Project Report on Consumer Electronics-Marketing Dissertation Topic
EXECUTIVE SUMMARY on Consumer Electronics Industry In India
Consumer electronics riding on the path of economic recovery
The consumer electronics industry has continued to expand at a brisk rate due to several factors, such as the retail boom, rising disposable incomes and the availability of easy-to-obtain finance schemes. The industry experienced some effects of recession in the first few months of 2009, but with the recovering global economy and increased consumer confidence in the latter part of the year, the market revived. In particular, dynamic demand was seen after the traditional Diwali celebrations in October 2009.
New models with enhanced features, attractive offers, as well as the easy availability of finance pushed sales of big ticket items such as LCD TVs, laptops, home theatre systems and smart phones in the country.
Technology drives mobile phones, but price still remains key in this sector
Within mobile phones, the evolution of technology, coupled with increased awareness and purchasing power are driving dynamic growth. Advanced features, such as touch screens, dual-SIM, and flash drives are the buzzwords in the Indian market. Instead of being solely cost-conscious, consumers are becoming increasingly technology-conscious, potentially offering those manufacturers with new innovations a guaranteed consumer base for their new launches. However, consumers still want all the advanced features at the lowest possible prices. To keep pace with changing consumer mindsets, companies are focusing on launching technically advanced products at affordable prices. This strategy characterised many new product launches in 2009. Some of the key launches were Samsung Corby, a touch screen smart phone in the price range Rs7,000-8,000, India’s first water proof mobile from Samsung, and a 3-SIM phone by Videocon.
Young consumers look to keep up with the latest fashions in electronics
Consumer electronics products associated with a high-status image are increasing their presence. Rising incomes, growing aspirations, increased awareness and greater exposure to media have encouraged young consumers to spend on such products, which include LCD TVs, home theatre systems, laptops and smart phones. This continues to prompt manufacturers to come up with more high-end products to feed the fast-moving demand among trend-setting consumers, who are willing to upgrade and purchase the latest products, which are perceived to be most desirable.
Continued shift towards organised retail
Traditionally, the Indian consumer electronics retail market was largely governed by the unorganised market, but with large chained electronics stores offering competitive prices, the organised retail channel is gradually gaining strength. Increased numbers of consumers are flowing into large-format electronics stores like Tata Croma and Reliance Digital to experience the multiple brands under one roof. Their large format and world-class ambience is also encouraging consumers to enter the stores.
Strong future growth potential for consumer electronics
Strong economic growth, coupled with increased purchasing power, will continue to drive demand for consumer electronics over the forecast period. Laptops, LCD TVs, DTH and portable media players will continue to be the fastest growing subsectors. Analogue products are not likely to disappear entirely over the forecast period, with some demand from rural areas and tier III cities. Mobile phones will be characterised primarily by replacement demand in the urban market, with rural consumers being the key growth drivers in terms of first-time purchasing.
With rising incomes and technology becoming cheaper, demand for high-end products like Blu Ray players and In-car navigation is expected to pick up in the coming years.
Source: Euromonitor International (2011). Data retrieved March 22, 2011, from http://www.portal.euromonitor.com/
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