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Micromax Marketing Plan

1.Abstract
In this project work, we seek to devise a marketing plan for Micromax Mobiles. Micromax Informatics
operates in consumer electronics industry. The company manufactures Computers & Peripherals and
Portable Consumer Electronic Devices. Smart Phones come under Portable Consumer Electronics
Devices. Few key facts:
1. This company was established in the year 2000 as a software firm, headquartered at Gurgaon.
2. It later entered into mobile phone market in the year 2008.
3. The market share in 2010 was 4.1%.
4. As of now, holds the 2nd position in Indian Mobile market from market share perspective.
Micromax started as a small player in this highly competitive domain and went on to become 2 nd largest
mobile manufacturer. The current market stands at 15.7%. The largest firm in this domain is Samsung,
whose market share is 21.1%. Micromax has reached this position by overtaking major MNC Brands
such as Nokia, LG, and Sony etc. It also faces cut throat competition from home grown companies such
as Karbonn, Lava etc. According to the report released by Gartner, Micromax occupies the 11th position
for maximum phone sales to end users in 2014 worldwide with a market share of 2%.
This abstract discusses a feasible marketing plan for Micromax Mobiles. It has already seen a meteoric
rise in Indian mobile market. For this project plan, we will consider the set of smartphone offerings from
Micromax and analyse how we can use marketing strategies to help it climb further in the race.
The major competitors of this company can be listed as below:
Ran
k
1

Samsung

Ran
k
7

Micromax

LG

14

Karbonn

Spice

15

Apple

21

4
5

Lava
Intex
Microsoft
Corporation
(Erstwhile Nokia)

10
11

Sony
Celkon

16
17

ZTE
HTC

22
23

12

Maxx
Moblink

18

Lenovo

Firm

Firm
Gionee

Ran
k
13

Firm
Xiaomi
Videoco
n

Ran
k
19
20

Firm
Huawei
Blackberry
(RIM)
Motorola
Mobility
Oppo
One Plus

Micromax's strategy has always been to deliver the right value at the right price. The company targeted
the middle class segment by offering feature rich mobiles at a lower price when compared to the other
similar phones in the market. Micromax maintains high product differentiation with a large range of
mobiles in the market. The company customizes its products as per needs of the target customer. For
example, smartphones with camera, good battery life and 3g connectivity for college youth.
Initially Micromax became more popular in the rural market, but then Micromax targeted the urban
market by launching feature rich flagship models at a lower price. In 2014 Micromax signed a contract
with Hugh Jackman to promote its flagship products, which was a first for an India mobile brand. The
company has been able to build its brand name and market size based on such and other strategies
such as sponsoring cricket matches. Its tag line-Nothing like anything reflects the uniqueness of all its

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Micromax Marketing Plan

products. The company has been able to keep up with rapidly evolving mobile phone market with its
innovations. The products reflect these innovations and the rapidly growing market share is an evidence
for the same. The company also has its major operations based out of India and has performed better
than several established global brands in the Indian market. The target of the Micromax is to be mobile
market leader in India in coming days through introducing new smart phones with higher technical
specifications keeping the price low at the same technology range.
We intend to dive deeper into the company philosophy and marketing strategy. This would enable us to
come up with a marketing plan/strategy. The aim of our marketing strategy is to maintain & better its
YoY growth in terms of market share and revenues, eventually leading it to the first place in the mobile
market.

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Micromax Marketing Plan

2.Situational Analysis
2.1. Product and the Competitors
In this project work, we seek to devise a marketing plan for Micromax Mobiles. Micromax Informatics
operates in consumer electronics industry. The company manufactures Computers & Peripherals and
Portable Consumer Electronic Devices. Smart Phones come under Portable Consumer Electronics
Devices. Few key facts:

This company was established in the year 2000 as a software firm, headquartered at Gurgaon.
It later entered into mobile phone market in the year 2008.
The market share in 2010 was 4.1%.
As of now, holds the 2nd position in Indian Mobile market from market share perspective.

Micromax started as a small player in this highly competitive domain and went on to become 2nd
largest mobile manufacturer. The current market stands at 15.7%. The largest firm in this domain is
Samsung, whose market share is 21.1%. Micromax has reached this position by overtaking major MNC
Brands such as Nokia, LG, and Sony etc. It also faces cut throat competition from home grown
companies such as Karbonn, Lava etc. According to the report released by Gartner, Micromax occupies
the 11th position for maximum phone sales to end users in 2014 worldwide with a market share of 2%.
The major competitors of this company can be listed as below:
Ran
k
1

Samsung

Ran
k
7

Micromax

LG

14

Karbonn

Spice

15

Apple

21

4
5

Lava
Intex
Microsoft
Corporation
(Erstwhile Nokia)

10
11

Sony
Celkon

16
17

ZTE
HTC

22
23

12

Maxx
Moblink

18

Lenovo

Firm

Firm
Gionee

Ran
k
13

Firm
Xiaomi
Videoco
n

Ran
k
19
20

Firm
Huawei
Blackberry
(RIM)
Motorola
Mobility
Oppo
One Plus

However, for the comparison purposes, we would mainly consider Samsung Mobiles from Samsung
Electronics.

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Micromax Marketing Plan

2.2. Category Analysis

2.2.1.

Aggregate Market Factors

a) Market Size:
Market size by number of handset sold
In terms of no. of mobile handset sales in India the current market size in 171838900 units. Among
these units the majority consists of Android Mobile handsets.

Source: Euromonitor

Market size by Distribution

Sales of Mobile handset occur through bellow mentioned Distribution channels. Major market for mobile
handset is the electronics and appliances specialist retailers with 81% followed by Internet retailing
with 14%. Consumer prefer to buy handset from electronics and appliances specialist retailers from
which it can be inferred that the consumer want to physically feel the handset which stratifies their
need.

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Micromax Marketing Plan

Market Share by Companies in 2015

In terms of market share Samsung Corp has the highest market share of 21% followed by Micromax with
16% and karbonn Mobiles India pvt ltd with 9%.

RELATIVE MARKET SHARE: MICROMAX SHARE/ (LARGEST COMPETITORS MARKET SHARE) =

12/ (21) = 0.5714 = 57.14%
b) Growth
The below mentioned stats proves that volume of mobile handset in India for the period 2011 to 2015 ,
had grown till 2013 then there was decrease in the volume of mobile sold in 2014 t0 2014. Micromax
volume i.e. Number of handset sold in 2015 fell as compared to 2014. The same trend was scene in
Retail value of mobile phone sold. Micromax growth in 2013 was predominately because of 3G enabled

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Micromax Marketing Plan

less costly android mobile phone. Smartphone market is changing from high end phone to low cost
feature rich mobile phones. Micromax mobile growth is because it has introduced variety in mobile
phone both in featured and smartphone.
Industry Growth:

Retails Value:

Micromax Mobile Volume:

Micromax

Mobile

Retail Volume
CGAR
YOY GROWTH

2010
6163402.

2011
1264451

2012
1425025

105.15%

2013
2912654

4
34.351%
12.70%
104.39%

2014
3089332

2015
2697870

6.07%

-12.67%

c) Replacement Cycle:
The Replacement cycle in India changed with the introduction of smartphone i.e. from 2010 to 2011.
Technological change in mobile handset, introduction of smartphone with internet service changed the
replacement of mobile phones in India. Over the period from 2012 to 2014 mobile phones were android
based phones so consumer didnt go to replacement so we see a flat trend in replacement cycle.

Source : Euromonitor

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Micromax Marketing Plan

e) PROFIT:
Micromax Informatics has posted profit since its inception, the profit registered is primary due to
increase in the sale of affordable mobile phone. Micromax offered variety of phones both in Featured
and smartphone segment with low to affordable price range.

Micromax faced competition with

Samsung mobiles in both segments. Micromax focused it target consumer to youth segment (Low
disposable Income segment). Youth segment wanted affordable smartphone with maximum features
like internet connectivity, camera etc. It promoted products two tier, 3 tier and rural areas of India.
-Profit is due to low cost of manufacturing, manufacturing plants in china and availability of cheap labor.
-Large scale promotion of mobile phone though famous celebrity like Hugh Jackman and through TV
channels like MTV, both of which are targeted for youth segment.
-Micromax mobile handsets doesnt use very high end components as used by premium mobile
manufactures like Samsung, LG.

f) STAGE IN PRODUCT LIFE CYCLE

Product life cycle can be predicted to the basis of BCG Matrix. Different products manufactured by the
company can categorized on the basis of Relative Market Size and Market Growth. We have assumed
product instead of SBU.
A product life cycle in a market can be pictured as
QUESTION MARK STAR CASH COW DOG
(Introduction)

(Growth)

(Maturity)

(Decline)

Introduction Stage: Entry into high growth with low market share aiming to create awareness and
develop market for product. Micromax entered into the market in the year 2008, Micromax target
consumer demographic was the Indias youth. With affordable price and feature like dual sim phone it
heavily promoted its brand with endorsing movies stars like Akshay Kumar.
Growth Stage: Micromax was able to source and work with OEM partners to offer cost-competitive
products as Indian consumers do not buy subsidised phones as part of mobile contract. The companys
cost-competitive phones will be attractive in other emerging markets as consumers in these markets
will be price sensitive, hence willing to try new brands. Micromax has now become the 2 nd highest

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Micromax Marketing Plan

market shareholder in whole mobile market, 2 nd in smartphone market, 3rd in featured mobile phone
market
Maturity Stage: Micromax has already reached in the maturity stage in the Featured mobile phone.
Most of the sales are in the two & three tier cities and rural areas.
Decline Stage:

Since the company is new and no product as reached the final stage.

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Micromax Marketing Plan

2.2.2.

Category Factors

CURRENT RIVALRY IN CATEGORY

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2.2.3.
Seria
l No.

Environmental Factors
Environmental
Factors

Demographic

Economic

Natural

Micromax Mobiles
Demography is the study of human population in terms of
age, gender, occupation, density, size, location etc.
Demographic environment is extremely important to
Micromax as the entire positioning of the brand is on
youth.
Micromax makes products which can address the needs
of the young generation such as- photography, internet,
screen size etc. This market segment is price sensitive
too, and usually places price over the quality.
Micromax has hit the target here and this is one of the
reasons for its success. Location also plays a role, as the
requirements of semi urban and rural areas differ widely
from the urban areas. Micromax has also managed to
capture and address these requirements to a great
extent, without compromising too much on the quality
front.
The economic environment consists of factors that affect
the consumer purchasing power and spending norms.
Micromax has been able to address this factor as well.
The young buyers are price conscious. This also holds
true for the semi urban and rural markets.
However, for the consumers who seek quality, it also
launched high end phones which were competing with
the other established brands such as Samsung, LG, Nokia
etc.
Natural environment involves the usage of natural
resources in an eco-friendly manner. It entails usage of
mostly
eco-friendly
components
&
renewable/biodegradable materials and improving energy
efficiency. These steps create a positive brand image of
the company.
Micromax has been proactive on this front. Various steps
taken include- energy efficient chargers, using recyclable
materials (in product and packaging), adhering to
safety/environmental norms etc.

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Micromax Marketing Plan

Technological

Political Legal

Social Cultural

Technological environment is probably the most

important factor in the mobile industry today. The
technology is moving at a very fast pace and governed
by Moore's law, the products get outdated rapidly. The
users are attracted to the brands which can give them
the latest technological features at an affordable cost.
Micromax has kept itself in the race by consistently
adopting the newest technology in their products at
affordable price. Micromax phones have always been
competitive with other brands in the terms of
specifications and performance. There are several unique
innovations by Micromax in their products - such as high
battery capacity to address markets who faced power
outages, dual sim support to capture users who used
more than two phone numbers etc. It also had products
to address specific needs such as- Phones with QWERTY
Keyboards, Utility, 3G, gaming, multimedia usage etc.
Micromax also focused on the customer service aspect
and improved it. It has also been quick in updating its
products and launching new products. This has enabled it
to keep the interest levels of consumers high.
Political Legal environment plays a major role in the
marketing decisions of the company. Recently Micromax
was entangled in a legal controversy regarding one of its
brands (YU) with another company (OnePlus). However,
this issue was resolved. Any political and legal hassles
tarnish the brand name adversely.
Cultural and Social environment affect the thoughts and
consumption pattern of the consumers. This environment
is made up of institutions and other forces that affect the
basic values, perceptions, behaviors and preferences.
Micromax operates in a diverse cultural market. Market,
when classified on the cultural and social basis, has its
own unique and specific requirements in terms of the
language, promotion, and distribution channels. For
example, a rural buyer will buy the mobile phone from
nearest available brick and mortar shop, while the urban
buyers would prefer shopping malls and internet.
For promotion in Indian Market, famous actor Akshay
Kumar and Hugh Jackman have been hired. Association
with a foreign actor provides the brand with much
needed global image.

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Micromax Marketing Plan

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Micromax Marketing Plan

2.3. Company & Competitor Analysis

Serial
No.

Criteria

Micromax

Samsung

Motorola

Product
Feature

Micromax has
number of product
with dual-sim, high
battery life, 5-inch
screen provided at
strategic prices. This
defines the making
of Micromax as top
mobile seller in India
in 2014. Micromax
has been able to
cater unmet needs
of Indian rural and
urban consumer
segment.

Samsung has wide

range of phone all
features that are
needed by market.
However, in terms of
product mix to price
ration they lag
behind other phone
makers in the price
conscious consumer
segment. Overall, the
premium phone
segment, with its
phone providing
many cutting edge
technologies like
curved edge,
modular screen,
writing pen, it is a
strong player in India
market.

Though Motorola has

huge range of mobile
phones up its sleeves
with various features
like dual sim and QHD
screen, it is primarily
concentrating in
promoting handful of
devices labelled as
moto E, moto G, and
moto X. Thus, its other
product has low
visibility. The moto E,
moto G, and moto X has
found flavour in Indian
tech savvy middle class
market with good price
to quality combination.
However, aesthetics
apart it phones are not
much dissimilar from
Xiaomi, including online
only supply strategy.

Handful of phone
sets which are no
too different from
each other. Its ph
has dual sim, or 5
inch screen but lo
in range to cater
different market
segment.

Objectives

To find and meet

various unique
needs to in market.

To bring new
technology

To be an innovative
company.

High Quality
Technology that
doesn't cost a
fortune

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Xiaomi

Micromax Marketing Plan

Strategies

Marketing
Mix

Micromax being an
Indian company has
brought Indian
context to the
marketing table in
the mind-set of
Indian consumers,
despite of the fact
that majority of its
cell phones are
manufactured by
Foxconn, China. It
has spent heavily on
advertisement
through celebrity
endorsement like
Jack Hughes, and
sponsoring of
Cricket Events.
Differentiator # Micromax has
targeted unique
needs such
providing low cost
and high battery life
phones to rural
market
# Introduced First
Dual SIM, DUAL
Mode Smartphone
# First Universal
Remote Phone

Product:
Smartphones,
feature phones,
basic phone
Price: Strategically
priced to penetrate
the market.
Promotion: Heavy
spend on
advertisement using
TV, Internet, Paper
magazines,
billboards, and point
of purchase
advertisement.
Celebrity
endorsement,
Cricketing event

Samsung claims to
bring more cutting
edge technology at
the hand of
consumers. It aims to
be leader of the pack
as far as
technological
innovation is
concerned, as is the
case when they
introduced their
curved edge phone
S6 in the market.

Product: Cutting
edge Premium
Smartphones,
Smartphones, feature
phones, basic phones
Price: Skimming
prices, little higher
compared to
competition.
Promotion: Moderate
to Heavy promotion
using all channels

Simple products, giving

more importance for
features valued most by
customers thus bring
down the cost.

Product: Smartphones,
feature phones, basic
phones
Price: Penetrative
pricing
Promotion: Light
promotion to keep the
cost down.
Place: Available Online
through vendor of
choice, retail stores

Place: Online, retail

stores, supermarkets,
own outlets.

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Reduce Cost by
cutting cost on
advertisement, n
frill packaging,
decoupling
accessories, cutti
down distributors
using direct
shipment, and at
same time
maintaining the
quality.

Product:
Smartphones onl

Price: Penetrative
pricing

Promotion: Light
promotion to kee
the cost down.

Place: Available
Online through
vendor of choice.

Micromax Marketing Plan

sponsorship.
Place: Available
Online, retail stores,
supermarkets.

Profits

Strategically priced
product. Micromax
has traditionally
given higher
margins to
distributors (10-12%
compared to
industry average of
5-6%) in order to
penetrate the
market.

Additional profits
comes from little
premium over other
brands with
assurance of quality
of product, and after
sales support.

Use of strategic margin

over cost, designed to
penetrate the market
further.

At Xiaomi, additio
profit (above norm
profits) are driven
efficiency in keep
the cost of final
down.

Value Chain

Foxconn, China>>
Micromax Assembly,
India>>Distribution
channels

Global Sourcing + Inhouse

development>>
Samsung
Assembly>>Distribut
ion channels

Global Sourcing + Inhouse development>>

Motorola
Assembly>>Distribution
channels

Global sourcing>
Xiaomi Assembly
China>>Online
Distribution throu
Flipkart, India

Ability to
design new
products

Micromax strength
lies in innovation
using various mix of
proven technologies.
IT is not into
research and
development of new
material/ machine
for its smartphone
range.

Samsung is a big
player, and global
leader with huge
spends on research
and development of
new products such
has first curved
screen smartphone.

Motorola with its long

history in mobile
manufacturing

Xiaomi produces
frill smartphones
using existing
technologies. It h
relatively small ra
of smartphones in
market.

Ability to
deliver the
services

Has good tie-ups

with local market for
after sales services.

Strong network with

own service point in
various cities

No local aftersales
service points

Xiaomi is based in
China, and has no
local aftersales
service point.

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Micromax Marketing Plan

10

11

12

Ability to
Market

Ability to
Finance

Ability to
Manage

Expected
Future
Strategies

Huge Marketing
spends with
celebrity
endorsements, and
use of many
advertisement
channels. It has
made the product
available online, at
retails stores, Kiosk
at supermarket. It
has more
aggressively opened
outlets and service
centre across Indian
Cities than any other
mobile player in the
market.
Micromax may be
new to mobile
phone and lately
television market,
but it in new
company. Company
has been in business
in computer
peripheral business
since 1991. Being
one of the top 10
smartphone
manufactures in the
world, micromax has
created huge brand
equity. Thus can
source funds both
internally, and
externally with
relative ease.
Micromax has grown
very rapidly. This
has led to situation
such as stock out. It,
also, means
constant need of
hiring and more
managers in its
ranks. This, though
tough but is good
position to be in
rather than facing
issue of surplus.
Expect continuous
product flux with
innovative targeting.

Samsung has made

huge marketing
spends. It go to
market strategy
includes
supermarket, retail
stores, own stores,
and online
distribution.

With online only

presence in
smartphones, Motorola
is not into traditional
marketing.

Xiaomi follows
philosophy of
keeping prices low
with low spending
peripheral activit
including marketi
It largely depends
online presence a
word-of-mouth.

Samsung is big
brand, coupled with
its strong presence in
India, its ability to
finance its strong

Being one of the largest

mobile manufacturer in
the world, Motorola is
expected to flex it
financial muscles as
needed

Xiaomi is asset lig

company as far a
Indian operations
concerned. Being
online only playe
need to finance a
limited, and restr
if need arises.

Samsung has strong

presence in India.

Lack of local outlets /

services chains hinders
away the ability to
manage at the last mile.

With firm well

entrenched in Ch
its ability to mana
Indian operations
restricted.

Motorola seems too

concentrated on Moto E,
Moto G, and Moto X
further development
/improvement /
enhancement. New

Being online play

with limited set o
products it is
expected to just
upgrade the exist
mobiles. New pro

Samsung expected to
continue to innovate
in premium end.

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Micromax Marketing Plan

product launches are

not expected.

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launches are not

expected.

Micromax Marketing Plan

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Micromax Marketing Plan

2.4. Customer Analysis

Customer analysis:
In customer analysis, target customers are identified, the needs of these customers are ascertained,
and then it is specified how the product satisfies these needs. We made a survey to look after various
customer needs and tried to analyze the data based on some pre-defined parameters.
Sample size of the survey: 68
Range of age: 20-45
SEGMENTATION OF MICROMAX MOBILE MARKET:
Market segmentation involves viewing a heterogeneous market as a number of smaller homogeneous
markets, in response to differing preferences, attributable to the desires of consumers for more precise
satisfaction on their varying wants
Micromax Informatics Limited is one of the leading consumer electronics company in India and the 10 th
largest mobile phone player in the world & The countrys second-biggest mobile handset vendor.
Identification of the correct market segment is an important step to enter any market.
Present market segmentation of Micromax is as follows:
Dimension

variable
s

market trend

demograph
ic

Age

Micromax is a youth
oriented brand. Its
target customers
are of the age group
15-35.

Income
range

Micromax phones
are more popular in
low to mid-price
range. Hence its
most popular brand
in socio
economically weak
class. Though there
are some premium
phones which are
liked by high income
persons.

In house data

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Micromax Marketing Plan

Behavioral
attitude
toward
product

Common opinion
towards Micromax
mobile is, its a
great product at low
price.

Brand value scale

User
status

Demand of smart
phones has increase
significantly in past
3-4 years. Users are
getting more prone
towards using
internet services
through phone.

CONSUMER BEHAVIOUR:
Behavioral segmentation focuses on the behaviors that consumers exhibit in marketplace. Behavioral
variables represent an excellent segmentation tool, for as data are collected concerning the manner in
which consumers actually behave in the marketplace.
Factors affecting customer behavior are:

Age
Income
Price
brand
after sale service

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Micromax Marketing Plan

Based on these parameters we tried to trend the behavior of the mobile phone customers through
several questions, as followed:
Question asked

Customer response

What is your favorite mobile brand

Do you feel after sell service

important for you?

What age group you belong to?

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Micromax Marketing Plan

How you buy a phone?

If you buy a smart phone what

feature you look for?

Another approach to understand the market segmentation of Micromax in mobile market is through
CLUSTER analysis.
SEGMETATION:
We tried to determine the position Micromax as a brand in the mobile market in India. For the purpose
of analysis we used several parameters to determine the perceptual mapping.
Before proceeding in the perceptual mapping we tried to analyse the data through Scree plot, where We
get K=3.

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Micromax Marketing Plan

From Scree plot we found that, we can perform the perceptual based on two or three parameters.
The analysis is given as follows:
CLUSTER ANALYSIS
The final cluster analysis show that distribution among 3 clusters. The Cluster show the segmentation
with respect to Price, Brand Loyalty, Service and Involvement. The change in the Initial and Final
clusters Centres show that the data set i.e. the results from the survey are segmented in 3 cluster in
equal numbers. The Graph between Price and Brand loyalty shows the concentration of data set point in
Medium and affordable price range. Which also shows that for given price range customer prefer
Micromax mobile and also like to be affiliated with it. In this we removed the Age and Income data as
these two data set where similar to each other in most cases
Final Cluster Centers

Cluster
1

5000

25000

11200

BrandLoyal
ty

Service

Involveme
nt

Price

Number of Cases in each Cluster

Cluster

12.000

14.000

40.000

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Micromax Marketing Plan

Valid
Missing

66.000
.000

The regression curve between Involvement and Price changes as the price changes, with given factor
customer are more involved in affordable and medium priced phone i.e. the number of buyer is very
high when the mobile phone is in either affordable price range and medium price range.

TARGETING:
Micromax uses SINGLE SEGMENT BUT FULL LINE PRODUCT strategy to capture the mobile market in
India. They targeted almost all possible segments in mobile market. The Companys first bet was on
feature loaded feature phones. The aim was Nokia phones that were the bestselling phones in India
during 2008-2011.This was the time when Samsung was introducing Smartphones that were priced at
premium price points.
One of the earliest phones Micromax introduced was X1i that promised 30 days battery backup. After
this it introduced the first dual-sim dual-standby phone, the X600 Gravity. Then there was a phone for
gamers, a phone with built-in Bluetooth and the journey took to new heights by the year 2012.

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Micromax Marketing Plan

In a market where there were almost no gadgets aimed at ladies, the company took the courage to
introduce a phone aimed at ladies only. The company launched Q55 and A55 in its Bling series
especially for women, without the fear of being branded as sexiest.
The Company needed to find a suitable peg to shake the Indian urban market while also gaining on
sales figures. With Samsung as the only company selling 5-inch Galaxy S3 (4.8-inch) and a bigger Note
(5.3-inch) in India at premium prices, Micromax zeroed-in on the 5-inch segment. The target it laid for it
was making a 5-inch device affordable to everyone who wants one.
PERCEPTION MAPPING ON BASIS OF 2 PRINCIPLE COMPONENT ANALYSIS

2 factor P:
Rotated Component Matrix
Component
1
2
Brand Loyalty
Service
Involvement
Price

Factor F1
Factor F2

-0.01
-0.07
0.72
0.58

0.82
0.59
-0.09
-0.29

Factors
(Brand, Service)
(Price, Involvement)

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Positioning
Dissonance Reducer
Value Seekers

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3.Objectives
3.1. Corporate Objectives
Corporate Objective: The Generation Y device
In India 50% of population is below 25 years of age THE YOUTH, we want to create a product for the
youth that caters their needs. A mobile device for every youth in this country that represent the
independence, energy, speed, dynamic of the youth. As the market leader in the smartphone we want
to inspire the youth of this country.
Through our core value and commitment, will challenge ourselves to create product that
1. Caters to the needs of youth
2. Increases the market share of company
3. Affordable Phone with no compromise in technology.

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3.2. Divisional Objectives

Various divisions of Micromax are:

Presently Micromax holds the biggest position in the smart phone market in terms of
market capital in India. Starting as a mobile phone manufacturer, Micromax expanded its
business in other verticals of consumer electronics also. (As shown in above)
We concentrate our report on the divisional objective of phone segment of the company.
Division
Smartpho
ne

Present status

Objective

Micromax has 12
smartphone models.
The company has
recently set up a merger
and acquisition team to
scout for start-ups working
on new and interesting
technology that could add
value to its business.
Presently ranked 10th
in the global smart phone
market with a share of
1.8%.
Micromax accounted
for
22%
of
Indias
smartphone market share in
the October-December 2014
quarter
(Q4,2014)

Micromaxs growth is
expected to continue in its
domestic
market
and
international
expansion
targeting affordable price
range phones
The
company
will
launch nearly four new
handsets
every
quarter
catering specifically to needs
to the younger generation.
Preparing to expand
business beyond Indian soil.
Russia, the next destination
of Micromax mobile.
Micromax will keep
updating its product portfolio
with the latest technology
(Hardware
&
Software)
available in the market.

Future projects/plans:

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As growth has slowed and competition intensified in smartphones, manufacturers have started to look
to wearable electronics to generate revenue growth.

3.3. Marketing Objectives

3.3.1.

Volume & Profits

India mobile phone industry in 2014 -2015 has reached a matured stage compared where it was at
2011. Smartphones have reached more urban and rural households. Last 5 years have seen a great deal
of activities, wherein establish players like Nokia, a dominant mobile phone player in 2005, have
disappeared, and each year couple of new players like Xiaomi, Micromax are entering the market.
Technological improvements have drastically reduced price of ownership of smartphone. Today, a good
quality smartphone can be purchased at Rs. 5000, or even cheaper while availing an exchange offer.
This is a category traditionally been owned by feature phones. This present a unique opportunity to
Micromax to leverage Its Brand to capture bigger market share. At the same time, Micromax executive
should be vary of slew of android phones coming each year with increasing higher technology. Given
below are growth volume projection both for Industry and Micromax, calculated using weight average
method.
Industry

Growth
YoY Growth
Weightage

Volume

Micromax
Growth
YoY Growth
Weightage

Volume

2011
22%
0.12

2012
22%
0.18

2013
13%
0.27

2014
-20%
0.42

2015
-14%
0.65

2011
105%
0.12

2012
13%
0.18

2013
104%
0.27

2014
6%
0.42

2015
-13%
0.65

Forecast
2016
-7.93%

Forecast
2016
37.46%

The decreasing volume in last two years are due to complex interplay between technological advances,
maturing target market, and gradually shift toward high end phones. The customer, on back of
increasing salaries, and dropping prices are looking to buy premium phones. The trend is visible in case
of increasing net profit (Rs. Cr.).
Micromax - Profit
Net Profit (Rs. Cr.)
Weightage

2011
178.00
0.12

2012
180.00
0.18

2013
12.30
0.27

2014
185.00
0.42

2015
282.00
0.65

Forecast
2016
317.62

Based on this projection, the forecast / objective for Micromax in 2016 is an increase in volume sold of
37.46%, an increased figure 0f 317.62

3.3.2.

Time Frame

Given phone is a high flux industry, 1 year can be considered to a long term time frame, and used in
case of Micromax.

3.3.3.

Customer Retention

To maintain customer base, following strategy points can be utilized:

i.
After Sales Service: After Sales Service is a huge pain when it comes to Mobile devices. If
found to be even a bit of hassles, customers would choose to replace their phone. This may lead
to decrease in the customer base. Therefore, after sales service must be improved and new

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innovations must be brought to make after sales service a better experience. Micromax needs to
work on its after sales service strategy to better it. Some points that can be useful are listed
below:
Provide a comprehensive warranty including accidental damages. This is currently
being offered by some of the major brands in foreign markets, whereas it will be a relatively
new concept in India. If executed with due diligence, this can boost revenues and improve
customer satisfaction, thereby bettering customer retention.
Improvement in Product Quality: Gradual improvement in product quality will lead
to lesser after sales service incidents being logged
Opening up of more service centres: Micromax has a good presence in rural and
semi urban area also. This is imperative that these locations be covered by service centres.
ii.
Exchange Offers: This is a good business idea, to improve customer retention. As new
mobiles are launched, customers can be given a choice to trade in their old mobile phones to get
a loyalty discount on the new products. This will better customer retention. The experience of
changing over to a new Micromax phone can also be enhanced through software.

3.3.4.

Intermediary Retention

Intermediaries are very important components of the value chain, and it is through them the customers
search, select and buy the products. Therefore it is critical that Micromax pays attention to retaining the
intermediaries. Few points in this regard are summarized below:
Improving brand image: Brand image plays an important role in the customers decision
process, especially in urban and semi urban markets. Improving the brand image will improve
the sales and make the job of intermediaries easier. Also, intermediaries would prefer the phones
that get sold out quick.
Improving product quality: Improvement of product quality would better the image of the
intermediaries as well, especially in the rural market- where sales happen through word of mouth
publicity and based on personal relationships.
Training the distributors and dealers: Place and promotion are very important aspects of
the products under consideration. Proper training would enable the dealers to pitch the right
product to right customers. Additionally, the sales for mobile phones also depend on the
technical know-how of the salesmen, how they are able to compete against the similar
performing mobile phones of other brands
Promotion: Better promotion leads to better recognition of the brand name and the
dealers spend lesser time convincing the customers to buy the products
Distribution Efficiency: Micromax has to analyse and forecast the demands from different
regions and enable supply accordingly so that stock outs do not happen. Stock outs can have
negative effect on the brand image and dealers reputation.
Incentives over online sale portals: In todays context, a majority of customers are buying
through online stores who offer them very competitive prices and quick delivery. Brick and
mortar stores are slowly getting affected by this trend. Hence Micromax should encourage and
offer its dealers and distributors special incentives to stock and sell its phones.

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4.Product Strategy
4.1. Customer Targets
Driven by growing aspirations of the Indian mobile users, Micromax has geared up to bring about a
paradigm shift in the way cell phones are used by introducing ground-breaking mobile solutions
technology. The companys success could be attributed to the Out of the Box thinking and thus
providing Innovative & insightful products to the masses. For Micromax, the target audience is youth
who want innovative, stylish phones that are affordable. Today the mobile phone category is driven by
youth, with about 60% of the users under the age group of 20-35 yrs. and Micromax utilizes every
opportunity to connect with the youth. Micromax understands that building connect is all about being
involved with the customers and also giving them the value for money. Micromax segments the young
GEN next Indian population in majorly 3 parts as follows:

Target the college/school going youth:

Micromax understood the pulse of todays youth of age group 16-25, which are information savvy,
internet alcoholic, and tech geeks in terms of understanding and handling technology on their tip of
fingers. So they tried to capture the market of smart phones suitable for everyones pocket. The major
differentiating factor of Micromax is that it has managed to distinguish different unique needs of
customers and offer a product that solves them such as providing rural customers with long battery life,
and providing urban customers with the best variety at least cost with excellent quality of smart
phones.
Target the GEN next girls and women:
Micromax grabbed the insight that GEN next girls are technologically smart and stylish and that the
mobile phones have become a new fashion accessory, so girls love to flaunt them. Micromax is the first
mobile handset making company who targeted the women customers of India through their unique
value proposition.
Micromax launched its Q55 IIFA limited edition handset at the IIFA award function on June 5, 2010 in Sri
Lanka. The dream of the company was to have a phone chiefly targeted at women and make it feature
rich to make it a popular hit within the female community
Target the working professionals:
Present day working professionals are driven by some expectations from their mobile phone

Taking care of all these requirements, Micromax came up with CANVAS series, which provides all
customer needs in a single unit. In fact they gauged a fact that this generation of youngsters are prone
to try new products with better feature very frequently. Hence they came up with strategy of releasing a

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new model every now and then. In 2015, up to September they has released 55 smartphones in various
categories. In 2014 the figure was 67. This indicates how they are populating Indian mobile market with
their brand.

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Micromax Marketing Plan

Rural market customers:

While featured phones with basic features of other phone manufacturers are getting obsolete with time,
Micromax is strongly present in this category with a whole range of models that caters the basic needs
of the rural India. Looking at the needs of the market, Micromax has launched their cheapest phones :
Joy X1800 and Joy X1850. These are basic feature phones, which have been packed in a pouch,
instead of a box. Again, one of the firsts that Micromax has introduced in Indias fiercely competitive
phone market. 68% of all phones sold in India are feature phones and Micromax want to capture this
market with their low end feature phones. Their low cost feature phones can be described as yet
another attempt to increase their reach and market share in rural as well as technologically challenged
customers and an attempt to become a mass player in this segment.

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4.2. Competitor Targets

Seri
al
No.

Feature/Bra
nd

Micromax

Samsung

Motorola

Xiaomi

Product
Stage

Growth

Maturity

Maturity

Introduction

Advertiseme
nt Budget

Heaviest

heavy

low

low

SKU's

Very Large covering

needs lower class to
upper middle class.

Very Large number of

SKU's covering needs of
lower middle class to
Upper class.

Small number of
SKU's

only couple of SKU's

Strength

Good assortment
covering both rural
and urban needs
coming through
innovative designing.

Samsung research
capabilities enables it to
bring latest technologies
first to the market.

Efficient no-frill
manufacturing and
cost-effective
distribution

Efficient no-frill
manufacturing and
cost-effective
distribution

Weakness

No SKU in the upper

premium segment
(>35000).

SKU's with similar value

proposition are expensive
compared to other brands.
SKU's are not customize as
per Indian needs

Different SKU's are

all too similar with
just incremental
feature addition.

1. Only couple of SKU'

2. Different SKU's are
all too similar with just
incremental feature
addition.

Opportunitie
s

Growing demand for

smart phones

Growing demand for smart

phones

Growing demand
for smart phones

Growing demand for

smart phones

Competitor
Strategy
Targets

Price Based:
Micromax target is to
capture Indian Mobile
market by providing
product customized to
the local needs at a
low cost.

Brand Image: Samsung

targets largest number of
segment on back of its
brand image as company
that brings the new
technologies faster to the
reality

Price Based:
Motorola provides
no-frill products.

Price Based: Xiaomi

provide no-frill but hig
quality product at a lo
cost.

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Micromax Marketing Plan

4.3. Product/Service Features

The customer segment for Micromax has been defined in the earlier submissions. The various product
features for the Micromax devices required to target the defined customers are listed out below:
a. Build Quality & Performance:
Although Micromax targets the customers who are price sensitive, but build quality &
performance are important factors for them.
With advancement in technology and economies of scale, these features can be easily
incorporated in the products. Some of the competitors like Samsung, Xiaomi, and Motorola etc.
have already incorporated these qualities in their own products.
Cell Phone manufacturers are using metallic/hardened poly carbonate shells for their
phones. Also, the touch screens are made of hardened and scratch proof glasses.
Performance is important because of increased focus of customers towards gaming,
multitasking etc. The phone should have enough firepower to bring out the software features.
b. 4G connectivity:
Cellular operators like Airtel are pushing hard for its 4G services which are better in
performance compared to 3G and are priced equal to 3G services. Reliance is soon going to
launch its 4G Services in the country.
4G will soon become the norm for connectivity and hence a deciding criteria for the
purchase by the customers.
Another issue is the battery drain while using 3G/4G services. The offered products should
have capability to handle the battery drain suffered and provide a better battery backup.
c. Camera:
The mobile devices have started doubling as full-fledged cameras for all practical
purposes and hence cameras have become an important selling point in the mobile market.
Micromax should work on improving the camera quality of the phones, at least for the
flagship models.
Some competitors have come up with innovative features like front camera with flash,
which enables taking selfies even in dark conditions. Micromax could also provide such features
in few of its phones.
Additionally, the camera is also used in several video conferencing apps such as Skype
and hence the camera quality becomes all the more important.
d. Accessories:
The mobile phone market today is also driven by accessories available for the phones.
The accessories include a wide variety of products from camera add on to selfie sticks to
colourful panels. The accessories enhance the customer experience. The mobile phones
complement and drive the sales of accessories and vice versa is also true to some extent.
Micromax should introduce such accessories, which are innovative in nature and enhance
the customer experience.
e. Software features:
One of the USPs of cellular phones today are the software features. Almost all
manufacturers tweak the stock operating system and provide some key functionalities to attract
the users. Micromax should work on the some innovative features and bundle it along with the
phone.
Security is an important concern for everyday users. The phones must have basic security
features. Although currently Micromax is not targeting enterprise customers, providing better
security features would attract them even.
The various services features for the Micromax devices required to target the defined customers are
listed out below:
a. After Sales Services

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After Sales Services play an important role in building the brand of the manufacturer. A
poor after sales service can destroy the reputation of the brand. Micromax should look at
improving their after sales services and several innovations can be made in this aspect.
For example, the service centres could provide free pick up and drop services for the
defective and repaired phones respectively.
For most needed parts, an inventory can be maintained at local service centres and there
can be regional repair centres for the heavy repairs instead of having a central repair centre.
b. Showrooms and Service Centres
Showrooms push the brand image of the firm. Micromax should plan and open company
owned showrooms and stores in metros. Each metro should have at least one showroom at the
primary business locality.
Service Centres are important because they are instrumental in providing the after sales
services. Their number in the given city should be in proportion to the volume sold. The staff
must be trained to handle the issues and customers. For premium phones, the service centres
should provide a standby phone to the users, until their phones have been repaired.

4.4. Core Strategy

4.4.1.

Value Proposition

o
Affordable: Micromax offers the best mobile phone with the most affordable price
in the market, the tag line Nothing like anything self-explains this. Now days mobile phones have
become a common part of our lifestyle with high speed internet technology mobile is not limited to
making call rather than it serves functions like internet communications, office application. But the
question is how much are you going to pay for a mobile phone? Micromax Mobile phones ranges
from 5000INR to 21000INR. A price for each category of customer. Micromax has also tied up with
google and launched android one mobile phone in India.
o
Two in One: Dual sim phones enable you enjoy the advantage of two mobile in
one. Use one sim for data package and another to make call.
o
Powerful and Slim: Micromax Mobile phone uses latest mobile computing
technology, new Octacore chipset as soon as the chipset is launched, and new hardware. Addition of
new hardware like snapdragon and mediatek processor has significantly increased processing power
of mobile Phone. Micromax mobile phone have always improved its design feature, trying to reduce
the weight and thickness of its mobile phone. Micromax Knight series mobile phone is one of the
light weight phones in the market with full HD IPS technology and stunning design.
o
Stay updated with latest technology: All the smartphones are android based
phone, all phones are updated with latest updates of android operating system. Micromax has
incorporated new corning gorilla glass feature in all its smartphone which provide safety to mobile
screen against scratches. Expandable Memory with use of micro SD card you can store all your
music, photos and documents
o
Dont miss to capture any moment: All smartphone have both front and rear
camera, 16 megapixel camera with fast image capturing and low light performance enable to take
image anywhere anytime. Front camera for Selfie and rear camera for HD video shoot.
o
Do more with efficient battery: With large battery power Micromax mobile
phones offers stand by time of 175hrs and talk time for 8 hrs. Perfectly for full day use with no
compromise on performance. Software and hardware coupled such that is minimizes the battery
consumption.

4.4.2.

Product Positioning

In India the Distribution\ Buying of Mobile phones primarily takes place at electronic retail stores and
then through online shopping. Approximately 81 % through Electonic Reatailer and 14% through
online.So micromax offers its product mainly through its Retail outlets and through online sites like
flipkart, ebay and amazon. Micromax has also increased its no. of reatils stores in semi urban and rural

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areas. Micromax also has an extensive distribution network with presence in more than 560 districts
through 125,000 retail outlets in India, allowing the company to sell to second- and third-tier cities and
thus, expanding its reach and market share.

5.Marketing Programmes: Strategy

5.1. Integrated Marketing Communications Programmes
Several successful marketing strategies has been implemented to take Micromax in first 3 position in
mobile market. Here are the marketing strategies which Micromax followed:
a. Sponsoring Indian Cricket Matches
In India CRICKET is synonymous to religion. But Micromax knew that Indian people love cricket more
than any other game and serial. So they sponsors a lot of domestic cricket series. With this strategy
they reached to millions of customers. In 2014-15 they paid 20m INR to BCCI per match.
b. Reach to Indian market
Soon after launching their own mobile handsets in the market they started opening outlets all across
Indian cities. They opened outlets and service centres more aggressively than any other mobile
company even beating Nokia. Through this they become a household name in all cities and quickly
made its own identity.
c. Right product strategy
Micromax knows what Indian wants. Cheap in price and high in quality. What Micromax does is
Right product at right time at right price. Of course their products quality is lesser than that of
some of the premium brands, but the product lives of all companies are same. May be not more than
one or two years. Every quarter they bring a new handset, only competitor in terms of launching
handset is Samsung. They have product for all categories and for all type. Now they have started
selling product in Russia as well.
d. Introduction of Celebrity
They roped in some of the biggest celebrities to attract customers. Introducing Huge Jackman as
brand ambassador for canvas series of mobiles and roping in Twinkle Khanna for their woman
oriented phones they created an environment of trust among the customers.
e. Media channels:
Micromax targeted all available customer promotion option to reach their customer. From print
media (like newspaper promotion) to electronic media (like online promotion in various blogs and
social media), from visual media to (like television) to promotion through online shopping stores (like
flipkart), they have touched all corner stones to reach to customers in big way.
f.

Innovative packaging:

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Micromax attracted customers through their innovative packaging strategies. Recently The
Company unveiled its first two handsets in the series the X1800 & X1850, first ever pouch
packaging phones in the market offering unparalleled value to consumers.
g. Special promotion through online shopping stores:
Micromax tried to reach new age netizens through attractive offers and exclusive promotions in
online shopping stores. They provided an opportunity to the millions of Canvas Spark fans, by
offering its first ever open sale for the smartphone on Snapdeal.com to ensure that Micromax fans
are able to successfully purchase the product. On the same note, Micromax had exclusively tied up
with Flipkart.com, Indias largest e-commerce marketplace to launch its latest smartphone, the
Canvas Xpress.
h. Innovative promotion platforms:
Micromax, introduced Micromax MAd, a unique application designed for those who love ads, which
comes pre-loaded on its latest smartphone Micromax MAd A94. With a simple 4 step process, MAd
allows users to watch advertisements and earn points from every advertisement one views, which
then can be converted into rupees. The money eventually credited into their post-paid/prepaid
accounts. With one time registration, the service worked for all opted-in subscribers across all
telecom operators.
All these extensive promotion strategies made Micromax a leading mobile brand in India.

5.2. Pricing Strategy

Today the Entry level and smart phone market has a high number of firms jostling for market share and
hence all firms face cut throat competition from each other. This is where pricing strategy assumes
prime importance. The target customer base for Micromax is price as well as quality sensitive. Therefore
it is very important to combine pricing and quality of the product to arrive at the right proposition.

Micromax is an established brand now (2 nd in market share, only behind Samsung). Micromax adopted
penetration strategy in past to gain market share. In our opinion, they do not need to pursue this policy,
as it does not contribute to the bottom line of the firm. A firm needs to grow its bottom line for
continued focus on R&D and thereby improvement in products.

We suggest that Micromax continues to sell its product portfolio on the pricing strategy that it has been
following. We suggest that Micromax adds another product family of high end smart phones, which
would rake in cash, thereby improving the bottom line of the firm.

To make the new product family successful, they would need to focus on design, value add-ons and
quality of the product. This product family can be priced higher to target high earning customers. R&D is
almost similar for the entire product portfolio, hence it would benefit the entire product portfolio.

5.3. Channel Strategy

Micromaxs focus area currently is B2C segment. We suggest that it also focuses on B2C Segment. The
channel is depicted in the flow chart given below:

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The Channel is an important component of the marketing strategy for Micromax. Micromax mobiles are
sold in shops in Shopping Malls as well as small phone booths in villages. Hence efficiency of the
channel is very critical for success.

The B2C Selling follows a longer channel route because of the huge geography and demographic
spread. The key to keep channel working in Micromaxs favour are incentives to the channel partners
and constant demand. Customer demand can only be generated if the products are successful.
Incentives to channel partners can be increased if the bottom line improves. Therefore Micromax needs
to improve the bottom line and better the quality of the product.

B2C selling can be done directly through Distributors. The enterprise is a market segment which
Micromax hasnt focussed on yet. With increasing acceptance of mobile devices in corporate workings
and BYOD, this segment could prove very profitable for Micromax. Also, this segment requires a shorter
and therefore channel that has a higher efficiency.

5.4. Customer Management Strategy

a) Customer value proposition: What we provide to customer to reduce their search in
buying and associate their values with our product. (Mobile Phone)
1) Multifunctional Phone : Easy to use i.e. functions like testing , internet browsing are very
user friendly ,Capability of handing dual sim, High Quality Audio-Video Quality, High end
camera, Expanded memory for applications and other things, keep all thing in one place ,
connected to cloud so can access your desktop or laptop.
2) Greater Durability: long lasting battery backup, Dust resistance, scratch resistance body,
light weight but rigid,
3) Value for Money: As per your budget choose the best mobile Phone, Premium quality in
affordable price with latest technology, large number of product range.

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4) Aesthetic appeal: Slim and sleek design, Light weight, multiple color options, Non Light
reflective screen
5) Free update: Pre installed software for office and personal use, free android update, Get
paid for
watching add, Customizable home screen and navigation keys
6) After sales services: 1 year warranty on product and parts, complete replacement in case
of defect, pick up service for repair, large no. of after sales office across all cities,
b) Customer Centered Brand Management
1) Fast and Effective After sales and support services: Having captured the market and
occupying large volume of mobile handset in market doesnt help to sustain the growth.
Growth depend on the after sales and support service what is provided. How fast Mobile
handset is repaired or problem is solved such that it doesnt spoil the name of brand basically
by word of mouth.
2) Durability: A Mobile is majorly targeted for youth segment it is expected to have a rough
usage, product should be built in such a way that it can withstand rough usage.
3) Making brand decisions subservient to decisions about customer relationships. Customer
segment manger to have high resources for creating information flow from bottom to up and
in marketing.
4) Building on customer Experience: Hosting a website for customer to give feedback and
providing a place for interaction.
5) Experience design Determine how to meet the segment-specific needs in each business
segment, either by improving existing approaches based on new insights from the architecture
or by developing entirely new ones. All the levers of customer experience product, service,
content, channels, touch points, pricing, facilities, sensory engagement, etc. should be
considered and described in the design.
6) Retail Outlets and Supports stores should be located such that it can be accessed by
customer easily, having a one larger store in a city its better to have multiple small store
across the city.

5.5. Research
Micromax has been very successful in understanding the market and capturing the essence into
marketable products. It has been a smart marketer of its brand and products. Smart marketer meansa.
b.
c.
d.
e.
f.
g.
h.

Recognizing unmet needs of different market segments.

Selecting the needs that can be served leveraging the companys capabilities.
Selecting the potential market segments
Designing products to serve the selected market segments unmet needs
Communicating the product features
Establishing the channels to reach the targeted customer segments.
Pricing to attract the customer to the point of sales.
Post purchase servicing to build brand loyalty.

Each of the above mention steps of customer need fulfilment value chain, is value point that can be
developed to attain higher efficiencies, and establish brand differentiation. Thus, firms Research and
Development should not just focus on the technological aspects such as next generation product
assemblies, and next-generation of operating system, and hardware. It should also focus business re-

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engineering activities that embedded innovation as a culture into all steps of the business value chain
encompassing market research, operations, logistics, operations, quality, supply chain etc.

A high number of Micromax product contents are sourced from foreign vendors. This exposes Micromax
to foreign exchange, socio-political, and country risk. Some of Micromax local competitors such Lava
have recognized this need and have setup Research and Development centres in India to build in-house
capabilities. The can further drive down the cost of manufacturing and go to market activities by using
greater localization. Micromax, though has taken some initiative in the direction, however, much more is
expected from Micromax if it need to build and retain its position as Market leader. Micromax should
loosen it purse to have higher expenditure on Research and Development activities.

It should be noted, that spend on Research and Development is need not just for bringing out better
products, and to develop smarter business process, but it is also a signal to market that the firm is
serious endeavour to be innovative leader of high quality products in its segment.

As mentioned earlier, Micromax has been highly successful in understanding the needs of its customers.
This is an area of core strength for Micromax. This is one area which many players have recognized as
their key focus area. There exists a market trend for greater involvement of customer / customer
opinion in the product designing cycle. Micromax needs to protect its core competence in this area by
further integration customer through greater market research, and application of behavioural
economics, a field of social science that has been attracting most innovative companies across the
globe.

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6.Controls
6.1. Financial Controls
a.
Budgeting: Financial budgeting for marketing is done by allocating a percentage of the
actual or projected gross revenue. Micromax spends about 2% of its sales on advertising and
marketing. In 2014-15, it posted sales of over Rs 10,000 crore. By March 2015, Micromax would
spent about Rs 200 crore in promotions and advertising. Micromax, used to spend about 10% of its
marketing budget on digital media until 2014. Now, more than a third of it goes towards online
campaigns. 'Exclusive' online only smartphone sales have contributed to more than 20% of the total
smartphone sales between July and September so far, according to Counterpoint Research. The
budget allocation depends on several factors: present market trend, growth rate of the company,
competitors position in the market etc. This budget is split between:
1) Brand development costs (which includes all the channels those are used to promote Micromax
brand such as website, blogs, sales collateral, etc.), and
2) The costs of promoting business (campaigns, advertising, events, sponsoring cricket series etc.).
Recently Micormax has roped in actors like Kapil Sharma and Daggubati for a period of one year and
have big plans for its Bolt Range.
They have kept it as their flagship product and has diverted 60-70% of their marketing budgets towards
it. However, the rest of the marketing spends will be for the Canvas Range, which is already paying
good dividends to the brand.

6.2. Marketing Matrix

Defining Marketing Metrics for micromax mobiles. From the below mentioned data we can that the sale
of mobiles mostly takes place from Electronic appliance and specialist retailers.The % of sales through
internet has also incresed from 9% in 2014 to 12.8% 2015.So it would be much wiser to target these
two areas under maeketing metrics.

Source : Euromonitor.

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Sale promotions, Advertisement can affect the consumer in following ways:

a) Change in Awarness : Micromax has not yet evolved as big indian brand , consumer associate it
with only medium (less costly )range mobile phone even though it sells high end phone. Since the
popularity of micromax as medium range mobile maker cannibalize the sales of high end mobile phone.
Through Advertisement and Sales promotion micromax should increase the awarness about its higher
end mobile phone and other product. Promotion in reatils store and internet should be used. Currently
micromax uses celebrity endorsement for only one product and same celebrity for upcoming product
which may produce confusion among consumers.
b) Change in Perception: Micromax should try to change the perception in which consumer associate
its products with them. The question to be answered is that are the purchases made accounts to the
loyal customers or it is the new customer population which is buying product, what is the repurchase
time or cycle time of purchase of consumer.
c) Change in Behaviour: sales promotion and advertisement should change the buying behaviour of
product , new phones should be promoted such that consumer should be willing to buy the new phone
rather than sticking to old phone. The frequency of new phone should be matched properly if the
product launch is fast then loyal consumer or current consumer may not buy the phone. Addition of new
features and upgrading technology in product and lauching then at regulat interval should be used.
Currently micromax new phone frequency is high.
These three parameters should be applied to smartphone and featurephone , as currently the feature
phone is higher than smatphone but consumer are switching to smarthphoen because of technological
factor and internet based communications.
Measurement of sales promotion and advertisement : Simply allocating budget and doing the promotion
and adverstisement will not increase the sles , micromax should measur the effect of promotion and
advertisements with keeping following points
a) Defining the potential growth which the programme intend to produce.
b) Analyzing actual results and determining whether your program promoted them.
c) Tuning up your program based on the sales tracking; doing more of what works well.
d) Analyzing Return on marketing investment (ROMI) , marginal change is sales due change is
marketing investment.
e) The matric should be such that it can measure the average value of a sale, average number of sales
to each customer per year and average number of years a customer stays with your company.
f) Discount and other benefits given on seasonal sale (festive season) in oder to maximize sales in short
period.
g) Valuable service to loyal customer and providing distinctive offers to maximize the number of product
user.
h) Analyzing data from web, postpurchase surveys, customer relationship management (CRM) system,
call center, email.
i) Analyzing and determing campaign key performance indicators (KPIs) ahead of launch, and ensure
proper measurement across multiple internal and third party data sources.
j) Matric should be simple, replicable and sholud have information that drives the sales. Feedback on
failure should be included in the matric

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Micromax Marketing Plan

Parameters

Measurements

Revenue Indicator

How much extra revenue has the programme generate

ROMI

Increase in sales wrt. marketing investment

Marketing Performance

No. of new consumer attracted and No. of consumer left

Profit Per Customer

Profit on selling price per product per customer

Time Line

Average life of product , Average no. years for which customers

uses the product

Target Area of
advt./Promotion

change in sales from specific area i.e. retail outlet and online
portal because of advt./Promotion and marketing Investment on
these specific

Micromaxs marketing plan comprises advertising in print media, electronic advertising, television
campaigns, and endorsement by famous Indian personalities who participate in its marketing
campaigns, and sponsorship of prominent sporting and film events in India. Micromax advertisement
and promotion expenses were Rs. 501.38 million and Rs. 55.76 million during fiscal 2010 and 2009,
respectively and constituted 3.20% and 1.62% of its sales. Rebates and discounts increased from Rs.
112.70 million in fiscal 2009 to Rs. 160.60 million in fiscal 2010. As a percentage of total expenditure,
rebates and discounts however decreased from 3.75% in fiscal 2009 to 1.26% in fiscal 2010.

2010
Net Income (EBITDA)

3,278.23 million

Advertisement and Promotion Expenses

501.38 million

Rebates and Discounts

160.60 million

Selling and distribution

752.70 million

Total Marketing Expenditure

661.98 million

Mobile Units Sold

7.05 million Units

ROMI

622%

Customer Acquisition Cost

200.66

Marketing % of Customer Acquisition Cost

(M%-CAC)

47% ( Marketing Cost 71.11 / Sale &

Marketing Cost 200.66)

ROMI of 622% with Marketing Cost per Unit Sold at 71.11 highlights the importance of Brand and
promotion activities for Micromax. Micromax would need to continue to sell focus on Brand and
promotional activities to supplement it product innovation and capacity upgrade plans to further
penetrate the Indian market.

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7.Contingency Plans
Although Micromax has been very successful, but the mobile market is very uncertain and diversifying
into several domains makes sense for the firm. We suggest the following strategy for Micromax to
diversify into related domains:

a. Consumer Electronics: Micromax has already ventured into consumer electronics domain. It has
started offering LED TVs, Data Cards etc. Electronic Goods like Data Cards also find customers in
B2B selling. Micromax can also venture into Internet Connected home appliances such as Smart TV
etc.
A smart TV device is either a television set with integrated Internet capabilities or a set-top box for
television that offers more advanced computing ability and connectivity than a contemporary basic
television set. Micromax can collaborate with Google to power its TVs using Android Operating
System.

b. Tabs: Although Tabs lies in a heavily crowded market segment, but there is still a lot of room for
innovation and there lies a potential business opportunity. The tab market is ruled by Samsung and
Apple, which definitely have better products in higher price segments but not in economy/value
segment.
Micromax already sells tab in the entry level segment, but has not focussed on the same. It needs to
revamp its offerings and increase focus on this market segment. Tablets provide better utility
compared to Phones in multiple scenarios due to their large screen size. Tabs can be customized to
suit the needs to various users/industries, some of the probable examples are discussed below:

i.
Tabs can be sold to enterprise clients in Education/Research Verticals as a part of
smart classroom programs.
ii.
Tabs can be customized and sold to Enterprise clients to enable their sales force.
Sales force is usually on the move and carrying a laptop is inconvenient, hence Tabs provide
a reliable alternative. IBM and Apple have a collaboration for a similar motive, wherein all IBM
Sales employees get an iPad customized to meet their requirements. This serves dual
purpose- it enables IBM employees to carry out their business activities/tasks efficiently and
serves as a proof of concept to possible Enterprise Customers for iPad Sales. It also promotes
BYOD concept in the organization.

c. Entry Level Laptops enabled by Cloud: The world is moving on to the cloud now. Google has
been promoting its Chrome OS, which works on laptops/notebooks with bare minimum configuration
and builds on their cloud infrastructure. Microsoft is also entering this segment with their cloud
offerings. Internet penetration is on the rise in India and this can prove to be a major business
opportunity. Some industry segments can targeted specifically and Micromax will have first movers
advantage.

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Micromax Marketing Plan

d. Software Innovations: Micromax is planning to launch its own version of customized Android
Operating System. This is a model followed by some of largest Smart Phone manufacturers such as
Xiaomi, Meizu etc. Launching phones with Customized OS is a huge differentiator in todays markets
and provides value addition to customers. Having Customized OS allows manufacturers to
incorporate the needs the target customers and respond fast to their needs.

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