Final Report

MARKETING STRATEGY OF NEW ENTRANT

IN AIR CONDITIONER MARKET

At

TECUMSEH PRODUCTS INDIA Ltd...

Submitted by

B. Sree

Venkatesh

1225111307

INDEX

Industry Profile 2

Organisational Profile 3

The Present Study/Methodology

I. Objectives of study 6

II. Research design 6

III. Limitations of the study 7

Analysis of Study

a. CONSUMER ANALYSIS 9

b. PRICE ANALYSIS 18

Findings 37

Suggestions (strategy) 47

Annexure 53

INDUSTRY PROFILE

1

ROOM AIRCONDITIONERS:

Air conditioning equipment includes central air conditioning equipment and room air conditioners. Central air conditioning system is being used by large industries, large commercial houses and luxury hotels. But use of room air conditioners is more common in households, offices, shops, hotels etc. today the market is flooded with various models and wide range of capacities. With time moving on, more and more sophisticated electronic processes are used for better temperature control, remote operation and convenience.

The production of air conditioners started in India in 1965 with a small base. At present, there are about 17 or 18 units in the organized sector manufacturing room air conditioners in India. Besides there are many units in the small scale sector also. The production of room air conditioners in the organized sector was stagnant at around 35 to 40 thousand numbers till 1992-93. But with continuous reduction in excise duty by government of India, the production of room air conditioners from this picked up. On the other hand, with the increase in the production room organized sector, the share of small scale declining from 70 percent in 1990-91 to 35 percent in 2001-02. The total production of room air conditioners however has increased to 1.17 lakh numbers in 190-91 to 6.11 lakh numbers in 2000-01. However in 2001-02 it declined to 5.74lakhs. The average growth rate was found at 15.56 percent per annum during the period under study. Lg, Samsung, Voltas, Videocon, Hitachi, bluestar are the largest manufacturers sharing more than 85-90 percent of total production of air conditioners in India.

As far as foreign trade is concerned, the imports are found to be very small till 1996-97. However it started increasing by 2001-02 it reached to 49787 numbers valuing to Rs.4779.43 lakhs. The imports are sourced mainly from Korea and Thailand. These two countries together have more than 80 percent of the total imports of room air conditioners. The imports were also sourced from Philippines, Japan, Malaysia, Chinese Taipei, Netherland, Saudi Arab, Singapore, UAE etc. The exports have been made in small quantity less than 1 percent of total production in most of the years during last decade. The exports were in the range of 1.0 to 3.5 tons in most of the years during last decade. The major destinations for exports are UAE, Oman, Nepal, Greece, Srilanka, Singapore, Zambia, Bahrain, Bangladesh and France.

As imports and exports are in small quantity the consumption of room air conditioners were almost equivalent to its production till 1998-99. The consumption of room air conditioners has continuously increased from 1.17lakhs in 1990-91 to 2.75 lakhs during 1995-96. However the consumption remains stagnant at about 2.75 lakhs during 1995-96 to 1997-98. But growing consumerism, increasing availability and rising standard of living provided good boost to the consumption and the same has increased quite rapidly and each to 6.19lakhs by 2001-02. The average growth rate is found at 16.35 percent per annum during the period under study. The total installation of air conditioners in India by 2001-02 is estimated about 39.46 lakhs. Household sector is the largest consumer sector sharing almost 55 percent of room air conditioners followed by business houses and offices sharing 30 percent and hotels, restaurants, guest houses, shops, hospitals, etc sharing 15 percent of the total installation. Comparing this consumption with huge size of population in the country, rapid expansion of business houses, hotel etc, and the total number of air conditioners in use look quite small.

As far as future is concerned few developments are important:

1. Growing information technology industry will help demand for room air conditioners to grow.2. The popularity of air coolers has declined recently to a significant extent and air conditioners

have once again procured the prime place.3. However the economy is still facing depression and financial crisis and the fear of large

employment is booming.

2

4. The middle class population is more than 100 million numbers and with increase in installation, base market is likely to move towards saturation.

5. The globalization of the economy will also contribute to the increase in demand for room conditioners.

6. More over wider availability of consumer finance will also motivate people to buy more of such type equipment.

7. Business houses and offices have accepted the new concept of automation and modernization which is definite to increase the demand for room air conditioners.

Looking to all these factors, it is estimated that the demand for room air conditioners from household sector will increase at the rate of 10 percent per annum, from business houses and offices at the rate of 12 percent per annum and from other endues at the rate of 10 percent per annum. Replacement demand is very small till today and even in future, it is estimated to be 5 percent of the total demand. However any new change in technical parameters or appearance may increase replacement demand to higher level. Accordingly the demand for room air conditioners is estimated to increase at about 11.91 lakh numbers by 2005-06.

As against this demand some of the leading units are thinking of expanding their capacities. Besides this two, three other units are also in process f expanding capacity. The total capacity in pipeline is of 350 lakh numbers. If it is estimated that 80 percent of this capacity would be utilized, the total supply would be 9.54lakh numbers by 2010-11. This will keep a demand supply gap of 3.37lakh numbers for which an additional capacity of 4.21lakh numbers by 2010-11. This will keep the demand gap by 3.37lakh numbers would be required. Hence there is a good scope for new investment.

TECUMSEH PRODUCTS COMPANY

Company history:

Tecumseh Products Company started in 1930 when Ray W. Herrick opened the Hillsdate, Michigan. A former employee of the Ford Motor Company, Ray Herrick initially produced parts for automobiles, as well as electric components, small tools and toys/ in 1934 the company moved to Tecumseh, Michigan a small town 60miles southwest of Detroit and Ray Herrick renamed his company after its new hometown. In 1937 the company went public with an offering 25000 shares.

If wasn’t long before the company realized the future of Tecumseh products company was not in the automobile industry, but in the burgeoning new refrigeration industry. By 1939, Tecumseh turned out 160,000 compressors a year for mechanical refrigerators. Compressor production halted during World War II as the company’s output switched to shell casings. When the war ended in 1945, Tecumseh resumed manufacturing compressors, expending its product has to include compressors for window air conditioners in 1947. In the 1950’s the company acquired two Wisconsin-based small engine manufacturers, Lauson Engine and Power Products. The addition of these two companies made Tecumseh an important presence in the expanding outdoor power equipment industry. Other acquisitions and partnerships were to follow, including two pump operations and several significant foreign operations. Today, Tecumseh has over 30 principal locations producing compressors, engine and pumps world-wide, with facilities in Brazil, Canada, France, India, Italy and the U.S.

3

A global multinational fortune 500 corporation producing mechanical and electrical components essential to industries creating end-products for health, comfort and convenience. Tecumseh means a “CROUCHING PANTHER” derived from chief of the Shawnee tribe (1768-1813)

Ray.w. Herrick founded the TECUMSEH PRODUCTS Company in 1932. Tecumseh Products Company is a full line, independent global manufacturer of hermetic compressors for air conditioning and refrigeration products, gasoline engines and power train components for lawn and garden applications, and pumps. Our products are sold in over 100 countries around the world.

The company has proposed by providing high quality, competitively priced products global basis. We have a sixty-year history of growth successful development and application of new technologies and through acquisitions. Our sound financial basis allows us to exploit technological and strategic opportunities in order to maximum share holder’s value.

Products are grouped into the principal industry segments:

Compressor products Engine and Power Train Products and Pump Products

Mission

Be recognized as the world leader in the supply of the refrigeration and air conditioning compressors.

Our Commitments

Provide Our Customers Superior quality on Products, service and value. Create an environment in which our employees can demonstrate their potential and make

difference. Provide superior value to our shareholders Reach the highest possible standard of excellence in all of our endeavors through the process

of continuous improvement. Conduct our business with uncompromising integrity. Attain clear technology leadership Establish worldwide communications and cooperation to all companies resulting in better

product and service for our customers.

The Company will strive on

Work with all Government entities for the development entities for the development of technically sound and financially responsible environment laws and regulations.

Integrate responsible environmental stewardship in company planning and decision-making

Recognize that protection of the environment is a company-wide priority, requiring acceptance of responsibility by Management and employees at all level within the company.

Evaluate current technology, products and raw materials for waste minimization and review proper handling and disposal techniques for existing wastes.

Consider the environment effect of decisions relating to manufacturing processed and operations, purchasing and supply, real estate transactions and plant site development.

4

This policy statement confirms the company’s intent to create and implement sound environment management policies and to encourage those with whom it does business to do the same.

They Manufacture and Marketer

Hermetic Compressors for refrigeration’s, freezers, water coolers, dehumidifier’s window air conditioning unit’s residential and commercial central air conditioners and heat pumps

Gasoline Engines for lawn movers……… lawn and garden tractors……… garden tillers ……… string trimmers…….. Show throwers ………….. Industrial and agricultural applications ………… and recreational vehicles.

Transmission, Transaxles and differential for lawn and garden equipment… and recreational vehicles.

Centrifugal pumps, sump pumps and Small SUBMERSIBLE pumps for industrial, commercial, marine, agricultural applications. Tecumseh Products Company is the only full line independent manufacturer of compressors in the world.

Nobody services all the worldwide market segments like they do.

Foreign licenses:

James N.Kirby Ltd., revesby, N.S.W., Ausria China North Industries Corporation (NORINCO) Chongging, china. Compressors Andinos SA, Bogota, Colombia. Hermitic dad S.A.de C.V, Mexico City, Mexico. PZL-Hydral Wroclaw, Poland. Turk Electril Endustri, A. Istanbul, Turkey. VENCOMESA Venezuela de Compressors Motores, Caracas, Venezuela.

Subsidiaries:

L’Unit Hermetique S.A.Paris, France Tecumseh do Brazil, Sao Carlos, Brazil Tecumseh Products of Canada Ltd, London, Ontario, Canada Virtus, Inc. Pawtuket, Rhode Island Tecumseh India, Hyderabad and Ballabhgarh

OBJECTIVES OF THE STUDY

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Primary Objective The main purpose of this study is to determine marketing strategy that is to be adopted by the

company to achieve its targets.

Secondary Objective

The secondary objective of the research is to find the image of the company among the customers.

In brief Objectives include-

Analyzing the Market of Air conditioners Identifying potential market for launching new product Designing a market strategy

RESEARCH METHODOLOGY

Secondary Data

I have used the secondary data relating to air conditioners available in the market. And have collected following information about various ranges the company has, the technology being used by company, their marketing strategies & information about the competitors.

Primary Data

I have used personal interviewing where primary data can be directly collected from respondents. The desired information was secured using Questionnaire.

At times I also asked questions as to why the respondent has chosen AC of a particular company or what made him feel about that choice. I was keen to ensure that the respondent was taking interest while filling the questionnaire. This ensured collection of unbiased and accurate data.

To know the brand awareness, consumer perception about Tecumseh and their satisfaction level, the consumer personal survey was undertaken which was based on non-disguised structure questionnaire.

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LIMITATIONS

Some of the dealers as well as the customers were not forthcoming with information as they thought it to be a waste of time. Some customers were not able to respond due to lack of awareness.

1) A number of dealers were biased towards a particular brand which was giving them better returns.

2) Some of the shop owners were not available so, contacted person was not able to present a fair view.

3) Respondent’s lack of time to give information and their casual attitude was a big hindrance in the study.

4) The dealers were biased by some recent experiences which they had with a particular distributor regarding the service or distribution.

FRAME WORK OF THE MARKETING STRATEGY7

ANALYSIS OF STUDY

8

Consumer analysis:

The Customer Analysis section of the marketing strategy assesses the customer segments that the company serves. In it, the company must

1. To identify the target customers

2. Convey the needs of these customers

3. Design and market the product according to their needs

1. Target customers- consumers

As Tecumseh is a new entrant in the market the decision on selection of target customers is taken based on the following factors.

Tecumseh has launched its product at the end of summer, so we have selected different business sectors who demand for the product throughout the year. Some of them are architects, interior designers and builders etc

Tecumseh is ready to manufacture only finite quantity of ACs initially so we have selected Hyderabad as our target place.

We have taken the opinions of different customers at multi-brand showrooms and business centers about their buying behavior on ACs.

Based on the above factors we have selected two sections of people as our target customers

1. Consumers/ Individuals

2. Businesses

Consumer analysis:-

To know about the requirements of the customers and their buying behavior we have designed a questionnaire and went to the target places. We have distributed the questionnaires to the customers around the targeted areas and requested them to fill them.

Sampling technique: - questionnaire

Sampling method: - random sampling method

Sample size: - 91

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Information based on questionnaire:-

We have designed the questionnaire to know the requirements of customers. Different aspects which we have concentrated are mentioned below,

Income levels of the individuals

Preferred price ranges

Capacity required

Features preferred

To know whether they are brand loyalists/ brand switchers

Preferred place of purchase

The above points would cover all the elements of marketing mix except the promotion which is to be planned the company internally.

My findings and observations:-

1. Income levels of individuals in the sample

2. Preferred price ranges

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lessthan 20000

20000-30000

30000-50000

greater than 50000

Individuals with their income range less than 20000 prefer for an Ac which is less than Rs.20000

Individuals with their income range of 20000-30000 are preferring for an Ac which is pricing between Rs.20000 and Rs.35000

Individuals with their income range of 30000-50000 are preferring for an Ac which is pricing between Rs.20000 and Rs.35000

Individuals with their income range greater than 50000 prefer for an Ac which is above Rs.35000 with inverter feature.

3. preferred capacity

4. Features preferred

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1Tr

1.5Tr

2Tr

preferred tonnage and price of AC 1tonneless than 25000=85.7%25000-35000=14.3%1.5tonneless than 25000=46.1%25000-35000=51.9%>35000=1.9%2tonne<25000= 16%25000-35000=40%>35000=44%

features preferred1 oscillating vents=292 sleep mode=423 ventilation/exhaust=274 automatic temperature control=735 energy saver switch=556 check filter light=27

5. Brand awareness of competitors among individuals

6. Preferred place of purchase

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0

10

20

30

40

50

60

70

80

1 2 3 4 5 6

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5

10

15

20

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30

35

LG

SAMSUNG

VOLT

AS

BLUESTAR

PANASONIC

WHIR

LPOO

L

HITACHI

O G

ENERAL

OTH

ERS

Series1

0

5

10

15

20

25

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Authorized outletsBusiness centers Multi brandShowrooms

Online shopping

2. Target customer- Businesses

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Studio One Architects:

Studio One Architects is full service, multi-discipline architecture, interior design and construction management firm founded by Anthony D’angelo, Aia and Robert A. Feinstein in 1999.

Studio one works with a team of highly professional consultants to provide our clients with a complete and thoroughly coordinated project. They utilize the last in CADD technology to aid in our design and production services. Their staff has diverse experience in commercial civic, educational and residential projects in design and construction. They maintain a commitment to excellence in design while working within client’s budget and helping them meet their construction deadlines.

My observations and findings:-

As a part of my project on B-B marketing, I went and met STUDIO ONE interior designers for some information on their projects and their buying behavior of ACs. The details that they have given are mentioned below,

CURRENT PROJECTS:-

1. Interior designing for VICAT SAGAR cement factory, tandur

2. 35000sft hospital at miryalguda

BUYING DECISION:-

In my interaction with Arvind Battapothu (official at studio one) he said that generally air conditioner buying decision is taken by them.

The clients of studio one request their suggestion for such decisions.

Studio One generally contacts consultancy for the requirements of ACs.

IMPORTANT NOTE:-

Their decision on ACs fitment for the current projects, they said they need to meet the technical expert team and then go with the suggestions given by the expert’s team.

The technical expert team of Tecumseh should consult them and work onsite for their projects.

NIVEE PROPERTIES:14

At Nivee Property, we stand by our motto and slogan, 'Bringing quality to life'. The homes we deliver are of the utmost quality with amenities that will empower your lifestyle and will let your chest swell up with pride whenever you mention the word “Home”. Our services in the development of projects are done for the upbringing of lifestyles that are all about quality living, exalted luxury and amenities that reflect opulence.

At Nivee Property, we believe in building homes that are more than just mere walls that give you privacy and shelter. Our homes revolve around our aspirations of “Bringing quality to life”, which is evident in our completed projects. Standing firmly by these principles and beliefs, we embarked on this journey in the year 2003 and we have been delivering quality homes ever since.


As a part of my project on B-B marketing, I went and met NIVEE PROPERTIES for some information on their projects and their buying behavior of ACs. The details that they have given are mentioned below,

CURRENT PROJECTS:-

1. Temple Bell residential apartments at Srinagar colony Hyderabad. It is a 5 storied building with gym and roof top garden available for small celebrations.

2. Pome Made residential apartments at Srinagar colony Hyderabad

BUYING DECISION:-

In my interaction with general manager, he said that generally air conditioner buying decision is taken by them based on brand image and price of the product

The clients of Nivee Properties request their suggestion for such decisions.

Nivee Property generally contacts two to three well known brands and grants contract to those companies who offer them at a low price.

IMPORTANT NOTE:-

Nivee Property generally contacts two to three well known brands and grants contract to those companies who offer them at a low price.

MURTHY AND MANYAM:

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We as a team endeavor to provide Quality and appropriate Turnkey Construction solutions satisfying client needs and have continual improvement of the Quality Management System. Our firm, Murty & Manyam, Architects & Engineers, is established in the year 1965. With over four decades of service in the nation building process by way of undertaking projects of national relevance.

We can confidently claim that we have the necessary expertise in conceptualizing, design, planning & implementation of major projects. The projects we have undertaken have been completed to the exacting standards and the tight schedules set forth by our respective clients. We have the distinction of handling some mega projects for the Defense Research & Development Organization (DRDO) through our associates M/s Graphics Designers, a firm constituted by the same partners primarily to maintain the classified nature of the assignments.


As a part of my project on B-B marketing, I went and met Mr. K.L.S.V.Prasad (project co-coordinator MEP) for some information on their projects and their buying behavior of ACs. The details that they have given are mentioned below,

CURRENT PROJECTS:-

1. STATE BANK OF INDIA

2. SYMBIOSIS INSTITUTE

BUYING DECISION:-

In my interaction with Mr. Prasad, he said that generally air conditioner buying decision is taken by them based on previous installations at different projects and price of the product

The clients of M&M request their suggestion for such decisions.

IMPORTANT NOTE:-

M&M generally consults the technical expert’s team and observe their previous projects and then take the decision on buying the product.

PENSHELL DESIGNS:

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The firm is emerging as an experienced, versatile design services provider with creative spaces & technical solution to achieve a built outdoor / interior environment.


As a part of my project on B-B marketing, I went and met Dheeraj Kumar for some information on their projects and their buying behavior of ACs. The details that they have given are mentioned below

BUYING DECISION:-

In my interaction with Mr. Dheeraj Kumar, he said that generally air conditioner buying decision is taken by them based on previous installations at different projects and price of the product

The clients of Penshell Designs request their suggestion for such decisions.

COMPETETOR ANALYSIS

17

Price analysis of competitors:

TONNAGE

STAR RATING COMPANY MODEL PRICE

1.5 2 HAIER HSU18LB2 18500

1.5 2 KORYO KSI18 AO3S 22990

1.5 2 ONIDA S18CFL-G3 25490

1.5 2 SAMSUNG MAXAS182UBJ 25700

1.5 2 GODREJ GSC18FP2WLZ 26990

1.5 2 SAMSUNG MAXAS182UBF 27300

1.5 2 WHIRLPOOL ELEGANCE 28000

1.5 2 VOLTAS PLATINUM 2S HOT N COLD 28650

1.5 2 LG LSA5MR2T 29000

1.5 2 SAMSUNG PURISTA 29500

1.5 2 BLUESTAR 2STARO 2HW180A 30139

1.5 2 SAMSUNG S PURISTA AS182BPG 31200

1.5 3 LLOYD FLS19A3C 17900

1.5 3 HAIER HSU12CA2 21500

1.5 3 ELECTROLUX EGS53 24490

1.5 3 KORYO KSIFLO 18 AF3S 24990

1.5 3 VIDEOCON VITA+ VS5F3.WV1 25990

1.5 3 ELECTROLUX SB53 26190

1.5 3 ONIDA TRENDY+ S12TRD4 26640

1.5 3 ELECTROLUX SS53 26690

1.5 3 WHIRLPOOL CHROME3 27990

1.5 3 LG LSA5MR3T 28700

1.5 3 LG LSA5UR3A1 28990

1.5 3 ONIDA POWERTRENDY S18TRD 28990

1.5 3 VOLTAS PLATINUM 3S 29930

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1.5 3 PANASONIC CS/CU-YC18NKY 30490

1.5 3 SAMSUNG MAXAS183UGF 31200

1.5 3 WHIRLPOOL AVIATOR3 31200

1.5 3 ONIDA TRENDY GOLD S18TRD 31640

1.5 3 ONIDA GLOSSY S18GLS-N4 32140

1.5 3 ONIDA DEOCOOL S18DEC4 32640

1.5 3 LG LSA5AR3T 33000

1.5 3 BLUESTAR 3START 3SW18TB 33500

1.5 3 WHIRLPOOL PROTTON 33500

1.5 3 VOLTAS TITANIUM 3S 33690

1.5 3 SAMSUNG PURISTA A+ AS183NF 33800

1.5 3 SAMSUNG S PURISTA AS183BPE 33900

1.5 3 HITACHI KAZE RAU318KSD 34600

1.5 3 LG LSA5TR3P 34990

1.5 3 SAMSUNG S CRYSTAL+ AS183EKE 35400

1.5 3 BLUESTAR 3STARV 3SW18VB 36000

1.5 3 LG LSA5EW3Z 37200

1.5 3 SAMSUNG PURISTA AS183BBF 37900

1.5 4 LLOYD FLS19A4M 20300

1.5 4 ONIDA S18FLT-N3 28890

1.5 4 ONIDA SPEEDCOOL S12SPDM3 30390

1.5 4 ONIDA SPEEDCOOL S18SPDN5 30990

1.5 4 ONIDA S18FLT-N5 30490

1.5 4 ONIDA S18FLT-N4 30890

1.5 4 ONIDA TRACY S18TRC5 33340

1.5 4 ONIDA S18MVDW5 33340

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1.5 4 SAMSUNG PURISTA AS184BBJ 34400

1.5 4 SAMSUNG S PURISTA AS184BPE 35400

1.5 4 SAMSUNG S CRYSTAL+ AS184EKE 37200

1.5 5 LLOYD FLS19A5G 26000

1.5 5 VIDEOCON VITA PRIMAVS5A5.WV1 27490

1.5 5 KORYO KSIPLT 18 AO5S 27990

1.5 5 VIDEOCON VITA PRIMA VS5K5RV1 28990

1.5 5 HAIER HSU 18CR03G5 29695

1.5 5 KORYO KSIMIR18AO5SMI 30990

1.5 5 ELECTROLUX SS55 31290

1.5 5 ELECTROLUX SR55 33790

1.5 5 ELECTROLUX SZ56 33791

1.5 5 WHIRLPOOL CHROME5 34250

1.5 5 WHIRLPOOL AVIATOR5 34250

1.5 5 ONIDA S18SLH 34340

1.5 5 SAMSUNG PURISTA AS185BBH 34900

1.5 5 LG LSA5MR5T 35000

1.5 5 VOLTAS GOLD 5SR 35260

1.5 5 LG LSA5UR5A 35300

1.5 5 HITACHI SUGOI RAU518HSDD 35490

1.5 5 VOLTAS PLATINUM 4S-5S 35936

1.5 5 LG LSA5AR5T 36000

1.5 5 SAMSUNG MAXAS185UGF 36600

1.5 5 PANASONIC TC18NKY 36990

1.5 5 LG LSA5ES5Z 37000

1.5 5 HITACHI ACE RAU518HSD 39023

1.5 5 BLUESTAR 5STAR ZWZS5HW18ZBW 39500

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1.5 5 BLUESTAR 5STAR ZWZS5HW18ZBS 39501

1.5 5 LG LSA5TR5P 39800

1.5 5 GODREJ CRYSTAL GSC18FV5 39990

1.5 5 GODREJ HARMONY GSC12FV5HRLH 39990

1.5 5 BLUESTAR 5STAR ZGZR 40600

1.5 5 HITACHI ICLEAN RAU517ISD 41648

1.5 5 HITACHI ACE FOLOWME RAU518ESD 41690

1.5 5 LG LSA5SP5Z 41700

1.5 5 GODREJ GSC18FG7BLG 44990

TONNAGE STAR RATING COMPANY MODEL PRICE

2 1 SAMSUNG MAX AS241UBJ 32900

2 1 HITACHI KAMPA RAU010KQDD 35090

2 1 HITACHI KAZE RAU121KSD 38656

2 2 HAIER HSU24LA2 25500

2 2 SAMSUNG PURISTA AS242BBJ 35400

2 2 LG LSA6UR2A 36100

2 2 LG LSA6MR2T 36200

2 2 BLUESTAR 2STAR TR 37000

2 2 BLUESTAR 2STARO 2HW240A 37699

2 2 LG LSA6AR2T 38500

2 2 SAMSUNG MAX AS242UGF 38600

2 3 KORYO KSI24AO3S 29990

2 3 LLOYD FLS24A3C 26600

2 3 ELECTROLUX EGS63 32490

2 3 PANASONIC CS/CU-YC24NKY 35490

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2 3 ELECTROLUX SB63 35490

2 3 GODREJ GSC24FR2WLT 38690

2 3 GODREJ GSC24FR3WIT 39690

2 3 LG LSA6AR3T 40000

2 3 BLUESTAR 3START HW24TB 42200

2 3 LG LSA6SP3Z 43000

2 3 BLUESTAR 3STARV 3HW24SVB 43300

2 3 LG LSA6EW3Z 44000

2 3 HITACHI ACE RAU324HSD 46898

2 3 HITACHI ACE FOLOWME RAU324ESD 48240

2 3 HITACHI ICLEAN RAU321ISD 48473

2 3 VIDEOCON VITA MAX VBS63.WV1 55990

2 4 WHIRLPOOL CHROME 4 36500

2 4 ONIDA S24FLT-N3 38090

2 5 VOLTAS PLATINUM 4S-5S 40486

2 5 PANASONIC TC24NKY 43490

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PRICING :

PRICE RANGE

1.5TR,2STAR-18500-31200

1.5TR,3STAR=17900-37900

1.5TR,4STAR=20300-37200

1.5TR,5STAR=26000-44990

PRICE RANGE

2TR,1STAR=32900-38656

2TR,2STAR=25500-38600

2TR,3STAR=29990-55990

2TR,4STAR=36500-38090

2TR,STAR=40486-43490

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BEST PRICING COMPANY

1.5TR,2STAR=HAIER

1.5TR,3STAR=LLOYD

1.5TR,4STAR=LLOYD

1.5TR,5STAR=LLOYD

BEST PRICING BRAND

2TR,ISTAR-SAMSUNG

2TR,2STAR-HAIER

2TR,3STAR-KORYO

2TR,4STAR-WHIRLPOOL

2TR,5STAR-VOLTAS

COLLABORATERS AND PARTNERS CAPABILITIES:

What Tecumseh looks for??

Tecumseh envisages its suppliers as a part of its family and a very valuable resource in its supply chain.

As a supplier companies are required to be

Quality Focused: Quality levels of 100 PPM should be the goal that every supplier should strive to achieve. Quantum reduction in the rejection levels year on year.

Competitiveness: In the dynamic changing business scenario, you are expected to reduce / contain cost by lean manufacturing practices, improving internal efficiencies and productivity in the manner that meets the customer requirements.

Flexibility: Should be able to meet our requirements of varying demands / minimal lead-time for new product developments / shorter lot sizes for deliveries (Just in time).

Raw materials required (compressor manufacturing):-

Steel Brass Copper Aluminum Alloys Plastics

Components required (compressor manufacturing):-

Casting Sintered Forged parts Press parts Machined parts Injection molded plastic parts Extruded molded parts rubber parts Sealing elements Spring-mounting Electromechanical parts

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AIR CONDITIONER UNIT

IN-DOOR UNIT

OUT-DOOR UNIT

Packaging components (compressor manufacture):

For shopping Bulk pack Wooden pallets Individual product packing box

Air conditioner manufacturing:-

INDOOR UNIT:-

The factors which considered for selecting an indoor unit are.

Quality Price

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The factors that lie under ‘quality’ are.

Remote control application Noise level Cooling capacity

Presently Tecumseh intakes the indoor unit from GALANZ, CHINA. This is one of the leading producers of Air Conditioners in CHINA.

GALANZ, CHINA:-

Galanz Group is a world-class enterprise with the target of building “a centennial enterprise and global brand” and has globally leading R&D centers of microwave oven, air conditioners and household appliances in Shunde and Zhongshan, Guangdong. It has 13 subsidiaries in headquarter, 52 sales offices across the country and branches in H.K, Seoul and North America.

Galanz entered into air conditioner industry since 2001 while realizing steady upgrading of microwave industry. As the pioneer in deluxe stainless steel air conditioners, Galanz found its name among strongly competitive brands in the first year when Galanz set its food into the air conditioner and refrigerator industry. In 2004, Galanz invented light wave air conditioner, which became popular immediately. The export volume ranked among leading ones in the world and helped Galanz to become a major producer of air conditioners in the world. In 2005, “globally largest professional air conditioner R&D base” was established in Galanz. This super-scale (3000mu) air conditioner R&D base engages in collective development and production of light wave air conditioners.

Features provided by GALLANZ:-

Turbo cooling LED display Timer mode Dry mode

Add-on features by TECUMSEH:-

Super silent operation

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Soft-start technology Effective cooling at 54°C Aesthetic design Energy efficiency

OUT DOOR UNIT:-

Outdoor unit of AC consists of components like.

Sheet metal Fan motor Fan blade Compressor Copper tube

According to sources from the company, there are very few producers of the components of out-door unit in India and globally. The vendors of different components are given below.

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Sheet metal- TCL. GALANZ Fan motor-MARATHON, MICRO INSTRUMENT Fan blade- PALAM PLASTICS Copper tube- QUALITY TUBES LTD.

Some of the concepts considered while ordering outdoor units are.

The requirements and ordering of components by the company is mainly dependant on the customer requirements and the specifications given by the customers

As there are very few producers of the components, there is not much product differentiation observed in terms of quality and specifications of the product.

LEGAL POLICIES OF GOVERNMENT:

Air conditioner tonnage:-

The air-conditioner tonnage determines a unit's cooling capacity. Figuring out the tonnage will help you understand the unit size you'll need for your home. And although many factors will influence the size unit you'll choose, the following steps will aid in that assessment. It's easy to figure out the air-conditioner tonnage and what it means.

Calculating air conditioner tonnage:-

When calculating air conditioner tonnage, we should understand that 1 ton is equal to 12000 BTU or British Thermal Units. To determine what size air conditioner you need, we need to know the area that you want to cool, what temperature you want to keep the area at, and the maximum outdoor temperatures. If we are replacing an air conditioner that has worked well, you can simply go with the same capacity unit again.

Tonnage is one way to measure the capacity of an air conditioner, with each ton representing the amount of heat needed to melt one ton of ice. More common are British thermal units, or Btu, with each Btu equal to the amount of energy needed to raise one pound of water one degree Fahrenheit. To calculate the tonnage you need, you will need to know the size of your home in square feet, whether any rooms receive extra sun or minimal sun and how your rooms will be used.

Steps to calculate tonnage:-

1. Approximate the total Btu needed for your home by using a sizing chart that estimates the capacity based on the square footage of your home.

2. Modify your approximation for any particularly sunny rooms by adding 10 percent to that room's capacity. Use the room sizing chart from the U.S. Environmental Protection Agency to determine how much that room requires. Then multiply this number by 0.1 to determine how much to add.

3. Subtract 1,000 Btu for each room that is shaded or otherwise gets minimal sun.4. Add 4,000 Btu for every kitchen. The requirements are higher for kitchens because of the

extra heat generated in them.

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5. Add 600 Btu per person above the second that will live in each bedroom. This does not refer to people who will use a room such as a living room. For example, if five people will share a room, you would add 1,800 Btu.

6. Total steps 1 through 5. This is the total Btu capacity your air conditioner must have. Divide this by 12,000 to find the tonnage your unit needs; there are 12,000 Btu per ton. For example, if the total was 30,000 Btu, you would need an air conditioner with a capacity of 2.5 tons.

BEE norms:

This Standard specifies the energy labeling requirements for single-phase split air conditioners of the vapour compression type for household/ commercial use up to a rated cooling capacity of 11 kW and that fall within the scope of IS1391 Part 2, being manufactured, imported, or sold in India including different type of Air conditioners up to 3 ton capacity.

Parameters to be tested

1. Energy ConsumptionThe Energy Consumption test of the air conditioner shall be conducted as per IS 1391 Part 2 with

all amendments.

2. Cooling CapacityThe Capacity Rating test of the air conditioner shall be conducted as per IS 1391 Part 2 with all

amendments.

Note : All standard ratings for equipment in which the condenser and the evaporator are two separate assemblies shall be determined with the maximum length of refrigerant tubing on each line of length specified by the manufacturer or 7.5m, whichever is shorter. Such equipment in which the interconnecting tubing is furnished as an integral part of the unit and not recommended for cutting to length should be tested with the complete length of the tubing furnished. Unless constrained by the design, at least half of the interconnecting tubing shall be exposed to the outdoor conditions. The line diameters, insulation, details of insulation, evacuation and charging shall be in accordance with the manufacturer's published recommendations.

Definitions:

1.1. Star Rating

The number of stars displayed on the energy label. The available stars are between a minimum of one and a maximum of five shown in one star interval. The star rating is calculated from the Star Rating Band (refer 2.2 of this Annexure)

1.2. Star Rating Band

The Star Rating Band is a range of energy efficiency ratio (W/W) which is arrived by calculations (refer 2.2 of this annexure), and is used for determining the number of stars displayed on the energy label.

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EER (W/W)Star Rating Min Max

1 Star * 2.30 2.492 Star ** 2.50 2.693 Star *** 2.70 2.894 Star **** 2.90 3.095 Star ***** 3.10

1.3. Family of models

Family of models is the range of models of one particular brand, to which a single set of test reports is applicable and where each of the models has the same relevant physical characteristics, comparative energy consumption, and energy efficiency rating and performance characteristics. The term ‘model’ is synonymous with ‘family of models’.

1.4. Variant

A model variant is an alternative version of a model which has the same sales specification and the same model number or other form of designation as another version of the model, and offers the same performance except that it has a different PAEC and may have a different Star Rating.

CALCULATIONS FOR THE ENERGY LABEL

2.1 NUMBER OF TEST AND PROCESSING OF DATA

2.1.1 Number of units required

For the purpose of determining the Energy Efficiency Ratio (EER) of a model for labeling, two separate units of the nominated model shall be tested for capacity and energy consumption

2.1.2 Number of tests per unit

Each unit shall be tested with sufficient test runs to enable a valid EER to be determined for that unit. This determination shall be documented in a test report containing the test result for all test runs used to derive EER.

2.1.3 Rounding

Unless otherwise stated, number shall be rounded and recorded to five significant figures. The values of Capacity (kW) shall be rounded and recorded to three significant figures.

The values of Energy Consumption (W) shall be rounded of (< 0.5 to lower whole number and ≥ 0.5 to higher whole number) to the nearest whole number.

The values of EER (W/W) shall be rounded and recorded to two significant figures.

2.2 STAR RATING

The star rating parameters EER shall be obtained from TABLE 2.1 / 2.2 / 2.3, depending on the year of manufacturing/import/assembling

TABLE 2.1: Star Rating Band valid from 01 May 2011 to 31 December 2011.*

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TABLE 2.2: Star Rating Band valid from 01 January 2012 to 31 December 2013.*

TABLE 2.3: Star Rating Band valid from 01 January 2014 to 31 December 2015.*

LABEL DESIGN AND MANNER OF DISPLAY

PLACEMENT

All air conditioners must display the label at the point of sale. The label shall be adhered, or attached as a swing tag, on the front of the unit or display front.

For units not on display, the label may be attached to the exterior of the packaging. The label may be attached to the unit when the unit is removed from its packaging or the label may be included as a part of the documentation given to the customer/user.

MATERIAL AND SHAPE

The label shall be of durable cardboard, if it is to be attached as a swing tag, or be self adhesive and shall be cut to one of the outlines shown in Figures Figure 3.1 as applicable

COLOURS

The label shall be printed as per the specification given in Figure 3.2

SAMPLE LABEL

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An example of a printed energy label for air conditioner is shown in Figure 3.3. The label will mention the following:

1. Appliance/Type

2. Brand/Model Name/Number/Year of Manufacturing

3. Capacity (kW) (Actual Tested)

4. Power (Watts)

5. EER (W/W)

6. Variable Output Compressor (Yes/No)

7. Heat Pump (Yes/No)

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Figure 3.1: Design Scheme for the Label (Sample).

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Figure 3.2: Color Scheme for the Label (Sample).

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Figure 3.3: Sample Label

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COMPANY STRENGTHS:-

75 years of experience in air conditioning industry. Manufactures wide range of compressors for air conditioners and refrigeration. “BEE certified lab” which tests the performance of all the other brands of air conditioners thus

helping the company to know about what’s going in the market.WEAKNESS:-

No experience in consumer marketing. Being a new entrant for air conditioners in the market, the company needs to improve in proper

dealer and service channels.

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FINDINGS

LG:-

Standing as the leader in its sales of ACs occupying the major portion of the market share. LG is attracting almost every section of the consumer because of wide range of products and

features.

PRODUCTS AND PRICES:-

FEATURES NO. OF PRODUCTS PRICE RANGE

1.5 Tr, 2 STAR 1 29000

1.5 Tr, 3 STAR 5 28700-37200

1.5 Tr, 4 STAR 0 -

1.5 Tr, 5 STAR 7 35000-41700

2.0Tr, 2 STAR 3 36100-38500

2.0Tr, 3 STAR 3 40000-44000

2.0Tr, 4 STAR 0 -

2.0Tr, 5 STAR 0 -

PLACE:-

Available at

Authorized outlets Multi brand showrooms

PROMOTION:-

According to the dealer’s opinion, LG is providing the best service in the market. Even the sales persons are recommending the customers to go with LG due to its best in class

service. Every business centre has an LG authorized outlet with seasonal offers.

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SAMSUNG:

Attracting the customers with its innovative promotional activities. Every business centre has an SAMSUNG authorized outlet within the customers reach.



1.5 Tr, 2 STAR 4 25700-31200

1.5 Tr, 3 STAR 5 31200-37900

1.5 Tr, 4 STAR 3 34400-37200

1.5 Tr, 5 STAR 2 34900-36600

2.0Tr, 1 STAR 1 32900

2.0Tr, 2 STAR 2 35400-38600

2.0Tr, 3 STAR - -

2.0Tr, 4 STAR - -

2.0Tr, 5 STAR - -

PLACE:-

Available at

Authorized outlets Multi brand showrooms Small and medium scale outlets

PROMOTION:-

Even small-scale showrooms are displaying SAMSUNG ACs leaving the tough competitors like LG,VOLTAS etc

Every consumer electronics showroom is displaying with at least 3 latest variants of SAMSUNG ACs.

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VOLTAS:-

Providing tough competition to LG,BLUE STAR by retaining its brand name ‘TATA’ It is focusing more on single variant (1.5 TR, 5 star).



1.5 Tr, 2 STAR 1 28650

1.5 Tr, 3 STAR 2 29930-33690

1.5 Tr, 4 STAR 0 -

1.5 Tr, 5 STAR 2 35260-35936

2.0Tr, 2 STAR - -

2.0Tr, 3 STAR - -

2.0Tr, 4 STAR - -

2.0Tr, 5 STAR 1 40486

PLACE:-

Available at


PROMOTION:-

Lagging behind in the promotional activities with the intention that its brand name will promote its sales in the market

Every consumer electronics showroom displaying only 1 or 2 ACs which are released newly in the market

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BLUE STAR

It’s with a unique feature of 38% more power saving. It is the costliest brand available in the market. Its price is high due to its advanced technology called ‘I-FEEL’ which seems to be the latest

technology in the market



1.5 Tr, 2 STAR 1 30139

1.5 Tr, 3 STAR 2 33500-36000

1.5 Tr, 4 STAR 0 -

1.5 Tr, 5 STAR 3 39500-40600

2.0Tr, 2 STAR 2 37000-37699

2.0Tr, 3 STAR 2 42200-43300

2.0Tr, 4 STAR - -

2.0Tr, 5 STAR - -

PLACE:-

Available at


PROMOTION:-

It is preferred by only few sections of customers. It is mainly depending on the electronic media for its promotional activities, Specialized in providing ACs with high capacity i.e., higher tonnage.

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VIDEOCON:-

Very old brand and well known brand in the market is its strength. It is not able meet the expectations of the customers and has scored very low rate in consumer

satisfaction according to recent surveys. Not able to compete with the recent trends in technology those other competitors are coming up

with.



1.5 Tr, 2 STAR - -

1.5 Tr, 3 STAR 1 25990

1.5 Tr, 4 STAR 0 -

1.5 Tr, 5 STAR 2 27490-28990

2.0Tr, 2 STAR - -

2.0Tr, 3 STAR 1 55990

2.0Tr, 4 STAR - -

2.0Tr, 5 STAR - -

PLACE:-

Available at


PROMOTION:

Its main strength is its highest number of service centers in metro cities

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PANASONIC:-

The only brand in the market which is providing tough competition to Samsung in promotional activities is PANASONIC.

Market share is increasing for Panasonic only due to its promotional activities.



1.5 Tr, 2 STAR 0

1.5 Tr, 3 STAR 1 30490

1.5 Tr, 4 STAR 0

1.5 Tr, 5 STAR 1 36990

2.0Tr, 2 STAR 0

2.0Tr, 3 STAR 1 35490

2.0Tr, 4 STAR 0

2.0Tr, 5 STAR 1 43490

PLACE:-

Available at

Authorized outlets Multi brand showrooms Small and medium scale outlets

PROMOTION:-

It is mainly concentrating on occupying huge POP in every showroom.

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HITACHI:-

Hitachi offer split air conditioners in almost every range of budget they can for consumers. It is available in all the multi brand showrooms. It is not visible much in the business centers although some of the small scale dealers are selling

it. It is lagging in providing with proper service.



1.5 Tr, 2 STAR 1 18500

1.5 Tr, 3 STAR 1 21500

1.5 Tr, 4 STAR 0 0

1.5 Tr, 5 STAR 1 29695

2.0Tr, 2 STAR 1 25500

2.0Tr, 1 STAR 2 35090-38656

2.0Tr, 4 STAR 0 0

2.0Tr, 5 STAR 0 0

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HAIER, ELECTROLUX, GODREJ, WHIRLPOOL, ONIDA:-

They are not able to with stand with the competition in the market because of its poor ‘marketing mix’.

Not even single variant is available in the business centre which we have surveyed. WHIRLPOOL is available in some of the multibrand showrooms but because of its poor service

facility consumers do not prefer it. ELECTROLUX & GODREJ have not introduced any new models for the current year and there

is nothing called the running model for these brands.HAIER is very poor in its marketing strategies which resulted in finding no place for its products in the market



1.5 Tr, 2 STAR 4 18500-28000

1.5 Tr, 3 STAR 11 21500-33500

1.5 Tr, 4 STAR 7 28890-33440

1.5 Tr, 5 STAR 9 29695-44500

2.0Tr, 2 STAR 0 0

2.0Tr, 3 STAR 1 25500

2.0Tr, 4 STAR 4 32490-39690

2.0Tr, 5 STAR 0 0

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KORYO:

Koryo is the subsidiary of the future group and it is available only in the authorized retail outlets of future group like BIG BAZAR & FUTURE BAZAR.



1.5 Tr, 2 STAR 1 22990

1.5 Tr, 3 STAR 1 24990

1.5 Tr, 4 STAR - -

1.5 Tr, 5 STAR 2 27990-30990

2.0Tr, 2 STAR 0 0

2.0Tr, 3 STAR 1 29900

2.0Tr, 4 STAR 0 0

2.0Tr, 5 STAR 0 0

PLACE:

BIGBAZAR

FUTUREBAZAR

PROMOTION:-

Occupying a new POP away from all other competitors and attracting customers with its innovative POP.

It has entered the market with very low prices in all the variants.

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LLOYD:-

Being a new entrant in the market it is offering tough competition to the established brands due to its low pricing strategy and high dealer margins.

Due to its low price, it is preferred by economic class of customers.



1.5 Tr, 2 STAR - -

1.5 Tr, 3 STAR 1 18900

1.5 Tr, 4 STAR 1 20300

1.5 Tr, 5 STAR 1 26000

2.0Tr, 2 STAR 0 0

2.0Tr, 3 STAR 1 26600

2.0Tr, 4 STAR 0 0

2.0Tr, 5 STAR 0 0

PLACE:-

Available at

Multi brand showrooms Small and medium scale outlets

PROMOTION:-

Highly concentrating in its promotional activities as every electronics showroom is displaying LLOYD danglers in their interiors and attractive display boards outside the showroom.

Due to its low price, recently SBI has booked for 4000 LLOYD ACS only in A.P.

Marketing strategy:-

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As Tecumseh is a new entrant in the consumer marketing, it should penetrate into the market with innovative strategies by utilizing the consumer feedback and also the competitor strategies prevailing in the market.

We have gone through the market and gathered required information from the consumers, dealers and competitors.

We have designed our strategy in terms of four aspects i.e., product, price, promotion, place.

Product:-

When a new product is entering the market, every marketer should design the product from consumer’s point of view.

We have confined our project to urban customers, in our observations we found that customers largely are influenced by the following factors,

Aesthetics of the product Features of the product Price of the product

Aesthetics of the product:

The outlook of the product is very crucial element because it is the only way to grab the customer from all the available competitors and make the seller to demonstrate about the product as he is attracted towards the product’s outlook.

Tecumseh AC:-

The air conditioner which Tecumseh is going to market is milky white in color with a simple floral stickering on its IDU.

Competitor’s AC:-

The air conditioners available in the market are much more advanced in their outlook with metallic finishing’s, four to five color ranges and attractive stickerings.

For example, AC which whirlpool is marketing has a sliding front panel with metallic and not metallic finishes which is attracting the customers.

What we suggest:-

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Tecumseh should concentrate on developing the outlook of the product by adding some more color ranges, metallic or stainless steel finishes and 3D stickering to the product which can attract the customers.

Features:-

The other important factor which the consumer looks for is the features of the product. In order penetrate in to the market and acquire considerable market share we need to be innovative in providing the features to our product.

Tecumseh AC:-

Tecumseh is providing with the following basic features

Soft start technology Super silent operation Turbo cooling etc...

Competitor’s AC:-

Competitor’s have their own USPs to make them different from the other available products in the market like

Panasonic has the ECO-NIVA technology which senses the sunlight and human movement and accordingly changes its cooling capacity.

LLOYD has given the cooling & heating options, 2way oscillating vents and higher energy efficient features at very low prices in the market.

LG is providing with the anti bacteria filter, allergy safe filter, 30ft air and other energy saver options.

What we suggest:-

To know what the customer actually needs as the features of an AC we have gone for a market survey and asked the customers for their opinion.

We have given the following options to customers and requested their choice if features. Oscillating vents Sleep mode Ventilation/exhaust Automatic temperature control Energy saver switch Check filter light

Many of the customers have opted for the two features automatic temperature control & energy saver switch.

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We don’t have these two features in our USPs so we request the R&D team to look after the two features.

Important note:-

The IDU which we are importing is providing us with very basic features like lcd display, turbo cool, sleep mode etc. when we tracked the profile of gallanz we could spot the other models of gallanz are constrained with the two features of automatic temperature control and energy saver switch. Therefore, it would be preferable for us to opt for those IDUs as the customers are requesting for those two options.

We have very low star ratings for our products but in our market survey we have observed that consumers prefer only 3 and 5star rated products. So we request to work on the improvement of star rating of our products.

The refrigerant R-22 which we are using for our AC is proved to be ozone depletion potential and the competitors like LG and Panasonic are using R410A as the refrigerant and proving themselves to be environmental friendly. So we request the top-level management and the R&D team to work on this aspect.

Price:-

We believe that price is the very crucial factor that matters when we are launching our product in to the market. Pricing of the product has to be done based on three factors.

Manufacturing cost of the product. Consumer affordable Competitive in the market.

Manufacturing cost of the product:-***

As we were not provided with the cost per unit of the product we could not work on this particular aspect.

Consumer affordable and competitive price:-

The price of our product should be affordable to all the economical sections of the consumers and it should be competitive in the market.

We have segregated the models based on their tonnage and star rating and asked the consumers for their expected price levels for each model.

1.5 Tr **:-

Price ranges in the market = 18500-31200/-

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Consumer analysis: - no customer is ready to opt for 2star rated product.

1.5Tr ***:-

Price ranges in the market = 17900-37900

Consumer analysis: consumers are preferring the price anything less than Rs25000/-

Competitor analysis: - Lloyd, Haier, Electrolux, koryo models are priced below 25000/-.

1.5 ****, *****:-


Consumer analysis: most of the customers are preferring prices less than 25000 and 25000-35000. So in order to satisfy both the sections we can price our product between 23000/- -28000/-.

Competitor analysis: Lloyd, Onida, VIDEOCON, KORYO have their models priced between 23000-28000.

2tonne *:-


Consumer analysis: - most of the customers prefer prices 25000-35000 & greater than 35000. So in order to satisfy both the sections we can price our product between 32000-36000

Competitor analysis:-Samsung and Hitachi have their models priced between 32000 and 36000.

Promotional activities:-

While promoting product as a new entrant in to the market we need to attract two people in the market they are,

1. Dealer2. customer

Dealer promotional activities:-

In our personal interaction with the dealers we got to know that companies are offering about 10-15% as dealer margin per unit sales of the product. We as a new entrant should offer him anything more than the above numerical to attract the dealer and sell our products in the market.

Offering the dealer with a free AC can motivate him to promote our product and also this may help the customer to perceive that our product is the best available in the market as the dealer himself is using the product.

Providing incentives to the dealers for their best sales during the busy seasons.Customer promotional activities:-

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Different companies in the market are attracting the customers with their innovative promotional schemes some of which are mentioned below

SAMSUNG: - Samsung is attracting good number of customers with its ‘GIFT CARD’ scheme by which if we scratch the card the customer can avail a cash back offer which is deducted from the price of the product.

LG :- LG is attracting customers with their promotional activity which offers discount on other electronic products of LG if they buy AC this discount offer is valid till 1 year from the date of purchase.

LLOYD: - LLOYD has other form strategy, it has appointed Karanjohar as its brand ambassador, its low prices are other form promoting the product and high dealer margin is also helping in promoting the product.

PANASONIC: - Panasonic has appointed Bollywood actress Katrina kaif as its brand ambassador, some other promotional activities 5year warranty, R410A (environmental friendly), ECO-NIVA technology practical demonstration.

WHIRLPOOL: - whirlpool is offering a free Reebok trolley bag with every single purchase of AC.

What we suggest:-

As a new entrant we need to be very innovative in our promotional activities some of the promotional activities suggested are given below.

Offering any attractive and useful product as free for every single purchase of the product. Announcing cash back offers to the customers.

Place:-

Place of purchase is very important factor because it is the only aspect through our product reaches the consumer. Being innovative and different while selecting such places can boost the flow of products. We have also considered the cost of placing the product while selecting the place of purchase.

We have asked the consumers in our market survey for their opinion in the place of purchase of ACs.

Majority of the customers have opted for authorized outlets and multi branded showrooms as their preferred place leaving the business centers and online shopping.

What we suggest:-

we should take proper measures such that our authorized outlets will be placed in business centers such that it would cover the two places of purchase i.e., authorized outlet and business centre which seems the less cost effective for new entrants like us.

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Measures should be taken such the highest number of models displayed in multi-branded showrooms belongs to Tecumseh which helps in dominating the vision of the other products in that section.

Kiosks should be maintained at the business centers and multi-branded showroom premises during busy seasons which help in boosting the sales. For ex, summer is considered to be the busy season for ACs if we run kiosks during summer then they definitely help in communicating our product to the customers.

Place of purchase (inside the showrooms):-

Place of purchase is very important factor to be considered which attracts the vision of the customer inside the multi branded showrooms.

Decorating the place of purchase and displaying Tecumseh ACs in separate stands would grab the customer to the place of purchase.

Appointing promoters in reputed multibrand showrooms or offering incentives to the salespersons in showrooms could help in boosting the sales.

Danglers, advertisement holdings, attractive brochures could also help in communicating the new entrant to the customers.

Online shopping:-

Online shopping is the emerging retail sector in India which is matching the requirements of the busy and urban customers. It helps in knowing the product themselves and selecting their choice of product and also getting rid of the outward disturbances in the show rooms.

It helps the new entrants like Tecumseh in reducing the cost factors that are incurred in maintaining the dealer network and thus reducing the marketing cost.

What we suggest

Being innovative in displaying our product is the very crucial aspect in online shopping. For this we suggest our IT department to make an attractive video covering all the features and USPs of our product and the company to. So we need to upload the video file in the space that the online shopping franchises provide which is innovative in communicating our product.

Service centers:-

Tecumseh went in collaboration with a third party service network provider. Many of the leading air conditioner companies have gone for this option as it is price cutting and used to provide best service. So it is good move by a new entrant to establish a wide area network which covers the entire country. This process has to be reviewed regularly to ensure that best service is provided to the customer.

Annexure

QUESTIONNAIRE (individuals)

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1) Name of the customer:

2) Designation:

3) Monthly income

(i) Less than 20000 (ii) 20000-30000

(iii) 30000-50000 (iv) greater than 50000

4) Preferred price ranges of AC’s

(i) Less than 25000 (ii) 25000-35000 (iii) greater than 35000

5) Capacity preferred

(i) 1 ton (ii) 1.5 ton (iii) 2 ton

6) Preferred star rating

(i) 3 star (ii) 4 star (iii) 5 star

7) Features preferred

(i) Oscillating vents

(ii) Sleep mode

(iii) Ventilation/exhaust

(iv) Automatic temperature control

(v) Energy saver switch

(vi) Check filter light

8) Do you prefer power consumption level when compared to cooling capacity?

(i) Yes (ii) No

9) Do you prefer brand while buying an AC ?

(i) Yes (ii) No

10) Which brand comes into your mind when you think of AC?

_____________________

11) Do you get attracted towards new brands with more features and durability

than the existing brands? (i) Yes (ii) No

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Final Report

Documents

Transcript of Final Report