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PROJECT REPORT ON
Retailers role in Demand Creation
(With respect to Car Audio systems)
BY
Rahul Prasad
H.T. No. 332-09-01824

[Submitted in partial fulfillment for the award of


Bachelor of commerce in (Honours)]

ST.JOSEPH’S DEGREE COLLEGE


(Affiliated to Osmania University)

KING KOTI, HYDERABAD


2009-2011
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A PROJECT REPORT ON
RETAILERS ROLE IN DEMAND CREATION
(With respect to Car Audio systems)

PROJECT SUBMITTED
TO
OSMANIA UNIVERSITY
IN PARTIAL FULFILLMENT FOR THE AWARD OF THE DEGREE
OF BACHELOR OF COMMERCE [HONOURS]
BY
RAHUL PRASAD
[332-09-01824]

SUBMITTED TO DEPARTMENT OF COMMERCE


St. JOSEPH’S DEGREE & P.G. COLLEGE
[AFFILIATED TO OSMANIA UNIVERSITY]
3
HYDERABAD 2009– 2011

CERTIFICATE:

This is to certify that, the project work titled “RETAILERS ROLE IN DEMAND
CREATION (with respect to Car Audio systems)” is being submitted by
RAHUL PRASAD bearing Roll number 332-09-01824 in partial fulfillment for the
award of the Bachelor of Commerce (Hons) at St. Joseph’s Degree College to the
Osmania University is a record of the bonafide work carried out by him under the
guidance and supervision of Internal Guide.

This project work has not been submitted to any other university or institute for the
award of any degree or diploma.

Rev. Fr. V.K Swamy Mrs. Mary Vinaya Sheela

Principal Head of Department

Mrs. Nisha Mathur

Internal Guide External Examiner


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CERTIFICATE

This is to certify that the project titled “RETAILERS ROLE IN DEMAND


CREATION (with respect to Car Audio systems)” bearing roll no. 332-09-
01824 in partial fulfillment for the award of the degree of bachelor of
commerce(honors), submitted to Osmania University.

This report is an authentic work done by him under my guidance. This project work
has not been submitted to any other university or institute for the award of any
degree or diploma.

Place: Mrs. Nisha


Mathur
Date: (Internal
guide)
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DECLARATION

I RAHUL PRASAD hereby declare that the project titled “RETAILERS ROLE
IN DEMAND CREATION (with respect to Car Audio systems)” is my
original work and is submitted towards the partial fulfillment for the award of
Degree in Bachelors of Commerce (Honours) of Osmania University. The project
has not been submitted to any other university for the awards of any other degree or
diploma.

I further declare that this is an original work done and this has not been submitted to
other university/institution for award of any degree/diploma.

Place: Hyderabad (RAHUL PRASAD)

Date: Ht.No.332-09-01824
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ACKNOWLEDGEMENT

This Project would not have been completed without the support from the following
eminent personalities.

It’s a great privilege to express my profound gratitude to


REV. FR. V.K. Swamy, Principal St. Joseph’s degree and P.G College and
Mrs. Vinayasheela [H.O.D; commerce Dept] for their valuable assistance and
guidance throughout the project.

I am acknowledging my thanks to Mrs. Nisha Mathur (Internal Guide) for her close
guidance, encouragement and great suggestions for critical points during my project
study period.

In the due course I was encouraged and inspired by many other close associates, I
am thankful to one and all who have extended their help in the completion of this
project work.
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INDEX:

CHAPTER CONTENTS PAGE NO.


NO.

1. INTRODUCTION 1
1. Introduction 1
2. Literature Study 1
3. Objectives 4
4. Research Methodology 4
5. Limitations 4
6. Scope 5

2. OVERVIEW 6
1. Retail 7
2. Consumer Durables 18
3. Demand Creation 19
4. Market Players Under Car Audio Segment 21

3. DATA ANALYSIS AND INTERPRETATION 36

4. SUMMARY & CONCLUSSIONS 47


1. Findings 48
2. Conclusions 51
3. Suggestions 55

BIBLIOGRAPHY 56

ANNEXURE 57
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Chapter 1
Introduction
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Chapter 1
1. Introduction
This research is done to find out the role played by Retailers in the retail
industry, basically the role of Retailers in the Consumer Durable segment
(Consumer Electronics: Car Audio). The retail industry in our country is at
boom and getting organized day by day, the demands of customers are not just
great products but also great shopping experience and to make this possible a
retail outlet should have efficient sales force. This study is made to know how
efficiently the sales people of retail industry in Car Audio segment are in
promoting Consumer Durables.

The retail industry in INDIA has changed its face and approach. Sales people
working in this industry play major role in handling the customers effectively.
This study is done to evaluate the retail industry in Consumer Durable Segment
and also to understand how the organisations in Car Audio market is partially
dependant upon the Retailers in achieving their sales objectives.

2. Literature Study

The Retailer's Role In Quality Retailing - The Emerging Scenario


In India:

The Indian retail industry is thriving today. There is stiff competition among Indian
and foreign retailers to attract customers and retain them. In this tug-of-war, quality
retailing has emerged as the solution. The retailer who provides quality products and
services along with a quality shopping experience succeeds in the long run.

The quality of the product offered by the retailer has two aspects - the perceived
quality and the actual quality. Perceived quality or point of sale quality refers to the
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image that the customer has about the product while buying it. The actual quality
or the point of use quality is the quality of the product that the consumer experiences
while using it. The retailer plays a very important role in building up perceived
quality with the use of attractive display. The retailer is in direct contact with the
customers and so he can play a significant part in helping the manufacturer reduce
the gap between actual and perceived quality. The retailer should also ensure quality
at the various stages of the supply chain so that the quality of the product is not
affected.

Another important factor to be considered for quality retailing is the quality of the
services provided to the customer. Today's customer wants a unique shopping
experience. Retailers are striving to help customers enjoy their shopping expedition
as much as possible. The difference between shopping in India and shopping abroad
is reducing gradually, particularly with several large malls coming up all over India.
Customer mentality is different in different countries. Particularly in India, there are
huge cultural differences among the people of different states, which in turn affect
their buying behavior. In this scenario, it becomes necessary for the retailer to
survey the customers' culture and expectations so that he can train his staff to
appropriately meet these expectations.
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Role of Retailers in Shaping a Firm’s Strategic
Direction:

Research across emerging markets of Asia, Africa and Latin


America breaks six common myths about emerging
consumers) (Richards, 1998). Although “poor” relative to the
upper consumer segments, these consumers spend a great
deal of money on consumer products. When shopping, they
follow a quite rational and sophisticated behaviour as they
seek to reconcile preferences with their economic reality.
They have a distinct set of product and format needs – which
does not necessarily include whatever is lowest cost, credit,
or responding to shelf prices. The personal relationships and
sense of community they seek is a strong incentive to shop
in small-scale retail formats. Furthermore, differences within
emerging consumers imply that companies – both
manufacturers and retailers – need a differentiated
proposition to address the needs of this group. Also sub-
segments could be identified among emerging consumers,
based on economic or behavioural patterns (not necessarily
on geographical or country criteria).

Objectives
 To study the working of Car Audio market.
 To know various strategies by the organisations on the Retailers.
 To study sales promotion by retailers.

Research Methodology
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Data Collection:
Data collection consists of two. They are:
 Primary Data: “Data originally collected in the process of investigation are
known as primary data.”The primary data has been collected through
Questionnaire.
 Secondary Data: “Secondary data are those already in existence from some
other purpose than the answering of the questions in hand.” The secondary
data has been collected through internet, magazines, news papers and Field
Professionals.

Data Analysis:
Data Analysis can be done by various methods; statistical tool employed in
analysing data is Column Diagram.

Limitations
 Due to time constrain the sample size has been limited to 50.
 Study relates only to Car Audios.
 As no survey was made on this segment lack of information was another
limiting factor.
 Retailer’s knowledge is biased.

Scope
The scope of this study is limited to retailers. This study has been conducted to
know as to how retailers help organisations reach customers, who are not aware
of Mobile entertainment.
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Chapter 2
Overview

1. Retail
Retail consists of the sale of goods or merchandise from a fixed location, such as a
department store, boutique or kiosk, or by mail, in small or individual lots for direct
consumption by the purchaser. Retailing may include subordinated services, such as
delivery. Purchasers may be individuals or businesses. In commerce, a "retailer"
buys goods or products in large quantities from manufacturers or importers, either
directly or through a wholesaler, and then sells smaller quantities to the end-user.
Retail establishments are often called shops or stores. Retailers are at the end of the
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supply chain. Manufacturing marketers see the process of retailing as a necessary
part of their overall distribution strategy. The term "retailer" is also applied where a
service provider services the needs of a large number of individuals, such as a public
utility, like electric power.

Shops may be on residential streets, shopping streets with few or no houses or in a


shopping mall. Shopping streets may be for pedestrians only. Sometimes a shopping
street has a partial or full roof to protect customers from precipitation. Online
retailing, a type of electronic commerce used for business-to-consumer (B2C)
transactions and mail order, are forms of non-shop retailing.
Shopping generally refers to the act of buying products. Sometimes this is done to
obtain necessities such as food and clothing; sometimes it is done as a recreational
activity. Recreational shopping often involves window shopping (just looking, not
buying) and browsing and does not always result in a purchase.

The Global Retail Industry: An Overview


Retail has played a major role world over in increasing productivity across a wide
range of consumer goods and services .The impact can be best seen in countries like
U.S.A., U.K., Mexico, Thailand and more recently China. Economies of countries
like Singapore, Malaysia, Hong Kong, Sri Lanka and Dubai are also heavily assisted
by the retail sector. Retail is the second-largest industry in the United States both in
number of establishments and number of employees. It is also one of the largest
world wide. The retail industry employs more than 22 million Americans and
generates more than $3 trillion in retail sale annually. Retailing is a U.S. $7 trillion
sector. Wal-Mart is the world’s largest retailer. Already the world’s largest
employer with over 1million associates, Wal-Mart displaced oil giant Exxon Mobil
as the world’s largest company when it posted $219 billion in sales for fiscal 2001.
Wal-Mart has become the most successful retail brand in the world due its ability to
leverage size, market clout, and efficiency to create market dominance. Wal-Mart
heads Fortune magazine list of top 500 companies in the world. Forbes Annual List
of Billionaires has the largest number (45/497) from the retail business.
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GLOBAL RETAIL (Source: CSO, MGI Study)


1999 2002 2005
Total Retail (US$ Billion) 150 180 225
Organised Retail (US$ Billion) 1.1 3.3 7
% Share of Organised 0.7 1.8 3.2
retail

Retail Scenario in India: Touching Meteoric Scales


The Indian retail industry is the fifth largest in the world. Comprising of organized
and unorganized sectors, India retail industry is one of the fastest growing industries
in India, especially over the last few years. Though initially, the retail industry in
India was mostly unorganized, however with the change of tastes and preferences of
the consumers, the industry is getting more popular these days and getting organized
as well. With growing market demand, the industry is expected to grow at a pace of
25-30% annually. The India retail industry is expected to grow from Rs. 35,000
crore in 2004-05 to Rs. 109,000 crore by the year 2010.
As the corporates – the Piramals, the Tatas, the Rahejas, ITC, S.Kumar’s, RPG
Enterprises, and mega retailers- Crosswords, Shopper’s Stop, and Pantaloons race to
revolutionize the retailing sector, retail as an industry in India is coming alive. Retail
sales in India amounted to about Rs.7400 billion in 2002, expanded at an average
annual rate of 7% during 1999-2002. With the upturn in economic growth during
2003, retail sales are also expected to expand at a higher pace of nearly 10%. Across
the country, retail sales in real terms are predicted to rise more rapidly than
consumer expenditure during 2003-08. The forecast growth in real retail sales
during 2003- 2008 is 8.3% per year, compared with 7.1% for consumer expenditure.
Modernization of the Indian retail sector will be reflected in rapid growth in sales of
supermarkets, departmental stores and Hypermarts. Sales from these large-format
stores are to expand at growth rates ranging from 24% to 49% per year during 2003-
2008, according to a latest report by Euromonitor International, a leading provider
of global consumer-market intelligence.
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A. T. Kearney Inc. places India 6th on a global retail development index. The
country has the highest per capita outlets in the world - 5.5 outlets per 1000
population. Around 7% of the population in India is engaged in retailing, as
compared to 20% in the USA. In a developing country like India, a large chunk of
consumer expenditure is on basic necessities, especially food-related items. Hence,
it is not surprising that food, beverages and tobacco accounted for as much as 71%
of retail sales in 2002. The share of food related items had, however, declined over
the review period, down from 73% in 1999. This is not unexpected, because with
income growth, Indians, like consumers elsewhere, have started spending more on
non-food items compared with food products. Sales through supermarkets and
department stores are small compared with overall retail sales. Nevertheless, their
sales have grown much more rapidly, at almost a triple rate (about 30% per year
during the review period). This high acceleration in sales through modern retail
formats is expected to continue during the next few years, with the rapid growth in
numbers of such outlets due to consumer demand and business potential. The factors
responsible for the development of the retail sector in India can be broadly
summarized as follows:

• Rising incomes and improvements in infrastructure are enlarging consumer


markets and accelerating the convergence of consumer tastes. Looking at income
classification, the National Council of Applied Economic Research
(NCAER) classified approximately 50% of the Indian population as low income in
1994- 95; this is expected to decline to 17.8% by 2006-07.

• Liberalization of the Indian economy which has led to the opening up of the
market for consumer goods has helped the MNC brands like Kellogg’s, Unilever,
Nestle, etc. to make significant inroads into the vast consumer market by offering a
wide range of choices to the Indian consumers.
• Shift in consumer demand to foreign brands like McDonalds, Sony, Panasonic, etc.
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• The internet revolution is making the Indian consumer more accessible to the
growing influences of domestic and foreign retail chains. Reach of satellite T.V.
channels is helping in creating awareness about global products for local markets.
About 47% of India’s population is under the age of 20; and this will increase to
55% by 2015. This young population, which is technology-savvy, watch more than
50 TV satellite channels, and display the highest propensity to spend, will
immensely contribute to the growth of the retail sector in the country. As India
continues to get strongly integrated with the world economy riding the waves of
globalization, the retail sector is bound to take big leaps in the years to come. The
Indian retail sector is estimated to have a market size of about $ 180 billion; but the
organised sector represents only 2% share of this market. Most of the organised
retailing in the country has just started recently, and has been concentrated mainly in
the metro cities. India is the last large Asian economy to liberalize its retail sector.
In Thailand, more than40% of all consumer goods are sold through the super
markets and departmental stores. A similar phenomenon has swept through all other
Asian countries. Organised retailing in India has a huge scope because of the vast
market and the growing consciousness of the Consumer about product quality and
services. A study conducted by Fitch, expects the organized retail industry to
continue to grow rapidly, especially through increased levels of penetration in larger
towns and metros and also as it begins to spread to smaller cities and B class towns.
Fuelling this growth is the Growth in development of the retail-specific properties
and malls. According to the estimates available with Fitch, close to 25mn sq. ft. of
retail space is being developed and will be available for occupation over the next 36-
48 months. Fitch expects organized retail to capture 15%-20% market share by
2010. A McKinsey report on India says organised retailing would increase the
efficiency and productivity of entire gamut of economic activities, and would help
in achieving higher GDP growth. At 6%, the share of employment of retail in India
is low, even when compared to Brazil (14%), and Poland (12%).

Growth of Indian Retail:


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According to the 8th Annual Global Retail Development Index (GRDI) of AT
Kearney, India retail industry is the most promising emerging market for
investment. In 2007, the retail trade in India had a share of 8-10% in the GDP
(Gross Domestic Product) of the country. In 2009, it rose to 12%. It is also expected
to reach 22% by 2010.

According to a report by Northbride Capita, the India retail industry is expected to


grow to US$ 700 billion by 2010. By the same time, the organized sector will be
20% of the total market share. It can be mentioned here that, the share of organized

Different Forms of Retailing: Emergence of new formats of


Retailing in India

• Popular Formats:

• Hypermarts
• Large supermarkets, typically (3,500 - 5,000 sq. ft)
• Mini supermarkets, typically (1,000 - 2,000 sq. ft)
• Convenience store, typically (750 - 1,000 sq. ft)
• Discount/shopping list grocer
• Traditional retailers trying to reinvent by introducing self-service formats as
well as value-added services such as credit, free home delivery etc. The Indian
retail sector can be broadly classified into:

a) Food Retailers
There are large number and variety of retailers in the food-retailing sector.
Traditional types of retailers, who operate small single-outlet businesses mainly
using family labour, dominate this sector .In comparison, super markets account
for a small proportion of food sales in India. However the growth rate of super
market sales has being significant in recent years because greater numbers of
higher income Indians prefer to shop at super markets due to higher standards of
hygiene and attractive ambience.
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Examples of Food Retail outlets:


Below are some of the well known Food Retailers

Goods being displayed in the Vegetable market.

Goods being displayed in a super market.

b) Health &
Beauty
Products
With growth in income levels, Indians have started spending more on health and
Beauty products .Here also small, single-outlet retailers dominate the market.
However in recent years, a few retail chains specializing in these products have
come into the market. Although these retail chains account for only a small share
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of the total market , their business is expected to grow significantly in the
future due to the growing quality consciousness of buyers for these products .

Examples of Health care products in a Retail Outlet.

Beauty products being displayed in a departmental store & a body care store.

c) Clothing & Footwear


Numerous clothing and footwear shops in shopping centers and markets operate
all over India. Traditional outlets stock a limited range of cheap and popular
items; in contrast, modern clothing and footwear stores have modern products
and attractive displays to lure customers. However, with rapid urbanization, and
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changing patterns of consumer tastes and preferences, it is unlikely that the
traditional outlets will survive the test of time.

Examples of Garment Retail Outlets:

Examples of Footwear Retail Outlets:

d) Home Furniture & Household Goods


Small retailers again dominate this sector. Despite the large size of this market,
very few large and modern retailers have established specialized stores for these
products. However there is considerable potential for the entry or expansion of
Specialized retail chains in the country.
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Examples of Furniture Retail store:

Examples of Household Retail


store:

e) Durable Goods
The Indian durable goods sector has seen the entry of a large number of foreign
Companies during the post liberalization period. A greater variety of consumer
Electronic items and household appliances became available to the Indian
customer. Intense competition among companies to sell their brands provided a
strong impetus to the growth for retailers doing business in this sector.

Examples of Durable Goods:


Consumer Electronic goods Store:
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f) Leisure & Personal Goods


Increasing household incomes due
to better economic opportunities
have encouraged consumer
expenditure on leisure and personal goods in the country. There are specialized
retailers for each category of products (books, music products, Etc.) in this
sector. Another prominent feature of this sector is popularity of franchising
agreements between established manufacturers and retailers.

Examples of Leisure & Personal Goods Retail Outlets:


Personal Goods:

Leisure Goods:
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Definition of a Retailer:
“a business which sells goods to the consumer, as opposed to a wholesaler or
supplier which normally sell their goods to another business.” Retailers
include large businesses such as Wal-Mart, and also smaller, non-chain
locations run independently such as a family-run bookstore.

2. Consumer Durables

Consumer durables are the products whose life expectancy is at least 3 years. These
products are hard goods that cannot be used up at once. Consumer durables involve
any type of products purchased by consumers that are manufactured for long-term
use. As opposed to many goods that are intended for consumption in the short term
Consumer Durables are intended to endure regular usage for several years or longer
before replacement of the consumer product is required. Just about every household
will contain at least a few items that may be properly considered to be of a
consumer durable nature. One of the most common of all consumer durables would
be the furniture found in the home. This would include items such as sofas, chairs,
tables, bed frames, and storage pieces such as chests of drawers and bookshelf units.
While once thought to be limited to only items made of sturdy metal or wood, any
type of furniture today that is intended for use over the period of at least a few years
can rightly be classified as consumer durables.

Another common example of customer durables in the possession of most


households is appliances. These items may include ovens, refrigerators, toasters, and
gas or electric water heaters. Consumer Durables of this type are intended for use on
a continuing basis, and often are sold with some type of warranty or service contract
that helps to ensure the appliance will continue working for an appreciable period of
time.
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The family car is also understood to be among the
various consumer durables owned by many households. Considered a major
investment by many consumers, the expectation is that the vehicle will remain
operational for at least the amount of time it takes for the consumer to pay off any
loans associated with the acquisition. Further, consumers anticipate that the vehicle
can be utilized on a regular basis without fear of being destroyed by the frequent
usage.

3. Demand Creation

The business process flow is: Business plan to potential customer; potential
customer to sales; sales to product design (if applicable), product design to produce
and deliver (if applicable); produce and deliver to customer and customer to bank.
The exact flow depends on the particular business model adopted. With this
approach, there would be one process that creates a demand for the organizations
products and services and another that fulfils that demand. These are often referred
to as marketing and production but these are labels given to departments therefore
we need a different term to avoid confusion. A suitable name for the process that
creates a demand might be Demand creation process. Other names might be
marketing process or Sales and Marketing Process.

Demand Creation Strategies:


One of marketing's most critical roles is to develop demand. Through a combination
of business processes, integrated marketing campaigns and lead development tools,
a demand center must be established to drive demand in quantifiable measures and
to clearly demonstrate the impact on topline revenue.
Demand creation is constantly evolving, and requires unique operational insight to
ensure that all its elements are fully optimized. New strategies, technologies and
tactics are available for marketing evaluation; best practices are ready and waiting to
be explored and implemented; benchmark data is a necessity to demonstrate the
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success of the demand center against industry peers; and finally, innovative
strategies should be consider to effectively integrate with and optimize sales.
Demand Creation Strategies (DCS) provides senior marketing management with
operational intelligence on demand creation to support today’s strategic and tactical
lead development initiatives. DCS compliments Executive Edge, our flagship
advisory service, by combining benchmark data on lead development, analytic
decision models designed to assist in the evaluation of your lead development
programs, and thought-provoking research to support effective decision-making.

Purpose:
Penetrates new markets and exploits existing markets with products and a
promotional strategy that influences decision makers and attracts potential
customers to the organization. New product development would form part of this
process if the business were market driven.
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4. Market Players under Car Audio Segment
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Sony’s Story

It was in 1946 that Masaru Ibuka and Akio Morita together with a small team of
passionate and committed group of employees started to build “Tokyo Tsushin
Kenkyujo” (Totsuko), or “Tokyo Telecommunications Research Institute” to the
billion dollar global conglomerate that it is today. The main objective of the
company was to design and create innovative products which would benefit the
people.

Overview

One of the most recognized brand names in the world today, Sony Corporation,
Japan, established its India operations in November 1994, focusing on the
sales and marketing of Sony products in the country. In a span of 15 years
Sony India has exemplified the quest for excellence in the world of digital
lifestyle becoming the country’s foremost consumer electronics brand.
With relentless commitment to quality, consistent dedication to customer
satisfaction and unparalleled standards of service, Sony India is recognized
as a benchmark for new age technology, superior quality, digital concepts
and personalized service that has ensured loyal customers and nation wide
acclaim in the industry.

With brands names such as BRAVIA, BRAVIA Theatre, Cyber-


shot‚ Handycam®, VAIO, Walkman®, Xplod, Memory
Stick™‚ PlayStation®. Sony has established it self as a value leader across
its various product categories of Audio/Visual Entertainment products,
Information and Communications‚ Recording Media, Business and
Professional products.
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In India, Sony has its footprint across all major towns and cities through a
distribution network comprising of over 5000 dealers and distributors, 240
exclusive Sony outlets and 19 direct branch locations. Manned by customer
friendly and informed sales persons, Sony’s exclusive stores ‘Sony Center’
are fast becoming the most visible face of the company in India.

Sony India also has a strong service presence across the country with 20 company
owned and 190 authorized service centers and 16 exclusive demonstration
centers. A distinctive feature of Sony’s service is its highly motivated and well-
trained staff that provides the kind of attentive and sensitive service that is rare
today.

Sony is committed to ensuring that both the products and the marketing
activities employed truly make a difference to people’s lifestyles and offer them
new dimensions of enjoyment.

In-Car Entertainment
If you spend long hours in your car everyday, it’s important to equip it with enough
entertainment so that you’ll have nary a dull moment. Car audio entertainment need
not be limited to just your favourite radio stations or CDs. Thanks to Sony Xplod
mobile entertainment technology, you can enjoy music from more sources. You now
can even experience visual entertainment with our innovative Touch-Screen
Multimedia Centre receiver. Riding the car is never the same experience again.
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SONY Products
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Company Overview
Pioneer Electronics (USA) Inc. designs, develops, manufactures, and sells audio and
video products for home, car, and business markets. It offers home entertainment
products, such as displays, TVs, monitors, projectors, and accessories; car
audio/video products, which include in-dash receivers, speakers, subwoofers,
amplifiers, and accessories and add-ons; and Blu-ray discs and DVDs, satellite
radios, home theater systems, headphones, iPod/iPhone accessories, tabletop and
dual players, media players/controllers, mixers, effectors, and software, as well as
car navigation products. The company also provides business products, including
professional video products and speakers, replacement parts, A/V receivers, audio
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components, plasma displays, and professional DVDs, as well as multi-format
digital turntables for laptops to access music files. It sells its products through
authorized dealers and Internet stores in the United States and Canada, as well as
sells its products online. The company was incorporated in 1982 and is based in
Long Beach, California. It operates retail stores in Orange County, California; and
Phoenix, Arizona. Pioneer Electronics (USA) Inc. operates as a subsidiary of
Pioneer North America, Inc.

Global Vision

Group Philosophy
“Move the heart and touch the soul.”

Group Vision

To become a company that encourages all its members to work as a team, with
everyone customer-focused, integrating each one’s professionalism in pursuing
innovations one after another.
Pioneer aims to continuously provide excitement and passion to customers around
the globe, searching new ways to push the boundaries of what “sound, vision and
information” can offer beyond expectations.
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With that goal in mind, each and every member in all corners of the Pioneer
Group is being asked to keep generating ideas for improvement in their respective
areas.

These ongoing individual efforts at self-improvement will collectively help the


entire Pioneer Group bring about a new level of achievement and will lead it to offer
such lasting value to its customers as they have never experienced before.

Pioneer is committed to turning one idea after another into solid reality for its valued
customers through innovations that make the unthinkable thinkable and the
impossible possible.

The Vision

Pioneer India Electronics Pvt. Ltd., the regional headquarters of Pioneer


Corporation, has been designated to spearhead the growth and direction of our
global design team with specific emphasis on the design of entertainment products
of appeal to the international masses.

We seek to maximize the fun and enjoyment of entertainment which is best


encapsulated in our Corporate Vision.

Pioneer Products
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36

Corporate goal
Since its establishment in 1927, JVC has upheld a corporate philosophy
to contribute to culture and to serve society through its products and business
practices. This philosophy also guides us at the heart of everything we do in JVC
ASIA.

With the digital age changing the way information and entertainment are being
experienced, JVC ASIA is fast positioning itself as a leading entertainment solution
company in Asia. Our greatest corporate asset is the synergistic power of advanced
hardware technology with our extensive expertise in entertainment software and
media. We are making every effort to link this asset with user needs in order to
create a new generation of products and services that enrich lives around the region.
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While technology development is our core strength, our superior brand
performance is built through the combined effort of all our corporate activities. At
JVC, our people are focused on delivering our brand promise throughout the value
chain covering high-quality manufacturing, astute formulation of lifestyle ideas,
outstanding response to customer needs and much more.

Today we have eight sales subsidiaries in Asia, Oceania, the Middle East and Africa
and collaborate with seven other manufacturing companies. Each of these operations
is committed to making a vital contribution to its respective local community,
including sponsoring artistic, cultural and sporting Endeavour’s that inspire and
excite.

As a pioneer, we continue to create new ways to communicate through music and


images. As a corporate citizen, we continue to play an active role in our
communities. Our progress will ensure we will always deliver The Perfect
Experience as our contribution to culture and society.

JVC is a global entertainment solution company from Japan. Since 1927, we have
created new ways to communicate through music and images through a diverse
array of innovative audio-visual products and services. Our technological leadership
is now recognised throughout the world.

JVC ASIA is one of four region-based operations established by JVC worldwide. As


a market-oriented operation, we undertake product development, manufacturing,
38
marketing, sales and services for a broad region spanning Asia, Oceania, the
Middle East and Africa. Headquartered in Singapore, JVC ASIA has eight sales
subsidiaries in Asia, Oceania, the Middle East and Africa and collaborates with
seven other manufacturing companies amounting to 15,000 employees.

JVC Products
39
40

Company profile

Harman International Industries, Incorporated engages in the development,


manufacture, and marketing of audio products and electronic systems worldwide.
The company operates in three segments: Automotive, Consumer, and Professional.
The Automotive segment designs, manufactures, and markets audio, electronic, and
infotainment systems for vehicle applications primarily to be installed as original
equipment by automotive manufacturers. Its infotainment systems include GPS
navigation, traffic information, voice-activated telephone and climate control, rear
seat entertainment, wireless Internet access, hard disk recording, MP3 playback, and
a high end branded audio system, as well as produces personal navigation devices.
The Consumer segment designs, manufactures, and markets audio, video, and
electronic systems for home, mobile, and multimedia applications. The Professional
segment designs, manufactures, and markets loudspeakers and electronic systems
used by audio professionals in concert halls, stadiums, airports, houses of worship,
and other public spaces, as well as products for recording, broadcast, cinema, and
music reproduction applications. Harman International Industries sells its products
primarily through audio/video specialty and retail chain stores. The company was
founded in 1980 and is headquartered in Washington, D.C.

Sahil International is India’s exclusive representative for “Harman International –


Consumer Division” among other brands. They are a leading consumer electronics
importer since 1999. Our portfolio of products includes Home Theatre, Car audio,
Headphones, Multimedia and DJ electronics.

Spread across the country through a robust sales network we aim to continuously
excel in sales and service support to our millions of satisfied customers.
In a short period the team at Sahil International has grown exponentially, backed by
41
a unique work ethic of informality and empowerment. We are the fastest growing
company by revenue and income in all our product segments due to innovations in
marketing, infrastructure development and prudent financial management.

JBL Products

Chapter 3
Data Analysis
42

&
Interpretation

Q2. What are the Brands the Retailers sell?

Figure: 3.1
43

SONY
16 Pioneer
JVC
14 JBL
Kenw ood
12 Xenos

10 Polkaudio
Fosgate
8 Rockford
Infinity
6 Alpine
Panasonic
4 Hertz

2 Blaukpunkt
Delphi
0 Prosound

Frequency Kicher
Chinese

Interpretation:

14.49%of the retailers sell SONY, Pioneer, JVC & JBL,


8.70% of the retailers sell Xenos,
7.25% of the retailers sell Polk Audio,
5.80% of the retailers sell Kenwood,
2.90% of the retailers sell Fosgate, Rockford & Alpine,
1.45% of the retailers sell Infinity, Panasonic, Hertz, Blaukpunkt, Delphi Prosound,
Kicher & Chinese brands.
44

Q3. Does the customer have the knowledge of the products?

Figure: 3.2

70

60

50

40
Yes
30 No

20

10

0
Frequency

Interpretation:

70% of the retailers agree that the customers have knowledge of the products,
30% of the retailers say that the customer comes with no knowledge of products.
45

Based on knowledge the customers are further divided into three.


They are depicted in the figure below:

Figure: 3.2.1

70

60

50

40 Good Knowledge
30 Average Knowledge
No knowledge
20

10

0
Frequency

Interpretation:

63.33% of the customers have good knowledge,


18.83% of the customers have no knowledge,
17.84% of the customers have average knowledge of the products.
46

Q4. What features of the product is the customer aware off?

Figure: 3.3

40
35
30 Mp3
25 USB
20 I Pod
15 Bluetooth
10 DVD
All
5
0
Frequency

Interpretation:

38.89% of the customers are aware of features like Mp3 & USB.
5.56% of the customers are aware of I Pod features.
5.55% of the customers are aware of DVD features, and about
11.11% of the customers are aware of almost all the features of the product.
47

Q5. If the customer has the knowledge of the products which brand he/she asks
for?

Figure: 3.4

40
35
30
25 SONY
20 Pioneer
15 JVC
JBL
10
5
0
Frequency

Interpretation:

38.46% of the customers demand Sony and Pioneer,


19.23% of the customers demand JVC and
3.85% of the customers demand JBL.
48

Q6. Does companies pricing policy affects sales/ demand?

Figure: 3.5

80
70
60
50
40 Yes
No
30
20
10
0
Frequency

Interpretation:

80% of the retailers think that the pricing policy of companies affects the sales.
20% of the retailers say that there is no effect on sales
49

Q7. Do you sell brands which yield more profit?

Figure: 3.6

70

60

50

40
Yes
30 No

20

10

0
Frequency

Interpretation:

30% of the retailers say yes they sell products that yield more profit,
70% of the retailers say no they do not sell products that yield more profit.
50

Q8. What strategies the organisation implements in enforcing you to persuade


the customer to buy a particular brand?

Figure: 3.7

50
45
40
35
Schemes
30
Foreign Trip
25
Discounts
20
Free Demo Rack
15
Commission
10
5
0
Frequency

Interpretation:

47.37% of the retailers say companies come out with various schemes,
31.58% of the retailers say companies implement foreign trip schemes,
10.53% of the retailers say companies give commission to the retailers and
5.26% of the retailers say companies give free demo samples to persuade the
customer.
51

Q9. How do you persuade the customer to buy a particular brand?

Figure: 3.8

35

30
Suggesting Brands
Depending on Budget
25
Extra Discount

20 Demonstration

15 Give out more features at


less price
Previous customer
10 expariences
Moulding the mind
5

0
Frequency

Interpretation:

33.33% of the retailers give demonstrations,


26.67% of the retailers give extra discounts,
13.33% of the retailers suggest brands and mould the mind of the customer,
6.67% of the retailers try to give more features at less price and share previous
customer experiences.
52

Q10. What is the criteria on which the customer decides to buy a particular
brand?

Figure: 3.9

45
40 Brand
35
30 Quality &
Features
25
Price
20
15 Requirement &
10 Budget
5 Retailers
Experience
0
Frequency

Interpretation:

43.75% of the customers decide to buy a product by their brand name,


12.5% of the customers decide to buy a product based on their Quality and Features,
31.25% of the customers decide to buy a product by based on their requirements and
budget.
12.5% of the customers decide to buy a product via retailers own experience.
53

Chapter 4
Summary
54

1. Findings

 Out of the brands available in the market Sony, Pioneer, JVC, JBL are the
common brands sold by every retailer. Brands like Kenwood, Xenos, Polk
Audio, Rock Ford, Infinity, Alpine, Panasonic, Blaukpunkt, etc are not
commonly sold by every retailer. This is because, a major part of consumers
having access to this segment have good knowledge of products and are
Premium Brand customers.

 70% of the retailers agree that the customers have knowledge of the products,
and

30% of the retailers say that the customer comes with no knowledge of products.

Study also reveals that


63.33% of the customers have good knowledge,

18.83% of the customers have no knowledge,

17.84% of the customers have average knowledge of the products.

 38.89% of the customers are aware of features like Mp3 & USB.

5.56% of the customers are aware of I Pod features.

5.55% of the customers are aware of DVD features, and about


55
11.11% of the customers are aware of almost all the features of the product.
 38.46% of the customers demand Sony and Pioneer,

19.23% of the customers demand JVC and

3.85% of the customers demand JBL.

 According to the retailers,


80% of the retailers think that the pricing policy of companies affects the sales.
This is because, when the pricing policies change the retailers have to re-
structure their discounting schemes, and profit margins.
20% of the retailers say that there is no effect on sales, when there is a change in
the pricing policy of the companies. This is because they predict and prepare
themselves for the change.

 30% of the retailers say that they try to sellout brands with higher margins
of profit and are successful at doing that.

70% of the retailers say that they do not try to push out brands with higher
margin of profit. They believe that customer satisfaction is the ultimate tool to
earn profit. Once a customer is satisfied, an already existing customer may refer
the retailer to others, indirectly attract new customers.

 47.37% of the retailers say market players come out with various schemes
by which a retailer decides as how much of stock should he maintain and
accordingly try persuading and selling brands in order to yield more profit.

31.58% of retailers say that competitors come out with gift packages on
achieving target sales volume on such brands, which encourage them to sell a
56
particular brand. It is left to the retailer as to what gift package he desires to
target. 5.26% of the retailers say, competitors offer them discounts. This enables
them to earn a higher margin of profit and they try to sell only those brands.

5.26% of the retailers say that fewer organisations give out free demo samples.
This attracts the customer to buy that product.

10.53% of the retailers say that organisations give commission on turnover


achieved by them.

 13.33% of the retailers suggest brands to the customers depending on their


budget and insisting them to buy a particular brand.

26.67% of the retailers give extra discounts to the customer, which a customer
generally looks for.

33.33% of the retailers give demonstration of features and sometimes sound


clarity, comparing and suggesting him to purchase a particular brand.

6.67% of the retailers try suggesting the customers, the brands that offer more
features at less price.

6.67% of the retailers share experiences of customers already existing.

13.33% of the retailers try to mould the mind of the customer, shifting his
preference from one brand to other brands.
57
 43.75% of the customers decide to buy a product by their brand name,

12.5% of the customers decide to buy a product based on their Quality and
Features,
31.25% of the customers decide to buy a product by based on their requirements
and budget,

12.5% of the customers decide to buy a product via retailers own experience.

 For 18.83% of the customers who have no knowledge, retailers


successfully creates demand for certain brands. Though profit making is the
ultimate goal of any business, but ultimately customer satisfaction plays a key
role for further access to new customers.

2. Conclusions

 In reference to Question 8, the organisations implement the following


strategies in enforcing the retailer to persuade the customer to buy a particular
brand.

1. Foreign trip schemes: Retailers are awarded with all expenses paid
foreign trip (only boarding and stay charges). These schemes are
awarded to only those retailers who achieve a specified turn over in
selling a particular model of product.

2. Glow signs: Retailers are provided with company glow signs with
retailers name printed on it. This enables the retailer to attract the
customers by glow signs and ask for that particular brand.
58

3. Branding: The retailers are branded with company’s name and give
attractive discounts to the retailers on product models. As discussed
earlier a premium brand customer who always looks out for premium
brand can easily notice these retail outlets and ask for that particular
brand.

4. Dealer Training: The dealers are trained by the companies. When a


new product with new technology is launched into the market, the
companies train the retailers in every aspect of the product viz: features,
who to use and benefits.

5. Dealer Incentive: Dealers are given incentives by the companies,


such as commission, model wise discounts, free gifts like: Televisions,
Music players, Home theatre systems, Cameras etc.

6. Schemes: Schemes are the most common way of persuasion, different


companies offer different schemes to the retailers. As there is no higher
margin of profit in branded products, the companies try to frame their
scheme pricing policies in such a way, so as to give out a higher margin
of profit as compared to their competitors.

7. Demo rack: The retailers are provided with company’s demo rack.
Demo rack consists of all the models of the company displayed so that
the customers can have a practical experience of the products and the
customers can decide as what they want to buy.
59
Apart from the above strategies the organisations also implement promotional
strategies on the customers. They are customary offers like free pendrives, Mp3
CD’s, free t-shirts.
 There are three types of customers existing in this type of market. They are:
a. Premium Brand customers
b. Feature and Technical based customers
c. Economical customer

A Premium Brand customer is one who has a thorough knowledge of the


products and brands available in the market. These customers are brand loyal
and always demand branded goods (by its brand image in the market or with a
belief that branded goods are good quality goods).
A Feature and Technical based customer is one who demands for some
specific Feature or Technology in goods. He then makes his choice based on the
options available to him.
An Economical based customer is one who looks out for economical
pricing of products. These customers are budget based and generally come to
market with a specific budget. They have average knowledge of products and
generally look out to buy product that possess more features at economical price.

 Retailer’s role in demand creation is very significant; retailer is a source of


information and experience to the customers who have no knowledge of the
products under the Car Audio segment. Retailers create demand for certain
brands by moulding the mind of the customer. Customers who possess car have
access to this segment, standard of living is on a rise and people are now moving
towards transition. This transition is led by rise in income in the economy,
people are now slowly moving towards luxurious goods. Today people having
incomes between 3 and above can afford for a car. This has lead to increase in
demand for such products.
60
 According to the retailers, organisations operating under this segment do
not incur heavy advertising expense which is not true. Organisations under this
segment incur heavy expenses on advertisements; this is because the retailers are
not aware of the organisational strategies of promotions. Organisations promote
their products through advertisements in newspapers, magazines, television
media, hoardings etc.

 Customers who possess knowledge are generally those customers who have
purchased these products earlier.

 In this segment the market players cannot afford to take up higher


advertisement costs, as the goods sold under this segment are automotive
entertainment system. People who possess car have access to such products and
thus, demand is low.

 Market leaders like SONY, JVC, Pioneer, JBL, and Blaukpunkt can afford
to advertise their products; this is because these are the market players who
occupy a major market share.

 Products sold by Market players are economical in price and fits into the
common budget for Economical customers.

 Persuading a customer to buy, what retailer intends the customer to buy is


an art of retailer. Retailers are masters at diverting the mind of the customers.
Market players under this segment compete each other in formulating new
61
pricing strategies and schemes so as to increase the profit margin of the
retailer and encouraging him to suggest and sell more of their products.

3. Suggestions

 Customers do not tend to buy certain brands because of their bad after sale
service. The organisations should focus on improving it’s after sales services for
the customers. This is essential to occupy a large market share and creating a
brand image in the market.

 Organisations should be concentrating on influencing the retailers interest.


This will enable them to push out more and more products through retailers.
62

Bibliography

The Secondary data has been collected through the following sources:

• www.google.co.in
• www.businessdictionary.com
• www.wikipedia.com
• The Retailer's Role in Quality Retailing - The Emerging Scenario in India.
(www.ezinearticles.com)

Role of Retailers in Shaping a Firm’s Strategic Direction. (Submitted in partial


Fulfillment of the Requirement for the Award of Degree in
Doctor of Philosophy in Business Administration, School of
Business, University of Nairobi) by PETER MUGO.

• Automobile magazines.
• Newspapers: Times of India.
63

Annexure

Questionnaire
Retailers Role in Demand Creation
(In Case of Car Audio segment)

1. Name of the Retailer:

2. Brands he sells:

3. Does the customer has the knowledge of the products:

4. What features of the product is the customer aware off:

5. If the customer has the knowledge of the products which brand He/She asks
for:

6. Does companies pricing policy affect Sales/Demand:

7. Do you sell brands which yield more profit:

8. What strategies the organization implement in enforcing you to persuade the


customer, to buy a particular brand:

9. How do you persuade the customer to buy a particular brand:

10. What is the criteria on which the customer decides to buy a particular brand:

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