly, the
features incorporated in a mobile hand set are the most important factor which is considered
by the consumers while purchasing the mobile phone. However, all features of mobile phones
are not equally important. The other factors equally correlated and have moderate
relationships with the decision to buy are brand name and durability of mobile phones. Both
the factors are highly associated with the quality of mobile phone devices. The least correlated
factors are after sales service and social influences.
This study used multiple regressions analysis to test the effects of six independent
variables (price, social influence, durability, brand name, product feature and aftersales
service) on the decision to buy a mobile phone device. All the six independent variables
combined significantly influence the consumers buying decision of mobile phone devices.
The leading factor is price followed by product features and durability. (Sata, 2013)

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According to The Economics Times,(4 feb,2015), Home smartphone vendor Micromax
surpassed South Korea's Samsung to become the leading supplier in India's booming
smartphone market for the first time in the fourth quarter, research firm Canalys Wednesday
said. Micromax accounted for 22% of smartphone shipments in India in the OctoberDecember
quarter, up from 21% in the previous quarter. Samsung's market share fell 2 percentage points
sequentially to 20% in the fourth quarter. Samsung though has previously denied losing
smartphone market share, saying as per its data, it's share is almost double its closest rival.
This performance in Q4 is partly due to Micromax's continuing appeal to mobile phone users
upgrading to smart phones, Canaly’s analyst Rushabh Doshi said. He added that catering to
local market preferences will become increasingly important in India.
In total, 21.6 million smartphones were shipped in India in the period, up from 18.9
million in the third quarter. The firm said that total smartphone shipments surged 90% from
a year earlier period. Canalys' recently published estimates show that in the fourth quarter of
2014 in India, 23% of shipments were of devices priced under $100 (Rs 6,000), while 41%
were of devices in the $100 to $200 bracket (Rs 6,000 to Rs 12,000).

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CHAPTER 4
Industry analysis
A. Porter five forces model
B. Key drivers of the industry

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PORTERS FIVE FORCES MODEL:-
1. Threats of new entrants :- Low
The cell phone industry is highly concentrated. Since start-up costs for a in this
industry is extremely high therefore the threat of new entrants is low. High
technological investment cost needed to be compete in this industry and attain the
economies of scale. Therefore, it is difficult to enter the market with existing firms
already operating on cost and differentiation strategies.
2. Bargaining power of supplier :- Medium
since the manufacturer of the mobile handsets in the industry rely on key
supplier of required raw materials or quality components at a competitive
prices. Also the different operating systems such as android, Symbian are
opensourced.
3. Bargaining power of buyers :- Medium
Buyers bargaining power in this industry seems to be medium. They have wide
variety of phones are available to them. Major brand choices and higher prices
for the latest phones.
4. Threats of substitute :- Low
The threats of substitute produts is low due to multi-functionality of
smartphones or added functionality to smartphones over single featured mobile
phones such has high pixel cameras in the smartphones reduces the threats from
digital cameras.
5. Competitive rivalry :- High
There are major brand competitors competing and dominating the industry.
Therefore new entrants in the market can find it very hard to compete and
difficult to gain economies of scale and market share.

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KEY DRIVERS FOR THE HANDSET SEGMENT
• Increase in average household communication consumption: The share of
communications in average household consumption is estimated to increase from 1%
in 1995 to 6% in 2025. Consumer spending on communications is expected to be one
of the fastest expanding categories.
• Potential large rural market: Rural markets offer huge opportunity as there has been a
significant uptake of feature phones in these markets over the recent years. With 72%
of the Indian population residing in rural areas, telecom operators are making
significant investments to rollout their networks in these areas. In FY10, the rural and
semi-rural markets accounted for 65% of sales for most Indian handset manufacturers.
• Growth in 3G subscribers: 3G service is an emerging technology in India. 3G
technology provides growth opportunities through multiple avenues including up
gradation to 3G compatible mobile handsets and mobile data cards. 3G subscribers are
expected to reach 142 million by 2015, accounting for 12% of the total wireless
subscriber base. Furthermore, 3G subscribers are expected to be more than 300 million
by 2020, accounting for 20% of the total wireless subscriber base24
. This would drive
the uptake of 3G enabled handsets in India as customers increase their mobile VAS
usage through networks capable of faster speeds
• Value added services. Going forward, the demand for more sophisticated and
innovative e-mail and multimedia based services, as well as gaming, music and video
related offerings is likely to fuel growth in VAS. We believe the advent of 3G will also
add impetus to the growth of the VAS market due to 3G's faster network capabilities.
• Replacement cycle: The growth in the Indian mobile handset market is likely to be
driven by the replacement handset market rather than new user additions. The
replacement market is expected to grow from 118 million handsets for the twelve
month period ended December 31, 2010, constituting 62.77% of overall Indian mobile
handset market, to 359 million handsets for the twelve month period ended December
31, 2014, constituting 89.30% of overall Indian mobile handset market.

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Chapter 5:-
Market analysis

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Key players in mobile handset industry
Micromax
Samsung
Nokia (Microsoft)
Lava
Karbonn
Xiaomi
Motorola
Sony
Samsung is still the market leader in Indian mobile handset industry in the 3rd
quarter as per
the International Data Corporation (IDC) with the market share of 16%. Micromax with the
market share of 14% spotted 2nd
position in the selling of mobile handset in Indian handset
industry. Nokia, sold substantially all of Nokia’s Devices & Services business to Microsoft,
spotted at no. 3rd
with market share 11% in the Q3 2014(as per IDC report). Lava remained
at the fouth spot in the country with 10% of market share. Karbonn, another vendor in the
mobile phone industry, at the fifth spot with the market share of 8%.
samsung
16%
micromax
14%
nokia
11%
lava
10%
karbonn
8%
others
41%
Overall market share of different players in
mobile phones Q3 2014
source:- International Data Corporation (IDC)

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Micromax surpassed South Korea's Samsung to become the leading supplier in India's
booming smartphone market for the first time in the fourth quarter, research firm Canalys
Wednesday said. Micromax accounted for 22% of smartphone shipments in India in the
October-December quarter, up from 21% in the previous quarter. Samsung's market share fell
2 percentage points sequentially to 20% in the fourth quarter. Samsung though has previously
denied losing smartphone market share, saying as per its data, it's share is almost double its
closest rival. This performance in Q4 is partly due to Micromax's continuing appeal to mobile
phone users upgrading to smart phones. Canalys' analyst Rushabh Doshi said. He added that
catering to local market preferences will become increasingly important in India. "Micromax
has been quicker than its competitors to improve the appeal of devices, for example, by
including a wide variety of local languages on its Unite phones," he said. The firm said
Micromax's flagship line of products has also very effectively targeted the $150 to $200 (Rs
9,000 to Rs 12,000) segment, with products such as the Canvas Nitro and Canvas Hue.
According to the firm, Karbonn remained at the third spot in the country with 9% market
share, down 1 percentage point in the quarter. Lava, another domestic vendor, saw a drop of
3 percentage points in its smartphone market share to 7% during the quarter. Motorola and
China's Xioami that sell their smartphones device exclusively via Flipkart through the flash
sale models have achieved huge success in the fourth quarter. Motorola and Xiaomi managed
to increase their market shares by 2 percentage points each to 7% and 4%, respectively.
micromax
22%
samsung
20%
karbon
9%
lava
7%
motorola
7%
xioami
4%
others
31%
market share of different players smartphone market
Q4 2014
Source:- The Economics Times

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China's Lenovo, which recently launched the cheapest 4G LTE smartphone in the country,
had 2% market share in the quarter, unchanged over the previous quarter. In total, 21.6 million
smartphones were shipped in India in the period, up from 18.9 million in the thid quarter. The
firm said that total smartphone shipments surged 90% from a year earlier period.
Customer analysis:-
There is an increasing demand for more trendy and easy-to-use products. As people in India
are generally very price sensitive so they are always looking for value for money products
(i.e. higher the benefits and lower the cost so that total value will be more).
Price is the dominant factor affecting the consumer decision to buy mobile phone. Secondly,
the features incorporated in a mobile phone handset are also the most important factor which
is considered by the consumers while purchasing the mobile phone. However, all features of
mobile phones are not equally important.
The other factors equally correlated and have moderate relationships with the decision to buy
are brand name and durability of mobile phones. Both the factors are highly associated with
the quality of mobile phone devices.
The least correlated factors are after sales service and social influences. Providing better after
sales service to customers make them delighted.

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CHAPTER 6:-
Comparative study w.r.t Micromax and Samsung
 SWOT analysis
 STP
 Product life cycle

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 SWOT ANALYSIS OF MICROMAX
 Strengths:
1. Innovative products and features- Marathon battery mobile phones with a 30-day
battery life, a universal remote control phone and gravity phones are some of the
features which have increased the popularity of the product.
2. Low cost of production – With its plants located in China, Micromax bears a low
cost in production due to availability of labour at cheaper rates.
3. Effective promotion campaigns- Micromax has been promoting its products through
famous celebrities and has also had tie ups with MTV.
 Weaknesses:
1. Weak brand image in urban areas- Micromax has still not been able to establish
itself well in the urban market as its main concentration had been on the rural
population.
2. Perception of low-quality Chinese brand- Micromax has a manufacturing unit set
up in china which has strengthened this perception among people.
 Opportunity
1. Increase penetration in urban market- Since Micromax has not yet entered this
market; it has a very huge opportunity to establish itself in this market.
2. Entry into international markets- Micromax has the potential to make its presence
felt on global scale eventually as it establishes itself in the domestic market.
 Threats:
1. Increasing competition from local and international players- With well
established players like Nokia, Samsung, etc Micromax faces a tough
competition from these players.
2. Rapid technological change. Companies are under the pressure to release the
quality products faster and faster effectively and efficiently. The one that cannot
keep up with the competition soon fails. This is especially hard when the business
wants to introduce something new, innovative and successful.

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 SWOT ANALYSIS OF SAMSUNG
• Strengths
1. Hardware integration with many open source OS and software. Samsung is
focused on producing devices which can be integrated with most of the software
and OS. This gives Samsung products an competitive edge over its arch rival.
2. Innovation and design. In 2011, Samsung ranked second on the list of US top
patent assignees. More patents strengthen Samsung position among its
competitors. The firm also won many awards for the design of its products,
proving the superior advanatage over the competitors.
3. Focus on environment. Samsung focuses on producing environment friendly
products that are free from PVC and BFRs (currently only MP3 and mobile
phones). It also develops various recycling programs that are awarded for their
success.
4. Low production costs. The company has set up its production facilities in low
cost countries. This allows producing goods with low production cost and
benefit Samsung as it can offer lower price and earn higher margins.
 Weaknesses
1. Too low profit margin. Samsung Electronics is the largest technology business
in the world in terms of revenues but it has a low gross profit and net profit
margins. Although its smartphones business is quite profitable, Samsung’s profit
margin is low due to its semiconductors sales and aggressive price cuts.
2. Lack in its own OS and software. Software and OS production has a high profit
margin, can increase integration of company’s products and brand loyalty.
Without strong software and OS Samsung is at disadvantage over its
competitors.
3. Focus on too many products. Samsung Electronics serves 4 different industries
with many different products in them. Samsung is at disadvantage over its
competitors because it may loses a focus when competing in too many industries
and too many products.

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 Opportunities
1. Growing India’s smartphone market. India’s smartphone market is one of the
least penetrated among Asia/Pacific countries. Samsung has a strong presence
in India’s market and could use this opportunity to expand its sales.
2. Growing mobile advertising industry. The company could develop
advertising platform for its mobile devices and significantly benefit from this
lucrative market.
3. Growing demand for quality application processors. Samsung is one of the
key manufacturers of application processors for smartphones and tablets. The
growing demand for these products requires more best quality application
processors that only Samsung provide.
4. Obtaining patents through acquisitions. The key to Samsung’s competitive
advantage is the large portfolio of patents. Patents can be discovered by
engaging in costly R&D or through acquisitions of other firms.
 Threats
1. Competition from rivalry. Presence of different numbers of manufacture in
this industry creating threats to the company. Presence of competition facilitate
substitute for the existing products.
2. Rapid technological change. Companies are under the pressure to release
the quality products faster and faster effectively and efficiently. The one that
cannot keep up with the competition soon fails. This is especially hard when the
business wants to introduce something new, innovative and successful.
3. Price wars. Samsung has a very low gross margin on many of its products
and is already selling some of them with significant price cuts. Competitors
could follow price cutting strategy too and induce price wars, which would be
difficult for Samsung to compete because of their low profit margin.

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 SEGMENTATION, TARGETING & POSITIONING
Segmentation:- It is a process of dividing the market into small homogeneous markets.
The marketer’s task is to identify the appropriate number and nature of market segment
and decide which one(s) to target. The major segmentation variables-geographic,
demographic, psychographic and behavioural segmentation.
Targeting:- Targeting involves the process of evaluating each segments attractiveness
and selecting one or more segments to enter.
Positioning:- Positioning is arranging for a product to occupy a clear, distinctive and
desirable place relative to competing products in the mind of the consumer.
MICROMAX
• GEOGRAPHIC:- Rural And Urban Areas
• DEMOGRAPHIC :- Income, Occupation & Age
SEGMENTATION
•Rural people, Youth , Low Income Groups
TARGETING
•Offering value for money products
POSITIONING

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SAMSUNG
Perceptual map
A representation of the consumers’ mind space along at least two dimensions and the
position of brands along these dimensions.
• GEOGRAPHIC:- Rural And Urban Areas
• DEMOGRAPHIC :- Income, Occupation & Age
SEGMENTATION
• Youth , middle class and high class
TARGETING
• Innovative as well as user friendly products.
POSITIONING

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 PRODUCT LIFE CYCLE
Samsung :-
Stages Time Duration
Introduction 2001 - 2006
Growth 2006 - 2011
Maturity 2011 – till now
o In the introduction stage, Samsung introduces the concept phones like
Samsung R220 having antenna externally.
o In the growth stages Samsung came up with the Dual Sim Mobile Phones.
o In the maturity stage Samsung introduces android phones and galaxy series at
affordable price, created point of difference to compete with the major players.
Growth
Maturity
Introducion
Touch screen &
Dual Series
Smart Android Phone
& Galaxy series
Concept Phones
Sales
Time

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Micromax:-
Stages Time Duration
Introduction 2008- 2011
Growth 2012 - till now
o In the early stage of product life cycle i.e. the introductory stage, Micromax focusing
on rural area people and they came up with the dual Sim mobile phones, basic phones
and also introduces Micromax X1i Marathon Battery phone with 30 days stand by and
17 days talk time which is a long battery life phone.
o In the growth stage, Micromax launches tech-savvy or hi-end technology products in
the market such as Canvas series.
Android phones,
canvas series
Growth
Introducion
Sales
Time
Basic phones,
dual sim phones

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CHAPTER 7:-
Analysis of MARKETING STRATEGY w.r.t.
Micromax and Samsung
 Marketing mix (marketing 4 p’s)
 Strategic branding

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 MARKETING STRATEGY OF MICROMAX
Our marketing strategy is to improve the visibility in the urban markets by improving
awareness of customers for our products and also building brand image.
 Product Strategy
On the product side, Micromax has a wide range of phones with different features and thus
offering variety to the customers. Micromax has a lot of interesting and thoughtful products.
Micromax has been able to successfully identify the needs of customers and design products
appropriately. Micromax believes that consumers in India have unique preferences with
respect to mobile handsets such as long battery life, dual GSM capability, low-cost QWERTY
phones, universal remote control and gaming phones. Also, the company has invested heavily
in the product development as of now to capture market share in urban market it is coming
out with new model
Micromax realized that intense competition between telecom service providers forced
customers to maintain two connections, and hence it launched a wide range of dual-SIM
phones, which forms almost 85% of its product portfolio Because people are generally
used to carrying two mobiles – one for professional work and other for personal use. So
dual Sim phones can serve the both the purpose in a single phone.
Android based operating system phones are a proving to be a huge success and a craze
in youth market and professionals because of its vast and new applications. And also office
documents support, push mail etc. also help in satisfying the needs of professionals in a
handy way. So coming out with these phones, they have a huge potential market to work
upon.
Introduction of Tablets again help in serving the advanced technology needs of
professional as it is considered to be almost a substitute of laptop with big screen,
advanced features, etc.
Large buttons based easy to use phones which do not have high features but are useful
to serve the elder age segment as they want ease of use and are at a very low price.
 Pricing Strategy
It’s at the core of Micromax to serve the customers by proving them with lower cost and
value for money products. Thus Micromax adopts penetration pricing strategy in the urban
market because placing their product at a lower cost will serve the purpose and make the

37 | P a g e
customer rethink before buying other competitors product such as Xiaomi, Samsung etc.
which are at a high price segment. So with a lower price we will be providing with almost
same functionality which in turn will help us in gaining a better share in the urban market
as they also want lower prices phones with higher functionalities which has been proved by
our marketing survey.
 Promotion Strategy
The motive of our strategy is to increase our visibility in the urban markets. So making
people aware about Micromax we will incur high promotional expenses. Recently, the
company signed Hugh Jackman as their brand ambassador. Some promotional strategy:-
Hoardings and banners outside colleges, in public places, corporate places and
malls with latest products and updates.
Advertising online which include buying up space in highly browsed sites such as
rediff, yahoo, etc. Also, It has planned to be more active online on Facebook, Twitter
and other social networking sites as it’s a low cost promotion making global presence
and tool having international market. It has planned to improve its visibility by blogs
sites and also on the sites dedicated to reviews and comments of mobile phones.
It is aiming at bundling with telecom providers like Vodafone and Airtel which will
serve as a base in building brand image by associating our names with them.
They have also aimed at higher advertisements through TV, radios, etc which serve
large number of customers.
Better after sales service by providing increased warranty on sales of mobile phones
from 1 year to 2 years. Currently competitors are proving with only 1 year warranty so

38 | P a g e
this will provide us first mover advantage and also create brand image into the minds
of customers.
Sponsoring in the social cause events as customers in urban areas are more aware and
inclined towards companies fulfilling social responsibilities and also it will make
them aware of us and finally building brand image. Introducing exchange schemes
where a buyer can bring in his old mobile phone and get an additional discount of 5%
- 10% on new Micromax mobile phones which would help us in gaining market share
of our competitors.
 Place Strategy
We can place our products in some popular mobile phone retail stores such as Sangeetha,
The Mobile Store, and reliance digital, Croma, etc. they will tie up with local distributors
for easy availability for those who don’t visit popular retail stores or find it easy to purchase
it from nearby stores. We can also sell our phones online by collaborating with Future
Bazaar which is an initiative by Big Bazaar, etc.
Distribution strategy
Firstly, they have business to consumer (B2C) model which follows this hierarchy:
Distributor
Dealer
Retailer
• So under it they offer higher margins to dealers upto 15 %, which is higher than the
industry average of 6-10% at present
• Offering its distributors a higher margin of 5% as compared to 2% of others.
Improved incentives to dealers and distributors will help us in penetrating deeper into
Manufacturer
Distributor
Dealer
Retailer
Customer

39 | P a g e
the urban markets. Thus, making it easily available so as wherever a customer goes to
buy mobile phone he will also be introduced and offered Micromax phones.
Secondly, we have business to business (B2B) model in which we will have corporate
selling through corporate tie ups with major corporate and will be providing them at a
less than market price as we will be saving on the commission to dealers and distributors.
Thus, helping them to reach their target market of professional.
MARKETING MIX OF SAMSUNG
Product strategy
Samsung is offering wide range of quality products and assuring value for money for
their products. Tech-friendly smartphones are offered by the company which are also
user friendly. They are offering variety of features like dual Sim phones, Wi-Fi, music
player, camera, Bluetooth, radio, expandable memory slot 3G, GPS etc.
Their mobile phone lines include Galaxy S phones, Galaxy Note phones, and other
Cell phone versions. The leading phones in the company are the Galaxy S 5 and the Galaxy
Note 3. Listing some products of Samsung mobile handsets.
Tablet smartphone
Galaxy tab 4 231, Galaxy tab s 705, Galaxy tab neo
Smartphone
Galaxy note series, Galaxy s6, Galaxy s6 edge, galaxy alpha, galaxy note edge
Dual Sim Phone
galaxy a7, Samsung z1, Galxy s3 neo, Metro 360, Galaxy star2, Galaxy core 2, Guru
music.
Mutimedia phone
Metro duos
Essential phone
Guru series
corporate selling
Manufacturer

40 | P a g e
Price strategy
Price only the key factor in marketing mix which help the company in generating the
revenue for the them & it is also key success to them. Samsung uses different types
pricing strategy for their products and value for money to the customers for their
products. Firstly, Penetration Strategy for the lower segments. They introduces
Samsung GURU series under this strategy.
Secondly, Samsung also uses Odd Pricing Strategy such as Galaxy tab 3 neo priced at
Rs. 9990, Samsung Guru music at Rs. 1785
Thirdly, they uses Skimming Strategy and introduces galaxy note series.
Lastly, they also uses competitive pricing strategy to compete with their rivalry.
Promotion strategy
The company uses all five elements of promotion; Advertising, Public Relations, Sales
Promotions, Direct Marketing and Personal Selling.
Hoardings and posters are put up in the major cities. Celebrities are invited for the
launch of a new product. In addition, to help promote the global appeal of the brand,
often-famed celebrities like Amir Khan and Priyanka Chopra are made its brand
ambassador. It is usually Samsung’s strategy to use almost 5% of revenue generated
from sales in promotion. Public relations, putting out new releases, writing articles for
trade publications etc. are usually the part of promotional schemes. For the official
launch of Samsung’s latest Wave and Galaxy S, Amir Khan was present in Mumbai.

41 | P a g e
Place strategy
Samsung is headquartered in Seoul, Republic of Korea. It has operational locations in
Korea, the United States, Europe, Asia, Africa, and China. With its network of
subsidiaries and affiliates, it operates in more than 72 countries worldwide with 197
offices.
Distribution network of Samsung
Vendors or supplier
Regional
distribution
centre
Branch warehouse
Direct
dealers
Modern
Retail /
exclusive
stores
Distributors
Sub dealers
Customers
Vendors or supplier

42 | P a g e
 STRATEGIC BRANDING OF MICROMAX
 MICROMAX uses umbrella branding as they are selling their product with the
brand name of Micromax. They are also having sub brands like Canvas for the
Canvas series, BOLT for Bolt series.
 They introduced long battery life phone with 30 days battery back up, Micromax
X1i marathon Battery phone with 30 days stand by and 17 days talk time. The
target market for the product is basically the rural area people due electricity
problem.
 LOGO :-
The new logo of the Micromax is punching from M which denotes crushing
all competition.
Micromax changes its old logo to new
punch logo. The logo is selected from the list of logos submitted by the
participants in creative hunt to revamp logo contest , in association with talent
house india.
USP:-
o Innovation in their products:- created a new category called “Superfone”
with gesture control, powered with 1GHz dual core NVIDIA Tegra 2
processor.
o Moderate/variety of function at low prices.

43 | P a g e
Slogan:-The slogan of Micromax is “Nothing like anything”
Website: - http://www.micromaxinfo.com
The company has their website for the customers to seek related information as
required
EVENTS: - In 2012, Micromax has bagged the title sponsorship for Asia Cup
cricket tournament for the second consecutive year (Micromax Asia Cup 2012.)
 STRATEGIC BRANDING OF SAMSUNG
 Samsung uses umbrella branding as they are selling their product with the brand
name of Samsung. They have also introduced some products with their sub-
brands as Samsung Galaxy for the galaxy series, Samsung Guru for the guru
series phones.
 Events:-
Samsung has agreed to extend its sponsorship of the Olympics Games until
2020, when Tokyo will host the Games. Since 1988, Samsung is in association
with the Olympics.
Slogan:-
The tagline of the company is “inspire the World , create the future”.

44 | P a g e
 Logo:-
The first logo was developed in the year 1958.
2nd
logo of the company (1979-1993)
Samsung logo After 1993
Website:- The company have their website http://www.samsung.com for the
customers to seek related information as required .
USP:- Innovation, user friendly products.

45 | P a g e
CHAPTER 8:-
Findings & Suggestions

46 | P a g e
FINDINGS:-
 Samsung is still the market leader in Indian mobile handset industry in the 3rd
quarter with the market share of 16%. Micromax with the market share of 14%
spotted 2nd
position.
 Micromax surpassed Samsung to become the leading supplier in India's booming
smartphone market for the first time in the fourth quarter with the market share of
22% .Samsung's market share fell by 2% to 20% and spotted 2nd
position.
 In the introduction stage, Samsung introduces the concept phones like Samsung
R220 having antenna externally.
 In the growth stages Samsung came up with the Dual Sim Mobile Phones.
 In the maturity stage Samsung introduces android phones and galaxy series at
affordable price, created point of difference to compete with the major players.
 In the introductory stage, Micromax focusing on rural area people and they came up
with the dual Sim mobile phones, basic phones and also introduces Micromax X1i
Marathon Battery phone which is a long battery life phone.
 In the growth stage, Micromax launches user friendly and hi-end technology products
say Canvas series.
 Micromax using penetration pricing strategy which giving the company a competitive
edge.
 Micromax has recently signed Hugh Jackman as their brand ambassador.
 Samsung uses different types of strategy. Firstly, Penetration Strategy for the lower
segments. Secondly, they uses Odd Pricing Strategy. Lastly, they uses Skimming
Strategy.
 To promote the brand, Samsung signed often-famed celebrities like Amir Khan and
Priyanka Chopra as its brand ambassador.

47 | P a g e
 SUGGESTION AND RECOMMENDATION:-
Instead, Micromax is giving a tough competition to Samsung and become leading supplier of
smartphone and gained 2nd
position in mobile handset industry (smartphone as well as feature
phone) still they were not able to establish them as a global player in the industry. Since the
company is growing through the growth stage then they can still work on their new product
features, increase its distribution channel, can enter into new segments so that they can
maintain their growth stage in the upcoming future also.
Micromax can also do some innovative work in its feature phone segment. Micromax can
introduce some products in the premium segment because they are not having products in that
segment and hence can increase their product range.
Samsung is the market leader in the mobile handset industry while they are fall down to
second position in the smartphone segment, it might be due to high production cost as
compared to Micromax in India. o the company has do some work in R&D so that the cost of
production can be lower down and sold at much cheaper price.

48 | P a g e
ANNEXURE
Bibliography
 On The Study Of Industrial Buying Behaviour(1972, july 10). In Industrial
Marketing Management. Londan And Elsevier Pulishing Company,Printed in
Netherlands
 Sata, M. (2013, October). Factors Affecting Consumer Buying Behavior of Mobile
Phone
 Devices. C.R.Kothari. (2004). research methodology(second revised edition. new age
international (P) limited.
 Armstrong, P. K. (2010). Principles Of Marketing 13th Edition. Pearson, USA.
 Mobile handset sales in India to reach 251 million in 2013: Gartner. (2012, October
11). Retrieved from tech2: http://tech.firstpost.com/news-analysis/mobile-handset-
sales-in-india-to-reach-251-million-in-2013-gartner-47810.
 Voice&Data Survey of Indian Mobile Handsets Market 2012-13. (2013, august 29).
Retrieved June 2014, from Cyber Media:
http://www.cybermedia.co.in/corporate/media-room/194385/voice-data-survey-
indian-mobile-handsets-market-2012
 Indian Retail Industry-Its Growth, Challenge -And Opportunities(2014). Retrieved
from fibre4fasion: http://www.fibre2fashion.com/industry-article/free-retail-industry-
article/indian-retail-industry-its-growth-challenges-and-opportunities/indian-retail-
industry-its-growth-challenges-and-opportunities1.asp
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 www.samsung.com
 www.micromaxinfo.com
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