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Lg.india

  1. 1. A PROJECT REPORT ONMARKET ANALYSIS OF LG CONSUMER DURABLES & DEALER DEVELOPMENT For LG Electronic Pune Limited 1
  2. 2. Acknowledgement It is indeed of great moment to pleasure to express my senses of per foundgratitude & indebtness to all the people who have been instrumental in makingmy tanning a rich experience. I got the opportunity to do a challenging project inLG ELECTRONIC PUNE (INDIA) The project is the important part of ourstudy and gives us a real practical exposure to the corporate world and it isalmost impossible to do the same without the guidance of peoples in and aroundus. Specifically the summer training of from 2nd of May to 2nd of July that isgenerally termed as the partial fulfillment of our pgp program holds extremeimportance for our whole career. Similarly while doing the topic “MarketSurvey on LG consumer durables & dealer development as a summer traineeI took many my projects in help. It gives me immense pleasure to acknowledge LGELECTRONICS INDIA Ltd., which has been nice enough to give me a chanceto do my summer training and providing me wonderful support through out mytraining period and afterward.I am thankful to MR for allowing me to do my research in his office by knowingmy interest in doing research on LG consumer durables and dealer developmentresearch. 2
  3. 3. I am grateful for his exceptional support for my study throughout these eightweeks. I have learned the meaning of marketing and professionalism from thisgreat personality.I also thank toI would like to take this opportunity to extend my heartfelt gratitude to:)I am also grateful to the Asmita Sawant, RSO, Shop manager, and theDistributor I worked with. The entire experience has been very encouragingand will certainly help me stand in good stead throughout my Career in Future.I also thanks to my project guide for his guidance during my project. I alsothank to my college director Mr. for giving me chance to get such anexperience and giving me chance to get an industrial experience. 3
  4. 4. DECLARATIONI will take pleasure in declaring that the project work that is undertaken by meis an original and authentic work done by me. This project is being submitted Ipartial fulfillment for award of degree of Post Graduate Diploma inManagement fromThe content of this report is based on the information collected by me duringmy tenure at LG Electronics Ltd. at PUNE for two months of training from 2 ndof May to 2nd July 2008 4
  5. 5. Executive summaryIndian Consumer durables market used to be dominated by few domesticplayers like godrej Voltas allwyn and kalvinater. But post liberalization muchforeign company have entered into Indian market dethroning the Indian playerand dominating Indian market the major categories in the market CTV,REFRIGRATOR, AIR CONDTIONERS AND WASHING MACHINE India being the second largest growing economy with huge consumerclass has resulted in consumer durables as the fastest growing industries inIndia LG, SAMSUNG the two Korean companies has been maintaining thelead in the industries with LG being leader in almost all the categories.The rural market is growing faster than the urban market, although thepenetration level is much lower .The CTV segment is expected to the largestcontributing segment to the overall growth the industry. The rising incomelevels double-income families and consumer awareness are the main growthdrivers of the industries.Consumer durables major LG Electronics India Pvt Ltd (LGEIL) will investnearly Rs 500 crore in India this year in research and development, brand-building and other marketing initiatives.The company, having a turnover of Rs 9,500 crore and market share of 26 percent, is investing Rs 360 crore on brand-building and other marketinginitiatives and around Rs 140 crore on research and development, besideslaunching new platforms in information technology and related areas, 5
  6. 6. LG’s innovative ‘211 campaign’ to provide quality after-salesservice, will also be expanded from the existing 22 to 40 cities by next month,The campaign, for which IT infrastructure has been set up, includes thecompany’s response to customer complaint within two hours. The fixing timefor complaints varies from one hour to a maximum of 24 hours. 6
  7. 7. Scope of projectThis project gives me great exposure to the consumer durable market because itincludes product knowledge and the filed job in which I have visited the storecomes under the region of Pune. During this project I also took part in theexhibition of LG which held for the purpose branding and awareness of LGproduct. This project helps me to know the market practically. My job wasduring this project to see the market share and also the display share of the LGproduct in the store. LG always insist the 50% display share of LG productbecause LG believes that “JO DIKHTA HAI WO BIKTA HAI”.My job include while visiting the shops 1. Calculate the display share of the LG product in every shop which comes under Pune region. 2. Collect the data of actual monthly sale of the LG product in every shop. 3. Check the availability of LG catalogue and the POPs in the store. 4. Find out the problems that the dealer are facing while sailing the LG product. 5. Find out the costumer response for the LG product by asking the owner of the shop. 6. Find out the distributer name from whom they purchasing their product and also weather they have direct dealership and which brand. 7. Check that demo calls are attended or not 7
  8. 8. Key findings:- 1. By calculating the display share we found that in most of store LG has 50% display share almost all categories. 2. By the actual monthly sale of particular store we came to know the capacity of the store and how much product can they sale. 3. It helps us to know that weather dealer is capable of being a direct dealer of LG or not and it also helps to find out the new dealer who are capable of being the dealer of LG. 4. We also came to know while visiting the shops that there was big problem of after sale service. 5. Many dealers were facing the problem of after sale service because there is no follow up calls from LG. 6. Demo calls also not done properly. 8
  9. 9. INTRODUCTION Before the liberalization of the Indian economy, only a few companieslike Kelvinator, Godrej, Allwyn, and Voltas were the major players in theconsumer durables market, accounting for no less than 90% of the market.Then, after the liberalization, foreign players like LG, Sony, Samsung,Whirlpool, Daewoo, and Aiwa came into the picture. Today, these playerscontrol the major share of the consumer durables market. Consumer durables market is expected to grow at 10-15% in 2007-2008.It is growing very fast because of rise in living standards, easy access toconsumer finance, and wide range of choice, as many foreign players areentering in the marketWith the increase in income levels, easy availability of finance, increase inconsumer awareness, and introduction of new models, the demand forconsumer durables has increased significantly. Products like washingmachines, air conditioners, microwave ovens, color televisions (CTVs) areno longer considered luxury items. However, there are still very few playersin categories like vacuum cleaners, and dishwashersConsumer durables sector is characterized by the emergence of MNCs,exchange offers, discounts, and intense competition. The market share ofMNCs in consumer durables sector is 65%. MNCs major target is thegrowing middle class of India. MNCs offer superior technology to theConsumers whereas the Indian companies compete on the basis of firmgrasp of the local market, their well-acknowledged brands, and hold over 9
  10. 10. wide distribution network. However, the penetration level of the consumer durables is still low in India. Classification of consumer durables sector1. Consumer electronic include vcd/dvd, home theatre, music player, color television (CTVs), cameras, camcorders, portable audio, Hi-Fi, etc2. White goods include dishwashers, air conditioners, heaters, washing machines, refrigerators, vacuum cleaners, kitchen appliances, non-kitchen appliances, microwaves, built-in appliances, Tumble dryer, personal care product etc.3. Moulded luggage include plastics4. Clocks and watches5. Mobile phones Scope 1. In term of purchasing power parity (ppp), India is the 4th largest economy in the world and overtake Japan in the near future become the 3rd largest. 2. Indian consumer durable market is expected to reach $400 billion by on 2010 3. India has the youngest population amongst the major countries. There are lot of people in the different income categories nearly the two third population is below the age of 35 and nearly 50% is below 25. 4. There are 56 million people in middle class, who are earning us$4,400- US$21,800 a year. And there are 6 million rich household in India. 10
  11. 11. 5. The upper-middle and high-income household in urban areas are expected to grew to 38.2 million in 2007 as against 14.6 million in 2000.Opportunity 1. In India the penetration level of white goods is lower as compared to other developing countries. 2. Unexploited rural market. 3. Rapid urbanization. 4. Increase in income level, i.e.increase in purchasing power of consumers. 5. Easy availability of finance.ThreatsHigher import duties on row materials.Cheap imports from Singapore, China and from other Asian countries. 11
  12. 12. Brands in consumer electronic sectorMNCs NATIONAL REGIONALLG )SAMSUNG ) KOREA ONIDA BUSHHYUNDAI ) VIDEOCON CROWN BPL SALORATCL ) CHINA GODREJ T-SERIESHAIER ) VOLTAS WESTON IFB BELTAKPHILIPS ) HOLLAND OSKARPANASONIC )SHARP )HITACHI )SANSUI ) JAPANAKAI )AIWAWHIRLPOOL )ELECTROLUX TODAY Consumer durables sector is characterized by the emergence ofMNCs, exchange offers, discounts, and intense competition. The market shareof MNCs in consumer durables sector is 65%. MNCs major target is thegrowing middle class of India. MNCs offer superior technology to the LG, SAMSUNG the two Korean companies has been maintaining thelead in the industries with LG being leader in almost all the categories. 12
  13. 13. The company, having a turnover of Rs 9,500 crore and marketshare of 26 per cent, is investing Rs 360 crore on brand-building and othermarketing initiatives and around Rs 140 crore on research and development,besides launching new platforms in information technology and related areas,LG Electronics is one of the leading companies in the field of electronics witha global presence in many countries. . Before briefing, I have divided theintroduction part into three main sub parts. 1. LG Global 2. LG India 3. LG PuneHistory of companyThe company was originally established in 1958 as Gold Star, producingradios, TVs, refrigerators, washing machines, and air conditioners.The LG Group was a merger of two Korean companies, Lucky and Gold Star,from which the abbreviation of LG was derived. The current "Lifes good"slogan is a backronym. Before the corporate Name change to LG, householdproducts were sold under the Brand name of Lucky, while electronic productswere sold under the brand name of Gold Star. The Gold Star brand is stillperceived as a discount brand.In 1995, Gold Star was renamed LG Electronics, and acquired ZenithElectronics of the United States.Global Operation 13
  14. 14. LG Electronics is playing an active role in the world market withits assertive global business policy. As a result, LG Electronics controls 110local subsidiaries in the world with around 82,000 executive and employees.LG Group 1. LG.Philips LCD 2. LG Chemical 3. LG Telecom 4. LG Powercom 5. LG Twins 6. LG DacomBusiness areas and main productsMobile communications (a) CDMA Handsets, (b) GSM Handsets, (c) 3G Handsets, (d) Cellular PhonesDigital appliance a) Air Conditioners, b) Refrigerators, c) Microwave Ovens, 14
  15. 15. d) Washing Machines,e) Vacuum Cleaners,f) Home Net,g) Compressors for Air Conditioners and RefrigeratorsDigital displaya) Plasma TVs,b) LCD TVs,c) Micro Display Panel TVs,d) Monitors,e) PDP Modules,f) OLED Panels,g) USB Memory,h) Flat Panel Computer MonitorsDigital mediaa) Home Theater Systems,b) DVD Recorders, 15
  16. 16. c) Super Multi DVD Rewriters,d) CD±RW,e) Notebook PCs,f) Desktop PCs,g) PDAs,h) PDA Phones,i) MP3 Players,j) New Karaoke Systems,k) Car Infotainment VISION Global Top 3 by 2010 Global Top 3 Electronic/Telecommunication company GROWTH STRATEGY “Fast innovation, Fast growth” CORE COMPETENCY 16
  17. 17. “Product leadership, Market leadership, People leadership” CORPORATE CULTURE No excuse, “we” not “I”, Fun workplaceSLOGAN"Lifes Good" represents LGs determination to provide delightfully smart products that will make your life good. 17
  18. 18. The LG Electronics Lifes Good signature consists of the LG logo,seal, and the slogan, "Lifes Good" set in Charlotte sans typefacecurved around the LG symbol. The curving of the slogan reinforcesLGs personality and uniqueness. The consistent usage of thissignature clearly establishes the unique identity of the company andunifies every division and product from LG Electronics across the globe. THE SYMBOLThe symbol of LG is the face of future. The letter “L” and “G” in a circlesymbolizes world, future, youth, humanity & technology.LG philosophy isbased on humanity. It also represents LG’s efforts to keep close relationshipwith our customers around the world.The symbol consists of two elements. 1. The logo in LG gray 18
  19. 19. 2. The stylized image of human face in the unique LG red color.Red color represents our friendliness and gives a strong impression of LG’scommitment to deliver the best.The circle symbolizes The Globe. The stylized image of a smiling face in thesymbol conveys “Friendliness and Approachability”. The one eye on thesymbol represents “Goal-oriented, Focused & Confident”.The slogan of LG is “Life’s Good”. It expresses “Brand’s Value, Promises,Benefits, Personality. THE PARTNERSHIPLG Electronics chooses to promote harmony and build constructively on alabor-management relationship rather than an employee-employer relationship.This illustrates that management and workers are not in a vertical relationship,but in a horizontal one.This culture is necessary for LG Electronics as it strives to become one of theworlds top companies. Such a relationship is transformed into a value-creationrelationship whereby both parties endeavor to address mutual problems andcreate new values together. 19
  20. 20. STRATEGIC ALLIANCELG Electronics is making technical advances and identifying businessopportunities through various associative relationships with some of theworlds leading companies. LG Electronics is striving to become number one in the world bymingling in various business and technological fields and making strategicalliances with world famous companies. "Strategic association betweencorporations," in which companies with different infrastructures cooperate inthe fast-developing 21st century business field, is of key significance in termsof strengthening the existing industry and creating a new one.LG Electronics will do its best to create new products and services with anopen mind, while developing new technologies and business fields throughvarious associations with some of the worlds most successful companies. 1. 3M 2. SUN 3. YAHOO 4. PHILLIPS 5. TOYOTA 20
  21. 21. 6. MICROSOFT 7. HP 8. GOOGLE 9. GE 10.INTEL 11.NORTEL 12.HITACHI 13.PRADA 14.RENESAS 15.TOSHIBA 16.BESTBUYAnd the number follows many more…………………………..In Feb. 2007 LG Electronics and Yahoo formed a strategic alliance. Yahoomobile services will be available from LG mobile. This service is targeting 10million LG mobile phones in over 70 countries.In Mar. 2007 LG Electronics and Google formed a strategic alliance. 21
  22. 22. Both companies will work together to release, market, and offer LGmobile phones with Google services (search engine, map, email, and blogs.)LG BRAND IDENTITY:-The brand of LG is delightfully smart. LG strives to enhance the customer’slife and lifestyle with intelligent features, institutive functionality andexceptional performance.The brand platform:-The LG brand is composed of four basic elements – 1. Value 2. Promise 3. Benefits 4. PersonalityThe Brands core Value that never changes. a. Trust, b. Innovation, c. People d. Passion 22
  23. 23. The benefits that are consistently delivered to the customer includes Reliable products Simple design Ease of use Extraordinary ExperiencePersonality describes the human characteristic that are expressed to thecustomer through Trustworthy, Considerate Practical, FriendlyThe Internal Culture of LG:LG practices four cultures 1. Learning Culture 2. Boundary less Environment 3. A Carrier 4. Growth 23
  24. 24. According to LG, the Learning Culture continuously helps the employee tolearn more and more to develop the habit of continuous learning.Boundary less Environment means that there is no difference between thelevels of employees. There is transparency between the work and mutualunderstanding between all the employees.A carrier is highly growing in LG and one who is the employee can developtheir carrier largely. A new comer will feel fully comfortable in the companyand for a new comer the company is very helpful in the overall growth ofpersonality.Growth in LG is very high for those who are in the company and for those whowant to join in LG. The company is growing with fast innovation and theBLUE Ocean strategy is one of the examples of growth.MissionThe mission of LG is to provide the customers with utmost satisfaction throughleadership.The fundamental policy of development is to secure product leadership that theCustomers may have the utmost satisfaction. 24
  25. 25. Product LeadershipWe are focusing on six development areas to become the product leader.1. New Machine2. Reliability3. Conventional Installation4. Environment Friendly Product5. Low Noise & Vibration6. Energy Saving Quality Innovation The policy of quality assurance is to provide customers with utmostsatisfaction by supplying zero defects. 25
  26. 26. LG proceeds in a hierarchal manner. It is named as “LG WAY”.From top to bottom:No.1 LG – is the VISION“Jeong-DO” Management is LG’s unique application to ethics. LG willsucceed through fair management practices and constantly developing ourbusiness skill.A) Honest with our customerb) Providing great values to customer through constant innovation & anddevelopment.c) Equal opportunitiesd) Equal Treatment Management Principle - Creating value for customer Code of conduct of LG: 1. Responsibility and obligations to customers : • Respect for Customers • Creating Value • Providing Value • 2 Fair competition • Pursuit of Free Competition 26
  27. 27. • Compliance with Laws and Regulations 3 Fair Transaction : • Equal Opportunity • Fair Transaction Procedure • Support and Aid for Business Partners 4 Basic Ethics for Employees • Basic Ethics • Completion of Duty • Self Development • Fairness in Performance • Avoidance of conflict with company interest 5 Corporate Responsibilities to employees • Respect for human dignity • Fair Treatment • Promoting Creativity 6 Responsibilities to society and country • Rational Business Development • Protection of stock holder interest • Contribution to social development • Environmental ConservationLG INDIA:LG Electronics India Pvt. Ltd., a wholly owned subsidiary of LG Electronics,South Korea was established in January 1997 after clearance from theForeign Investment Promotion Board (FIPB). LG set up a state-of-the art 27
  28. 28. manufacturing facility at Greater Noida, near Delhi, in 1998, withan investment of Rs 500 Crores.LG corporate office is located at Plot no.51, Udyog Vihar, Kasna Road,Greater Noida, India. This facility manufactured Color Televisions, Washing Machines, Air-Conditioners and Microwave Ovens.Company is setting up a chain of exclusive premium showrooms. LG plans tolaunch 60 premium Brand Shoppes by the end of the first quarter of this year.At present, LG has a total of 83 LG stores across the country, of which 45 areshoppes and 38 are exclusive stores. Brand shoppes will be placed in thepremium segment and the target audience will comprise buyers interested inpremium and high end products.LG Brand Shoppe goes beyond the concept of a normal exclusive store byhaving a more interactive environment and additional lifestyle orientation ondisplay so that the customer can actually experience the LG products in his orher own home settings.LG Electronics India Ltd (LGEIL), consumer durables leader with 27% marketshare, is planning a brand new image. To attract inspirational and youngconsumers across India, company will roll out a new marketing strategy. Theexercise will cost the company Rs 360 crore.LG Electronics India is the fastest growing company in the consumerelectronics, home appliances, and computer peripherals industry today. 28
  29. 29. LG Electronics is continually providing, superior technologyproducts & value for money to more than 50 lakh households in India. LGEILis celebrating the 11th anniversary this year.LG Soft India the innovation wing of LG Electronics in Bangalore is LGElectronics largest R&D centre outside Korea. We at LGSI focus on nichetechnology areas such as mobile application development, digital videobroadcast and biometrics software and support LG Electronics with ourexpertise. Motivated by a passion for technology, a strong work culture andloyalty to the organization, we are determined to see LG become one of the topthree brands globally.Prominent consumer electronic company, LG Electronics Inc. has said that itexpects the sale of its products in India to up by 15 per cent in 2008. MoonBum Shin, managing director of LG Electronics India has said that thecompany has earmarked 4.8 billion rupees for investment purpose in India thisyear. The said money will be used to market as well as manufacture newproducts.LG Electronics, which is originally a South Korean Company with branch inIndia, informed that its sales of GSM mobile phones, color televisions, airconditioners and other household goods in the Indian market was to the tune of95 billion rupees ($2.4 billion) in 2007. As per Shins estimate, the sales in2008 would be around 110 billion rupees.In order to achieve its target, Shin said LG Electronics will concentrate oncatering to the high-end consumer market which will help boost sales this year.India churns out six (6) per cent of LG Electronics global revenues of $42billion. The Indian branch of LG exports to 40 countries. India challenges 29
  30. 30. The challenges faced by LG when entered in Indian market 1. Low brand awareness about LG in India. 2. One of the last MNCs entered in India (Samsung, Panasonic entered in 1995 in India). 3. High import duty 4. Compitition from local market players and other MNCs in consumer durable segment. 5. Price sensitiveness of the Indian consumerLGEI over comes these challenges to emerge asInnovative marketing strategy 1. Launch new technologies in consumer electronic and home appliances. 2. LG was the first brand to enter in cricket in big way a way, by sponsoring the 1999 world cup followed it up in 2003 as well. 3. LG brought in four captains of the Indian cricket team to endorse its products. LG invested more then US$ 8 million on advertising and marketing in this sport. 4. LG has differentiated its product using technology and health benefits. CTV has “Golden eye technology” Air conditioner has “Health air system” and microwave ovens have the “Health wave system”.Local and efficient manufacturing to reduce the cost 30
  31. 31. To overcome high import duties LG manufactures TV refrigeratorin India at manufacturing facility at Noida and Pune. LGEI had alreadycommissioned contract manufacturing at Mohali Kolkata and Bhopal forCTVs. This has helped LGEI to reduce cost.LGEI implementing the “Digital manufacturing system” (DMS) as the costcutting innovation this system is follow-up to the six sigma exercise LGEI hadinitiate earlier.R&D potentialLG has the research and development facilities in Bangalore and Pune. Boththe unit carry out R&D department for the domestic as well as the parentcompany it also dose customize R&D for the specific countries to which itexport product.Regional channel and wide distribution network 1. LG has adopted the regional distribution channel in India. All the distributers work directly with the company. This has resulted in quicker rotation of the stock and better penetration into B, C, D, class market. 2. LG also follows the stock rotation policy rather then dumping stock on channel partners.Product localization:- 31
  32. 32. 1. Product localization is the key strategy used by the LG 2. LG came out with Hindi and regional language menus on its TVs. 3. Introduced the low-priced “Cineplus” and “sampooma” for the rural market. 4. LG was the first brand to introduce gaming in TVs in continuations of its association with cricket LG introduce cricket game in CTVsMAJOR KEY SUCCESS FACTORS 1. Innovative marketing - LG was the first brand to enter cricket in a big way, by sponsoring the 1999 World Cup and followed it up in 2003 as well. 2. Local and efficient manufacturing to reduce cost - To overcome high import duties, LG manufactures PC monitors and refrigerators in India at its manufacturing facility at Noida, Delhi. 3. Commissioned contract manufacturing at Mohali, Kolkata and Bhopal for CTVs. 4. Product localization - Product localization is a key strategy used by LG. It came out with Hindi and regional language menus on its TV. 5. Regional distribution model - This has resulted in quicker rotation of stocks and better penetration into the B, C and D class markets. 6. Leveraging India’s IT advantage - LG Electronics has awarded a contract to develop IT solutions to LG Soft India (LGSI). The project involves development and support for ERP, SCM, CRM and IT-enabled services for LG. 32
  33. 33. Strategies adopted by the organizationLG follows 10 commandments which are as follows.1. Foster working environment-5S Environment2. Fast execution is key to success3. Transparent and fast communication-open communication4. Update market -knowledge –Demographics5. Win –Win relationship with the trade partners6. Customer is the king7. Even Billing –Road to ach supplier A8. Be in touch with the market (70% Market, 30% Office).9. Plan and Execute annual marketing Calendar-Time to market10.Display share of 50% -to get 50% consumer share. 33
  34. 34. LG market share of consumer appliances and consumer electronic:-LG position of CTV in various states in IndiaLG position of REF in various states in India 34
  35. 35. LG position of WM in various states in IndiaLG position of AC in various States in India 35
  36. 36. LG position of Audio & Home Theater in various in IndiaLG position of DVD in various in India 36
  37. 37. LG position of MWO in various states in IndiaThis analysis is based on the ORG survey conducted by LG which representthe LG position of different consumer durables in various states in India. Iselect different brand in different category as per the market share and thedemand of product in market. This analysis represents the LG market positionduring the period of March 2008. It shows that LG has captured maximummarket share almost in every category. LG and Samsung have the maximummarket in consumer durable market but LG dominate the almost all thecategory in consumer durable.Prominent consumer electronic company, LG Electronics Inc. has said that itexpects the sale of its products in India to up by 15 per cent in 2008. MoonBum Shin, managing director of LG Electronics India has said that thecompany has earmarked 4.8 billion rupees for investment purpose in India thisyear. The said money will be used to market as well as manufacture newproducts. 37
  38. 38. LG Electronics, informed that its sales of GSM mobile phones, colortelevisions, air conditioners and other household goods in the Indian marketwas to the tune of 95 billion rupees ($2.4 billion) in 2007. As per Shinsestimate, the sales in 2008 would be around 110 billion rupees. In order to achieve its target, Shin said LG Electronics will concentrate oncatering to the high-end consumer market which will help boost sales this year.India churns out six (6) per cent of LG Electronics global revenues of $42billion. The Indian branch of LG exports to 40 countries. Shin remarked thatthe company was targeting an increase of exports to $300 million in 2008 from$230 million in 2007.. 38
  39. 39. LG PUNELG Pune is the branch office of LGEIL. It is located in J.M Road.In 2004 LGEIL opened second factory which is located in Ranjangaon. Thisplant manufactures all product including DVD writers and GSM mobiles. Thusit became first company to manufacture DVD writer in India. The ODP plantaims to reach a manpower base of 1500 people and an investment of Rs 300crore till 2010.LG India will become the export hub for LG Worldwide, catering to theMiddle East and African markets. The company aims to touch an exportturnover of $3 billion by 2010 from India, which will contribute to 30 per centof the Indian arms turnover.Pune, India, October 6, 2004 -- LGE announced 3 growth strategies aimed atthe 1.1 billion people of India making the Indian market the second largestglobal production base following China. Under this strategy LGE has projected2007 revenues in India will exceed US$10 billion, 10 times that of 2004.The three strategies for the Indian market that the global electronics giantdisclosed. included: penetrates the south-western market of India through thenew Pune plant near Mumbai, the second largest city in India, in addition to theexisting northern plant; installs a new GSM handset production line in the newPune plant and uses it as its second-largest global GSM handset production lineafter the Qingdao plant in China; and expands the current 750 R&D staff inIndia to 1,500 by 2007, striving to develop premium products and export 30%of India-manufactured products to Asia, Middle East and Africa markets by2007. 39
  40. 40. LG Electronics’ second new plant in Pune, India covers a total area of 211,200square meters and is currently equipped with a production line to manufacture600,000 TVs and one million refrigerators a year. The company is set to addproduction lines of air conditioners, washing machines, monitors, andelectronic ovens, by 2005.Also, LG Electronics is poised to install a GSM handset production line in thenew Pune plant by early next year. The Pune GSM handset line envisages acapacity of manufacturing 2 million handsets annually, and the companyexpands it to become a global GSM handset production base with a capacity ofan annual 10 million units by 2010.In connection with its three growth strategies for the Indian market, LGElectronics will invest a total of US$150 million in establishing facilities andboosting R&D efforts in India by 2007. Specifically, it will invest US$53million in the Pune second plant, another US$43 million in establishing theGSM line, and US$54 million in securing R&D manpower and boosting otherefforts. Through these strategies, LG Electronics aims to penetrate the globalmarket by using China and India as its core production bases, while operatingits plants in Changwon and Gumi, Korea, as its main production bases. Thisway, the company is pushing to penetrate the global home appliance market.The present capacity of the facility is of 1 lakh unit per year and it shall cater tothe need of the domestic markets. LG plans to upscale its operations to a figureof 2.5 lakh units a year in the near future. The Pune plant in addition to itscurrent manufacturing facility at Greater Noida will enable the company to 40
  41. 41. enhance its consumer reach and reiterate it’s commitment towardsproviding superior technology products to the India consumer.The key strategies being implemented include increasing the number of itsregional offices from six to eight. LG has split its southern regional office intotwo, one comprising the states of Tamil Nadu and Kerala and the otherconsisting of Andhra Pradesh and Karnataka. In addition, it has split one of itsnorthern regional offices by making Uttar Pradesh a separate region afterspinning it out from Delhi NCR. The other four regional offices take care ofEast, Gujarat and Madhya Pradesh, Maharashtra & Goa and Punjab, Haryana& Rajasthan respectively.In the coming year, LG is also repositioning its marketing spends, resulting in asignificant increase in its mass media expenditure for better brand visibility.LG had a marketing budget of Rs 320 crore in 2007 with a 60:40 split in favorof below-the-line activities. Next year, the company plans to increase the shareof mass media even as overall marketing spends would be raised by just about10-15%. 41
  42. 42. LG Pune is the branch office of LGEIL.It is located in J.M Road. The organization structure is –one branch manager, one chief accountant, and area sales manager of CE, HA separate for GSM, Marketing manager for CE, B.M Account SR.BSI ASIM.G I.T.Z.M L.H.D A.M CAC A.M AC AM M.T AMGSM BSI GSM BSI GSM AM DPT 42
  43. 43. HA and separate for GSM.The Pune branch has warehouse atwagoli.Distribution and MarketingThe company has number of dealers and warehouses. They have LG exclusiveshopee. For the marketing of the products a number of activities are followed 1. Exhibitions are conducted from time to time. 2. Society and college activities are conducted. 3. Hoarding, Posters, banners are used so as to grab the attention of the costumers. 4. Day to day advertisement in leading newspaper. 5. Discount at festival time. 6. For dealer relationship they arrange dealer meting at several time in the year 7. LG divide dealer in gold silver etc. category to know the performance of the dealers. 8. They have their sales persons at various sub dealer store and at mordent trade store for particularly for the promotion of the LG product. 9. LG also uses the radio FM for the promotion activities. 10.Also provide capon and scratch card for festive season. 43
  44. 44. The logistics (Supply Chain Management)Visit to warehouse of LG Pune at WagoliLogistics is the art and science of managing and controlling the flow of goods,energy, information, and other resources like products, services, and people,from the source of production to the marketplace. It is difficult to accomplishany marketing or manufacturing without logistical support. It involves theintegration of information, transportation, inventory, warehousing, materialhandling, and packaging. The operating responsibility of logistics is thegeographical repositioning of raw materials, work in process, and finishedinventories where required at the lowest cost possible.Logistics Management is that part of the supply chain, which plans,implements and controls the efficient, effective forward and reverse flow andstorage of goods, services and related information between the point of originand the point of consumption in order to meet customers requirements.5R’s of Logistic followed by LG: 1. Right Time 2. Right Place 44
  45. 45. 3. Right Condition 4. Right Cost 5. Right HandlingLG Pune DistributionLG Pune comes under the western Distribution Region. This region hasfollowing 1. Pune 2. Kolapur 3. Sholapur 4 Satara 5 SangliThe LG Factory is located at NOIDA & PUNE. There are three types ofWarehouse-1. Mother Warehouse2. Branch Warehouse3. Spare part warehouseThe mother warehouse is that where the products from the factory are kept andfrom that warehouse, the products are sent to the branch warehouse.A warehouse is a commercial building for storage of goods. Warehouses areused by manufacturers, importers, exporters, wholesalers, transport businesses,customs, etc. They are usually large plain buildings in industrial areas of cities 45
  46. 46. and towns. They come equipped with loading docks to load andunload trucks; or sometimes are loaded directly from railways, airports, orseaports. They also often have cranes and forklifts for moving goods, which areusually placed on ISO standard pallets loaded into pallet racks.The Pune warehouse is located near Wagoli. It is 13670 sq. feet in area.In warehouse 7 locations is set up for the products. Loc 1, Loc 2, Loc 3, Loc 4 , Loc 5 ,Loc6, Loc 7Loc 1 – sellingLoc 2 - second saleLoc 3 - insurance claimLoc 4 - write off materialLoc 5 – destroy the itemLoc 6 - court case materialLoc 7 - for repair5’s of warehouse, which the LG strictly follow. 1. Sweeping 2. Sorting 3. Systematic Arrangement 4. Simplification 46
  47. 47. 5. Self- disciplineIn warehouse, the products are pinup with 3-color paper to get the knowledgeabout the delivery. 1. Red Card – To stop the product going into market, 2. Green card – To allow the product for delivery in market, 3. Yellow Card – After the product labeled with green, allow this to move in marketDistribution Time:- • Local delivery – 4 hrs. • Upcountry delivery - 12 hrs. • Within 200 km. – 24 hrs. • Beyond 200 km. – 48 hrs.The above distribution time is the time of delivery of products from warehouseto the market place, which the logistic department follows to fulfill the demandin the market at right time. In LG, we have the following process, which isfollowed in logistic through ERP. • Order Processing • Invoicing • Indenting • Report 47
  48. 48. Order Processing booking for dealers /distributorsInvoicing after billing process/bill generationIndenting requirement (Pdt Unit to branch unit)Report distributed to allIn warehouse, there are two mode of dispersion of product from one place toanother within. a) Hydraulic b) ManualIn addition, there are 35 fire extinguishers to prevent the accidental hazardwithin the warehouse due to fire. These fire extinguishers are valid up to year2011. One has to follow the rule of “NO Smoking” within the warehouseLogistics Ten Commandments – Golden Rules1 - Warehouse 5S – to be strictly followed – FG – 2, 5 & 7 to be properlymaintained.2 - 100% Bar-coding for all inward & outward transaction.3 - Follow standard pick – ship process religiously.4 – No inventory mismatch, shortage or excess – monthly 100% physicalstocktaking.5 – Nil 30+ for FG – 2, 3 & 5.6 – Nil transit damage. 48
  49. 49. 7 – File insurance claim within 2 days. Settle all claim all within 30days.8 – No inter – branch transfer without HO clearance.9 – PSI feeding into system by 25th of every month. Ensure 90% accuracy.10 – Apply physical FMFO. Problem 1- In transit material damage checking. 2- Cost target achievement. 3- Natural events tracking. 4- Fluctuation in demand-supplyEquipments 1- 100% Bar code scanner. 2- ERP – Invoice Generation Process. 3- Hydraulic Trolleys for material movement. 4- Pallets for safety of material. 49
  50. 50. WAREHOUSE WITH THE EQUIPMENT. 50
  51. 51. WAREHOUSE: REFRIGERATOR AND CTV SECTION CUSTOMER SERVICEThe best and the biggest international brands are here in India –but the irony ifit all: where is the after-sales-service? So integral to a brand, so critical for itssuccess and so taken for granted in developed markets! In India, after salesservice is, for want of a better description, the pits. So what’s stopping the bestcompanies from pulling out all the stops when it comes to providing the bestservice? Do customers expect for too much? Or is it that in India they don’treally care. Brand Equity fanned out to MNC as well as Indian consumerdurable companies, stockiest and dealers, analysts and market researchers toget a feel of what’s really keeping after sales from being used as a cutting edgemarketing tool in pushing products across categories.Customers support following the purchase of a product or service. In somecases, after-sales service can be almost as important as the initial purchase. The 51
  52. 52. manufacturer, retailer, or service provider determines what isincluded in any warranty (or guarantee) package. This will include the durationof the warranty traditionally one year from the date of purchase, butincreasingly two or more year’s maintenance and/or replacement policy, itemsincluded/excluded, labor costs, and speed of response. In the case of a serviceprovider, after-sales service might include additional training or helpdeskavailability. Of equal importance is the customers perception of the degree ofwillingness with which a supplier deals with a question or complaint, speed ofresponse, and action taken.LG also had a big problem of after sale service in India. During my project Ialso came to know that after sale service becomes the big issue in Pune region.Customers as well as dealer were facing the problem of after sale service.Because of this problem many dealer in Pune region were not ready to sale LGproduct. So it becomes the big issue.But LG has taken some solid steps towards improving customer’s perceptionand experience of after sales service. Because it very important in competitivemarket to provide the best service.L G Electronics has signed a memorandum of understanding with 23 IndustrialTraining Institutes to strengthen its after sales service in India. 52
  53. 53. The company aims to recruit 10,000 people by the end of this yearas a part of its branding strategy to focus on service and move away fromdiscounting.L G Electronics has identified eight states with high after sales service callrates to ink the deals with the ITI. Y V Verma, director HR and managementsystem, LG Electronics said, "The Company was trying to find a solution foreffective after sales service since last two years. There is a huge need of trainedmanpower for the after sales service to align with the companys expansion andfocus on the GSM mobiles and the personal computer segments." 1. In the initial phase the company has entered into agreements with ITIs in the states like Maharashtra, Gujarat, Delhi, Punjab, Assam, and Karnataka and is in the last leg of signing with Uttar Pradesh. 2. L G Electronics, with 1200 service centers, has already recruited 300 students and plans to beef up the number to 10,000 by the year-end. 3. "The company has offered a scholarship to the selected students for the last six months of their training programme," 4. The company will invest Rs 8 crore (Rs 80 million) in employee development programme this year with an aim to attain a 8 per cent attrition rate. 53
  54. 54. 5. The company moved away from the discounting strategy since last year and is putting thrust on the quality and service in its brand communication to position LG as a premium consumer electronics brand.6. At the top, the Service Division in Korea reports to the Global CMO. (as mentioned in Dermot’s public interview in ET on Wednesday). This shows commitment that Service must be made into a marketing differentiator, and leveraged thus.7. LG has the widest service network across the country; some estimates put it at a significant multiple of service-infrastructure from our nearest competitor. While the sale size may also be a nice multiple from nearest, it shows the company is ready to put our money where our mouth is.8. The company has introduced a 211 service - once you register your complaint, we will call you back in 2 hours (hence 2), set up an appointment for the next convenient day for you (hence the first 1), and show up in the promised 1-hour slot (hence the second 1). If the next convenient day for you is the next day, that’s great too. It’s a disruptive action in an industry (including LG) having traditionally shied away from its service responsibilities, and thus not leveraging any mileage from it. 54
  55. 55. 9. The company is promoting 211 through ATL, probably the first time after-sales service is being communicated in this fashion by any product company. You may have seen the TV commercial or heard the radio advert or seen the newspaper ad or in-shop posters, both of which revolve around prompt response. 10.The first LG-owned service centre opened in Gurgaon. (Service in India generally works through authorized service centers, in LG’s case they work exclusively for LG.) A company-owned service centre tries that much harder, knows things better, and can even contribute as a revenue center.CONSUMER SURVEY DURING EXHIBITIONFrom 16th to 25th May a consumer exhibition was organized at the college ofEngineering ground. The exhibition was sponsored by Sakal group in whichnumber of companies participated. 55
  56. 56. EXHIBITIONS PICTURES SHOWING THE PRODUCTS Objective of the projectPrimary objective Find out the positional dealer who can sale the LG product in large volume. 56
  57. 57.  The main objective of research was to identify potential dealer and development these dealer. So LG can make them their direct dealer. This will ease the dependence on the some big dealer like Maharashtra and Mahaveer electronics. Find out the problem faced by the dealer in sales and the distribution.Secondary objective  The Objective was to find out that how far the exhibitions are helpful in branding,  While purchasing the consumer durables which parameter is most important for the consumer?  Do the consumers prefer the financial facility for buying consumer durable?  How frequently consumers change the consumer durable?  To enhances the knowledge of consumer durable market.  To increases the knowledge consumer durable product of LG.  To enhances the knowledge about the marketing and branding activity. Research Methodology: Research methodology is considered as the nerve of the project. Without a proper well-organized research plan, it is impossible to complete the project and reach to any conclusion. The project was based on the survey 57
  58. 58. plan. The main objective of survey was to collect appropriate data, which work as a base for drawing conclusion and getting result.Therefore, research methodology is the way to systematically solve theresearch problem. Research methodology not only talks of the methods but alsologic behind the methods used in the context of a research study and it explainswhy a particular method has been used in the preference of the other methodsResearch design:Research design is important primarily because of the increased complexity inthe market as well as marketing approaches available to the researchers. In fact,it is the key to the evolution of successful marketing strategies andprogrammers. It is an important tool to study buyer’s behavior, consumptionpattern, brand loyalty, and focus market changes. A research design specifiesthe methods and procedures for conducting a particular study. According toKerlinger, “Research Design is a plan, conceptual structure, and strategy ofinvestigation conceived as to obtain answers to research questions and tocontrol variance.Types of research is:• Descriptive Research 58
  59. 59. The type of research adopted for study is descriptive. Descriptivestudies are undertaken in many circumstances when the researches is interestedto know the characteristic of certain group such as age, sex, education level,occupation or income. A descriptive study may be necessary in cases when aresearcher is interested in knowing the proportion of people in a givenpopulation who have in particular manner, making projections of a certainthing, or determining the relationship between two or more variables. Theobjective of such study is to answer the “who, what, when, where and how” ofthe subject under investigation. There is a general feeling that descriptivestudies are factual and very simple. This is not necessarily true. Descriptivestudy can be complex, demanding a high degree of scientific skill on part of theresearcher.Descriptive studies are well structured. An exploratory study needs to beflexible in its approach, but a descriptive study in contrast tends to be rigid andits approach cannot be changed every now and then. It is therefore necessary,the researcher give sufficient thought to framing research.Questions and deciding the types of data to be collected and the procedure tobe used in this purpose. Descriptive studies can be divided into two broad 59
  60. 60. categories: Cross Sectional and Longitudinal Sectional. A crosssectional study is concerned with a sample of elements from a givenpopulation. Thus, it may deal with household, dealers, retail stores, or otherentities. Data on a number of characteristics from sample elements arecollected and analyzed. Cross sectional studies are of two types: Field studyand Survey. Although the distinction between them is not clear- cut , there aresome practical differences, which need different techniques and skills. Fieldstudies are ex-post-factor scientific inquiries that aim at finding the relationsand interrelations among variables in a real setting. Such studies are done inlive situations like communities, schools, factories, and organizations.Another type of cross sectional study is survey result, which has been taken byme. A major strength of survey research is its wide scope. Detail informationcan be obtained from a sample of large population .Besides; it is economical asmore information can be collected per unit of cost. In addition, it is obviousthat a sample survey needs less time than a census inquiry. Descriptive researchincludes survey and fact finding enquiries of different kinds of the majorpurpose. Descriptive research is description of the state of affairs, as it exists atpresent. The main characteristic of this method is that the researcher has nocontrol over the variables; he can only report what has happened or what ishappening. The methods of research utilized in descriptive research are surveymethods of all kinds including comparative and co relational methods. Thereason for using such needs to be flexile in its approach, but a descriptive studyin contrast tends to be rigid and its approach cannot be changed ever now andthen.DEALER MANAGEMENTMapping of Pune region dealers. 60
  61. 61. In Pune region there were total 180 dealers including the upcountry side They have been divided into three categories on the basis of theirturnover and the selling capacity.  PUNE -1  PUNE-2  PUNE-3 PUNE BRANCH PUNE 1 PUNE 2 PUNE 3PUNE-1 Includes the modern trade and they have direct billing from thebranch office. They have high turnover and the company depends heavily onthemPUNE-2 includes the distributors. They have direct billing from the branchoffice.Their turnover is also high.PUNE-3 Includes the sub dealers .They have direct billing from distributors orfrom the branch office. Their turnover is not so high, but there are few subdealers whose potential is quite high. According to sales the branch hasdesignated as gold and silver sub dealers.OBJECTIVE OF THE STUDY 61
  62. 62. The objective was to find out the market share of LG products,advantages, and disadvantages of LG products from dealers and to find outwhat problems they are facing with the LG products so that problems can beresolved to increase the sale. PICTURE SHOWING THE PRODUCT OF LG IN ONE OF THE SHOP 62
  63. 63. Data collection methods:After the research problem, we have to identify and select which type of data isto research. At this stage; we have to organize a field survey to collect the data.One of the important tools for conducting market research is the availability ofnecessary and useful data.Primary data: For primary data collection, we have to plan the following fourimportant aspects.  Sampling  Research Instrument  Secondary Data - The Company’s profile, journals and various literature studies are important sources of secondary data.  Data analysis and interpretation 1. Questionnaires 2. Pie chart and Bar chartQuestionnaires:This is the most popular tool for the data collection. A questionnaire containsquestion that the researcher wishes to ask his respondents which is alwaysguided by the objective of the survey.Pie chart:This is very useful diagram to represent data , which are divided into a numberof categories. This diagram consists of a circle of divided into a number ofsectors, which are proportional to the values they represent. The total value isrepresented by the full create. The diagram bar chart can make comparison 63
  64. 64. among the various components or between a part and a whole ofdata.Bar chart:This is another way of representing data graphically. As the name implies, itconsist of a number of whispered bar, which originate from a common baseline and are equal widths. The lengths of the bards are proportional to the valuethey represent.Preparation of report:The report was based on the analysis and presented with the findings andsuggestions. The sample of the questionnaires is attached with the report itself.Sampling Methodology:Details of the sampling methodology, I have made questionnaire. The one ismade for the Customer.No. of questions in questionnaires for customer: 07No. of question related to LG product: 03No. of people met during the research: 200No. of respondents during the research: 50Sample unitProfessionals, Business man,Employees, House wife,Working women, Students 64
  65. 65. Analysis:Q1. Have you purchased any consumer durable during Exhibitions?  Yes  NoInferences 1. 65 % of Customer have not purchased any consumer durable from exhibitions. 2. Only 35 % people have purchased. 3. It shows that consumers are coming in the exhibition for knowledge of product and also they want to know that weather there is actual price difference in exhibition and shop or not. 4. Consumer also want to compare to the different brand which are available in the exhibition. 65
  66. 66. 5. So exhibitions are more useful to increases brand awareness. 6. People are less interested to purchase product from the exhibition.Q.2While purchasing consumer durable which parameter influences you?  Price  Product feature  Brand  Service  DurabilityInference 1. 30% of customer gives importance to price. So it shows that Indian consumers are very price sensitive. They give more importance to price over the brand. 2. 26% give importance to brand. So price and Brand matter a lots for the costumers. And they are also want best brand in best price. 66
  67. 67. 3. 19% to product feature Service 16% and durability 9% Service is also a big factor for the customer they are less interested in the durability.Q3. From where you prefer buying consumer durables  Exhibitions  Co.shoppee  ShowroomInference: 1. A majority of customers prefer to buy from showrooms. Very less proposition of customers buys from Exhibitions. 2. 47% customers are prefer to by from the showrooms because the showrooms are more convenient to customers they also think that these shops give more discounts. 3. People are less interested to buy from the exhibition they only visit the exhibition for price quotation of the product and the comparison of the product. 67
  68. 68. Q.4.You prefer to buy from the same as you have mentioned in Q.3 because offollowing reasons  Attractive Price  Service  Demonstrations  OffersInference 1. Customers buy from showrooms because of the service and convenience. These are two main factors. 2. Customers are preferred to buy from the showroom because of they think that these convenient store may provide good after sell service. 3. Customer also thinks that there is more chance to bargain and they can get more discounts in these showrooms. 68
  69. 69. 4. Price also a factor that attract the customer in these showrooms.Q.5.Which consumer durable you have and of which brand?  CTV  LCD  PLASMA  REF  WM  MW  AC 69
  70. 70. InferenceIn CTV section maximum customers have Onida, in LCD Sony is the leader, Inplasma BPL is the leader, In Ref LG is the leader, MW LG is the leader. InWM there are companies and in AC also.Q.6. How frequently you change your consumer durables?  1-3 years  3-5 years  5-10 years  More than 10 yearsINFERENCE 70
  71. 71. 1. Customers prefer to change consumer durables within 5-10 years. In India people do not change consumer durable frequently. 2. 23% customers do not change their consumer durable within 10 year. 3. It represent that Indian consumer do not prefer to change their consumer durable frequently.Q.7.Do you prefer any financing scheme to purchase consumer durables?  Yes  NoINFERENCEMajority of customers do not prefer any financial scheme. 71
  72. 72. Dealer survey Findings 1. By calculating the display share we found that in most of store LG has 50% display share almost all categories. 2. By the actual monthly sale of particular store we came to know the capacity of the store and how much product can they sale. 3. It helps us to know that weather dealer is capable of being a direct dealer of LG or not and it also helps to find out the new dealer who are capable of being the dealer of LG. 4. We also came to know while visiting the shops that there was big problem of after sale service. 5. Many dealers were facing the problem of after sale service because there is no follow up calls from LG. 6. Demo calls also not done properly. 72
  73. 73. 7. The top competitor of LG product in Pune is SAMSUNG. 8. In Pune area the performance of LG is in better position but the competitor also hold closer margin. 9. There is high growth of sale in market due to booming in new technology and better service. 10.Word of mouth plays a vital role in awareness among customer. This is one factor, which can play a good role in promotion of products as well as demonstration given by the shopkeeper also plays a vital role for customer.RECOMMENDATIONS AND SUGGESTIONS 1. LG should improve it’s after sale service because its hits badly LGs market share in Pune region. 2. More detailed customaries service is to be provided. 3. The training to in shop demonstration should be given at frequent time interval and feed back should be considered positively. 4. The company should look into the matter of person hiring for in shop demonstration. A big LG showroom should have at least 2 such kind of person. 5. LG should try new dealer who have the potential. So they can target more market. 6. As there is a bottle neck competition between Samsung and LG, it is necessary to take measure steps to overcome the area of downfall in LG with respect to Samsung. 7. The marketing managers should make better relations with dealers and reputation of the company. 73
  74. 74. 8. Customer considers quality as their first preference, so the company should give more stress on this.9. The switching of customer from LG product to other brand is due to the bed after sell service in shop.10.The product is well aware and it is on top of mind of customer. So company should always improve services and update their technology. CUSTOMER SURVEY FINDINGS1. Secondary supports play an important role in the customers mind and create awareness among the customers. The secondary support includes Demonstration, Exhibition & Even Sponsors.2. From the survey it was found out that the majority of customers don’t buy consumer durables from exhibitions. They just visit the exhibitions to see the co. latest model.3. They want to buy from the showrooms or from co. showrooms. For them service is important .Beside convenience and other factors service is key factor.4. Also majority of customers do not want any financing scheme for purchasing the durables.5. There was heavy rush on weekends so large numbers of ISD’s were appointed that day. Also the live demo calls helps in selling. Exchange offers also generate sale. 74
  75. 75. 6. Customers are also now very choosy in buying the product and it is important for the company to make loyal customer of their brand. 7. In survey we found that LG has captured maximum market share in every category. LG dominates CTV, LCD, and Refrigerator, and Washing machine, category. 8. LG and Samsung have bottle neck competition in TV and REF. category. 9. The product is well aware and it is on top of mind of customer. 10.Customers are also now very choosy in buying the product and it is important for the company to make loyal customer of their brand.RECOMMENDATIONS AND SUGGESTIONS 1. Exhibitions do not help to generate so much sells but they should be conducted regularly. This helps in generating awareness regarding the product in customers which ultimately helps in sales. 2. Also it is helps in advertising for the new products. Like in this exhibition new LCD SCARLET was advertised. Company should always focus on service. 3. Display share should be increased where there is less than 50% as LG also believes that “JO DIKHTA HAI WO BIKTA HAI”. 75
  76. 76. 4. Company should try to improve service. No doubt the company products have technically edge over competitors but in long run it may hamper the company’s profit. 5. Company should concentrate more on its major drivers LCD, IT, and GSM. Branding and promotions should be done effectively as it creates a long lasting image in the mind of customers. 6. Company should also cater to the needs of sub dealers as some of the sub dealers have potential of high sales. LIMITATIONSEvery study has certain limitations. In my study, also there were certainlimitations, which I could not able to solve. 1. The research was conducted in a very small area. 2. My research work period witness the biggest ups and downs in product sale of different brands, which affected the perception of the customer. This was biggest drawback of my study. 76
  77. 77. 3. Time factor was also important for me. I had only 60 days to complete my research, for which a full-fledged report was insufficient for me. 4. The customer filled the questionnaire mostly in careless manner, so it was difficult to make them hold for time. 5. I had only found the upper-middle class family to fill up the questionnaire, but generally, an average middle class family was required for the study. 6. The sample size is also very small which represent my research on consumer behavior My study is not recognizable in whole INDIA as well as outside Ranchi due to the above limitations and less area coverage.BIBLIOGRAPHY  www.lgindia.com  www.google.com  www.wikipedia.com  Business world  Business today 77
  78. 78.  LG magazine  Economics times News paper  Times of India Consumer survey QuestionnaireQ1. Have you purchased any consumer durable during Exhibitions? a) Yes b) NoQ.2While purchasing consumer durable which parameter influences you? a) Price 78
  79. 79. b) Product feature c) Brand d) Service e) DurabilityQ3. From where you prefer buying consumer durables a) Exhibitions b) Co.shoppee c) ShowroomQ.4.You prefer to buy from the same as you have mentioned in Q.3 because offollowing reasons a) Attractive Price b) Service c) Demonstrations d) Offers e) ConvenienceQ.5.Which consumer durable you have and of which brand? a) CTV ------------------- b) LCD ------------------- c) PLASMA ------------------- D) REF ------------------- E) WM ------------------- 79
  80. 80. F) MW ------------------- G) AC -------------------Q.6. How frequently you change your consumer durables? a) 1-3 years b) 3-5 years c) 5-10 years d) More than 10 yearsQ.7.Do you prefer any financing scheme to purchase consumer durables? a) Yes b) No APPENDIXA.S.I Area Service In chargeA.S.M Area sales managerB.S.I Branch Service In charge 80
  81. 81. CAC Commercial Air Conditioning SystemC.S NET Customer Service NetD.S.C. Direct service centre.L.H.D Logistics Head of departmentR.E.F Refrigerator 81

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