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INTRODUCTION

s we know, modern life is changing rapidly and only change is imminent

and unavoidable in this universe; and this human kind in the changed form of a

consumer is not a king now but he has become an emperor. Now a day,

marketing is the core concept of any organization and this marketing activity

turns around the consumer. So present era can be termed as era of

consumerism.

Said Charles dickens of French Revolution in A Tale of Two Cities, written 100

years ago: It was the best of time; It was the worst of time. Today there are many

blessings: extremely high productivity because of mechanization and automation,

the promise of computer and internet, the rapid growth of global trade, and the

end of the cold war. Human kind today has capacity to end the hunger in the

world and to cure many epidemic diseases.

Here in its full capacity the industrial innovators have done many more

innovations to satisfy the needs of the target segment and to meet their lifestyle

necessities and washing machine is one of those innovations. Now, life is quite

busy, daily household works need some convenience, and washing machine

provides this facility.

Washing machine as a consumer durable item was considered to be luxurious

home appliance in India 10 or 15 years ago; but after the invent of new

economic policy ,the scenario has been improved by many folds. Now it has

become a necessary goods in nuclear or service class family and the same thing

is happening in middle-class income group of India, which is now 300 million in

number, approximately equal to the population of U.S.A . So there is a great

scope for this item in the changing way of consumer behaviour in India and

realizing this fact MIRC ELECTRONICS LTD.; a premier player in colour and

black & white television has jumped into the market of washing machine.

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But we have already said that the scenario is quite different now and there is a

tough competition in this segment. Washing machine sales volume in India has

crossed 1 million mark 1 year ago but it is also a point to be noted there are so

many established companies engaged in this market. Therefore, it has to

compete with them. For this purpose, company is taking many efforts as the part

of their marketing strategy to promote its product.

Selecting Mumbai as one of the business cities, MIRC ELECTRONICS LTD.

started awareness creation by doing various activities. Sales promotion consists

of a diverse collection of incentive tools, mostly short –term design to stimulate

quicker or greater purchase of particular product by consumer or the trade. Sales

promotion includes tools for consumer attraction e.g. Free coupons, cash refund

offers, discount, premiums, prizes, patronage reward, free-trial, point of purchase

display and live demonstration. Here company is looking Mumbai as a great

prospect because of capital city of to be proposed state of Vidarbha and as a

leader in TV segment in this region.

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OBJECTIVE OF THE STUDY

he importance of this study in today’s marketing scenario is obvious;

when the visible opportunity for the market is very less due to tough competition.

The 4 P’s given by the Marketing Guru Philip Kotler are not sufficient to remain

competitive in the market. Besides those 4 P’s one company must also bank on

two mare P’s and these are Pre-empt (to do something before your competitors

do) competition and Pace. In today’s scenario, being a big fish is not enough but

being a bigger fish with faster speed is required to sustain. Here Mirc Electronics

is taking some extraordinary efforts to become a bigger fish in washing machine

market in Siliguri city. Here our aim is to study those efforts or strategy as termed

in marketing field of the company. The points of the study are-

Strategy of the company for promotional activity

Company’s pricing policy

Company’s customer relationship management

Awareness level of the product

Impact of company’s policy on distributor/dealers

Criteria seen by the dealers and customer for taking particular dealership

and the product respectively

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MIRC ELECTRONICS LTD :COMPANY

PROFILEPAST OF THE COMPANY

he company was establishment in 1981 as a private limited company

called MIRC Electronic Limited in Mumbai. Before that it was working under the

name of Monica Electronics having its main office in Delhi. It became the pioneer

of electronics watches India 1977. In 1982, India’s first Video Cassette is

manufacture by MIRC Electronics Ltd.

India’s first monitor television was launched under the brand name “ONIDA” and

Onida became the authorized service center of JVC in India in 1983. In 1985

research & development department is established at Onida. In 1987, they have

launched the stereo system & one separate international marketing division was

established in 1988. After that the continuous launching of the new product was

done until 1988. In 1989 they launched VCR’s , in 1990 Air-conditioners & Black

& White Televisions were launched , in 1991 they launched the training school

for service technicians also launched the VCR with auto head cleaner. In 1991,

MIRC Electronic Ltd. has launched the fully automatic machines and in 1992,

they launched semi automatic washing machines. In 1995 they got the

commencement of Wada plant, which was one of the best in Asia with all the

sophisticated machinery; also they got the ISO Certification. From 1996 they

started launching different range of TV’s like 2100 series, KY series, Unique

collection and 21” IQ CTV.

COMPANY MILESTONE-

1981 : MIRC Electronics Pvt. Ltd. was established

1982 : CTV production started at Nand Bhavan, Mumbai

1983 : Technical collaboration with JVC, Japan for CTV

1985 : Established in-house R&D wing

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1986 : Production expanded and moved to a new factory at Kalina

1987 : Moved to own factory building "ONIDA HOUSE" 

Iwai, Speaker plant commences its operation

1990 : Tuner plant commences operation

1991 : Akasaka, PCB plant commences its operation

New CTV manufacturing plant at Vasai commences operations

1992 : Crossed 1 million CTV sales

1994 : Moved to a fully automated Plant of 600K CTV per year at Wada

1994 : Moved to a fully automated Plant of 600K CTV per year at Wada

1995 : ISO 9001 certification obtained from BVQI

1998 : Award for excellence in electronics by ministry of IT

1999 : First in India to develop Internet enabled CTV

2000 : Launched the KY Thunder, Profile Series

2001 : AV Max award for best CTV 

Launched Onida Black, flat CTV range 

Multimedia projectors launched 

Commenced project to expand CTV capacity to 1 million

2002 : Completed plant expansion project to increase capacity from 600K CTVs

to to 1.2 million CTV's per year. 

Launched 'KY Theatre' with circle surround sound, the first complete

IHome Theatre package

Launch of 'Igo'- the economy brand 

Launched VCD player

2003 : Launched world's first LCD remote 'i-Control' 

Launched Air-conditioners

Launched Rear Projection TV, Plasma TV & DVD Players 

Launched Fully Automatic front loading Washing Machines 

A MIRC product is getting sold every 27 seconds 

Operations started in Russia

2004 : Launch of the 'Oxygen Series' CTV 

Crossed Sale of 250,000 CTV's in October month

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Launch of Microwave Owens

Mr.Gulu Mirchandani, CMD awarded 'Man of Electronics for the year' by

CETMA

2004- 05 : Achieved 1.20 million CTV sales

2005 : Launch of 'POISON' range of CTV's

2009 : ONIDA's Brand relaunch campaign 'Tumko Dekha Toh Yeh Design Aaya'

to communicate its philosophy of thoughtful product features that are designed

keeping customers in mind.

COMPANY PRODUCT RANGE

At present, the company offers different models of semi automatic and fully

automatic Washing machines. These different ranges of models are-

SEMI AUTOMATIC WASHING MACHINES-

ONIDA HYDROSHAKTI 3.5 KG

ONIDA HYDROSHAKTI 5.5 KG

ONIDA ECOWASH 5.5 KG

ONIDA HYDROSHAKTI 6 KG

ONIDA HYDROSHAKTI 6.5 KG ( METAL BODY)

ONIDA HYDROSHAKTI 6.5 KG (FULLY PLASTIC BODY)

FULLY AUTOMATIC

SFL60 6KG

WASHING SYSTEM (without dryer)

LILIPUT 6.5 KG

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Company Performance in the last few

years

Period 2003 2004 2005 2006

No of months 12 12 12 12

Sales Value(Rs mn)

Audio Systems 31.4 15.3 4.1 1.1

Television 5029.4 6515.9 7506.9 6743.8

Music player 52.8 20.9 8.5 1.7

Washing Machines 1.1 29.6 132.1 98.9

Others 111 304.1 321.1 306.6

Sales Volume(Units)

Audio Systems(Nos) 27553 11323 7947 766

Telivision(Nos) 799888 1068609 1191757 970607

Music player(Nos) 8263 1785 1024 246

Washing Machines(Nos) 497 4204 18846 14782

Unit realisation(Rs per unit)

Audio Systems(Nos) 1139 1354 516 1405

Telivision(Nos) 6288 6098 6298 6948

Music player(Nos) 6394 11687 8322 6955

Washing Machines(Nos) 2284 7035 7011 6689

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QUALITY OBJECTIVE OF THE

COMPANY

he general objective of the organization is to achieve and sustain quality

at competitive price in the domestic and export market.

The product shall be designed and developed to meet the customers’ quality

requirements including safety and reliability.

Material supply and delivery shall be in line with stated specification with

continuous efforts to improve cost of procurement and reduce inventory level.

There shall be strict adherence to specifications and during manufacturing and

inspection with emphasis on statistical defect analysis and prevention in order to

continuously improve operational in the order of cost of manufacturing, quality

and capacity utilization.

The sales distribution network and logistics shall be organized such that there is

easy and timely availability of the products to the customer while reducing

working capital deployment in finished goods inventory and debtor.

There shall be constant endeavor to increase customer satisfaction by reducing

field failure rate, continuously and by providing timely and efficient after sales

service.

Feedback continuously obtained from customers, both internal and external, shall

be used.

Employee shall be deployed with right competence while shall be continuously

upgraded with training programmes.

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PRODUCT PROFILE

irc Electronics Ltd. Has introduced washing machine with the latest

feature and technologies at a cheaper price. The washing machine manufactured

is broadly classified as-

SEMI - AUTOMATIC

FULLY - AUTOMATIC

SEMI-AUTOMATIC MACHINE :

Semi-automatic machines manufactured are available in different models

according to its capacity and technical feature. The types of machines are semi-

automatic due to technical specification. Fuzzy logic operation is not available in

semi-automatic type.

1) HYDROSHAKTI—3.5 KG

The new Hydroshakti 3.4 kg is an aesthetically designed washing machine with

galvanized powder coated steel body that occupies little space. Its size might

deceive for a moment. The unique Hydroshakti wash technology gives clothes a

powerful and superior wash.

FEATURE—

● Compact and space saver

● Detachable drain hose

● Strong and sturdy

● Twin timer

● Rust proof design

● Heavy duty design

● Liquid balancing system for effective spin drying

● Thermally protected motors

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2) HYDROSHAKTI-5.5 KG

Hydroshakti 5.5 kg is very durable and of good quality washing system.

FEATURE--

● Unique 4-way wash system

●Up to 30% saving on detergent

● Galvanized powder coated steel cabinet for longer life

●Scrubber board

TECHNICAL FEATURES-

●High Ribbed Hydroshakti Pulsator-

The uniquely angled position of the high ribbed pulsator is in Onida Hydroshakti.

The ribs and 20 fins in between empower the water with tremendous force. It is

almost like a miniature typhoon.

●Hercules wash motor-

This is powered by the improved 400 watts, 320-rpm ,Hercules motor and a 180

Watts , 1400 rpm spin motor.

●Spin tub-Stainless steel/enamel coated spin tub to prevent it from damp.

3) ECOWASH 5.5:-

According to the customer’s needs and preferences this machine is most

economical in all respect by fulfilling all the needs.

FEATURES-

Unique scrubber board

400 Watts wash motor

Advanced high ribbed pulsator

180 watt spin motor

4) HYDROSHAKTI 6.0:-

This is provided with Pulgitator technology.

Pulsator + Agitator = Pulgitator

Pulgitator wash technology makes this washing a unique buy.

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FEATURES-

Galvanized powder coated steel.

Auto braking.

Power wash 400 watts of Hydroshakti motor.

4 way wash systems.

5) HYDROSHAKTI 6.5(XXL):-

This is available in two models

Plastic body

Metal body

A) PLASTIC BODY- Its cabinet is made up of fully plastic body that is having life

long warranty.

Features-

Large capacity of 6.5 Kg

Rust proof fully plastic cabinet for longer life

Fine hair filter

1 + 3 pulsator

Mice proof design

B) METAL BODY - It is manufactured with two material metal and plastic

outside cabinet is of metal and inner body is plastic special painted cabinet

integration technology makes this machine different from any other . A steel outer

case coupled with plastic inner tub makes it safe and reliable and promises a

noise proof wash.

FEATURES

1 + 3 pulsator this unique mechanism directs the flow of water into each and

every part of your clothes.

Large capacity 6.5 Kg of pure washing pleasure

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LILIPUT 6.5 KG WASHING SYSTEM(WITHOUT DRIER)

● Capacity 6.5 kg

● Weight 12 kg

● Motor 270 watts

● Gear Box

● Buzzer

● Rat Mesh

FULLY AUTOMATIC MACHINE

A highly advanced washing machine that has minds its own! The thinking ONIDA

pro fuzzy can select its own wash modes most suitable for your clothes. With 6-

Kg capacity and 1500 wash combination the ONIDA pro fuzzy can handle any

wash load and fight the stubborn stains.

FEATURES –

One touch fuzzy logic operation

Bio-soak wash course

Fast wash course

Mega pulsator wash system

Auto power off

Self-diagnostic features

Auto balance corrector

Water saver

Smooth ergonomically curved design

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MARKETING RESEARCH PROCESS AND

RESEARCH METHODOLOGY

arketing managers often commission formal marketing studies of specific

problems and opportunities; they may request a Market Survey, a Product

Preference Test, a sale forecast by region or an advertising evolution. Marketing

research is the systematic design, collection, analysis and reporting to data &

finding relevant to specific marketing situation facing the Company.

Effective Marketing Research involves the five steps as shown in the figure.

Before making the research plan, the researcher should be very clear about the

objective of conducting that research. It should not be defined too broadly or too

narrowly to him. The research design details the Procedure necessary for

obtaining the required information. The basic Purpose is to design a study that

will help in reaching out to our objective. It will help the decision maker for more

accurate and balanced decision.

Exp lo ratry Stage

Fo rm u lati n g th e p ro b lem

D eterm in e in fo rm ati on n eed

an d so urce

C o n clu sive stage

D e sig n th e re se arch & C o lle ct th e d ata

P ro cess an d ana lyze the data

R ep o rt & u se in fo rm ati o n

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RESEARCH PROBLEM:- It tries to sharpen and precise the mgt. Problem in

hand. The research Problems covers in total the management problem, but it

focuses only one core issue, which is to be highlighted while carrying out the

research. The result out of the study would not only answer the research problem

but also look into other issues, which were highlighted while discussion.

The important tasks that are involved in the formulation of the problem are-

Discussion with the decision maker

This is the most important part of the formulation of the research as it is

done to help the decision maker. Therefore, a proper discussion at regular

intervals is must. The brainstorming sessions help in refining the problem and

understanding the context of the problem.

Interview with expert: -

This gives an outsider an accurate view of the problem in hand. Here, the

discussion was held with the distributor and other persons.

SECONDARY DATA ANALYSIS:-

This is very much useful in formulation as well as analysis of the problem

because it uses the output of research already carried in this area. Actually in this

case maximum emphasis was given on secondary data, as we are studying

company’s strategy prevailing now, and it can be gathered through established

and well distributed facts & information. We are not so much concerned with the

primary data for what company is doing, as what company is doing is secondary

in nature itself.

Qualitative research:-

The other important step in the formulation of research problem is the use of

qualitative research. All the issues and especially some critical ones cannot be

made quantitative. A qualitative research was done by visiting many dealers

informally , going to market and discussion with people. Actually this was done to

know about the impact of strategy adopted by the company. And the finding of

the research has been shown in recommendation part.

Environmental context:-

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The whole problem then has to be viewed in the environmental context. That’s

why a study on the industrial scenario in the consumer durable sector was

undertaken. It help’s in understanding the industry in which the company is

operating and the major factors affecting the industry.

METHOD0LOLGY:-

This section helps in giving a shape to the work outline. It indicates the general

methodology followed for the study.

The study would use a combination of qualitative as well as quantitative and

primary as well as secondary sources. The major study would be based on

outcome of the session with executive of the company and with the

distributors/dealers.

DATA COLLECTION PORCEDURE:-

Data collection is a very important part of the project and the result or the whole

study depends on the tools and technologies used for data collection.

STAGE 1:- Data would be collected from the local newspaper advertisements or

the internet. The first phase is exploratory in nature, all the possible sources

would be exploited to get the data.

STAGE 2:-Data is collected from company’s official and from distributors /

dealers. The survey would be an interview cum questionnaire schedule.

Data Sourse

Secondary

Internal External

Primary

Survey

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Sales RecordsCredit Records

INTERNAL DATA

BooksMagazinesJournalsPeriodicalsCompany website

EXTERNAL DATA

TeliphonicGroupIn-DepthMail SurveyQuestionnareDelphi technique

SURVEY

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DISCUSSION WITH COMPANY’S EXECUTIVE

There views were taken regarding company’s present status in Siliguri city, their

objective and what steps they have taken so far to overcome the previous

drawbacks.

What types of plans they are making to tap Siliguri market and Vidarbha region.

How much they give importance to customer relation management as their

marketing strategy point of view.

What extra effort they are doing to generate awareness among the people.

What was the market situation in July 2009 (at the time of relaunching the

product) and improvement has been occurred so far after introducing the present

strategy.

DISCUSSION WITH DISTRIBUTORS AND DEALERS-

How much they are satisfied with present schemes (regarding margin, timegiven

for payment, dealer enhancement scheme) .

How much do they affect the decision process of customer.(Please refer

recommendation no-2).

What suggestion they would like to give to increase sales.

Their opinion about price, service, technology etc was also taken .

DISCUSSION WITH CUSTOMERS-

How much are they aware regarding the company’s product?

What they feel regarding the after sales service of the company (regarding the

company of which they are having the product).

Suggestion for the company (Mirc Electronics Ltd.) they would like to give on

consumer point of view.

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WAHING MACHINE INDUSTRY: AN

ANALYSIS ON NATIONAL PANORAMA

BJECTIVE

The study is conducted with the following objectives under consideration:

* To understand the evolution of the washing machine industry in India and to

study the various factors contributing to its growth viz. social, cultural,

technological and economic.

*To examine the product profile of the industry and to study the structure of the

market in terms of market shares of different types of washing machine

segments.

*To study the major players in the industry with their product mix, marketing

strategies and highlight their future plans.

1) GROWTH AND EVOLUTION OF THE WASHING MACHINE INDUSTRY IN

INDIA :

Washing machines made their mark in the Indian market in the eighties.

Videocon was the first company in India to introduce washing machines. Over

the years, it has remained a market leader, with a overall market share of 35% by

adopting flexible strategies, which are modified as and when the need arises.

Initially, the challenge was to wean away homemakers from their traditional

methods of washing clothes. But then, owing to high prices, the market appeared

to be limited only to upper income urban households. The 1990s saw a change in

the socio-economic scene in the country. Rapid growth, increase in the number

of working women, changing life styles and higher aspirational levels with

exposure to satellite television and easy consumer finance meant that demand

for consumer goods rose phenomenally. Sales of semi-automatics outstrip those

that in the fully automatic segment. This has been due to a variety of factors,

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price being one of them. As semi-automatic washing machines are cheaper than

the fully automatic ones. The semi-automatic varieties are in the range of Rs

4,500 to Rs 10,500, fully automatics for Rs 13,000 to Rs18,000 and new

generation fuzzy logic machines come for above Rs18,000.Moreover fully

automatic machines require continuous water supply (for each wash cycle, the

water is changed 2-3 times), which is a rarity in most Indian cities. However, the

fully automatic machine seems to be gaining market share on the back of a

growing demand for fully automatic machines. As shown in table 1.1while semi-

automatic washing machines formed about 65% of the market share at the time

of the study conducted by Orient Paper Industries Ltd. (OPIL) and LG Electronics

of Korea it was predicted that its share would fall to 30% in the year 2005.

Table 1.1: Production Estimates analysis carried by OPIL and LG Electronics

Year Production(’000s) Fully-automatic(%) Semi-Automatic(%)

1994 450 30 70

1995 600 35 65

1998 1030 55 45

2000 1490 55 45

2002 1970 61 39

2005 3000 70 30

In India (just as in USA), top-loading machines (technically referred to as vertical

or V-axis) account for 95% of all machine sales (in USA it is 98%), unlike Europe

where front-loading (H-axis) machines dominate. Problems with bending, water

leakage and child safety concerns work against H-axis machines.

Washing machines sales by type Type %

Top Load(twin tub) semi-automatic 79.5

Top Load fully –automatic 14.8

Front load 5.7

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According to the report now the total number of branded washing machines

selling in India is about one million and the current market penetration is about

3% the highest being 8% in the urban areas. It is estimated that the automatic

models will grow faster and the larger sizes will gain market share due to the

reducing prices, rising levels of disposable income and availability of consumer

financing and also due to the increasing replacement demand. However it is

estimated that the 5-Kg will remain to be the largest selling segment as it suffices

the requirements of nuclear families.

Table 1.3: CIER survey of Market Growth Rates

Year Percent

1990-91-1996-97 22.8

1996-97-2001-02 17.2

2001-02-2006-07 15.0

It is evident from the table 1.3 that the market is growing at a decreasing rate but

as seen in Table 1.4 that in spite of the decreasing trend in market growth rates,

the market in absolute terms is increasing and is expected to grow in future also.

Table 1.4: CIER survey of demand for washing Machines

Demand: Past and Future

Year Numbers ( in Thousand )

1990-1991 210

1991-1992 260

1992-1993 310

1993-1994 375

1994-1995 450

1995-1996 600

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1996-1997 720

1997-1998 860

1998-1999 1010

1999-2000 1190

2000-2001 1380

2001-2002 1590

2006-2007 3200

Table 1.4: CIER survey of demand for washing Machines

The washing machine market has expanded beyond expectations from around

450,000 machines in 1994-95; the industry has recorded a rate of expansion

higher than 20%. According to CIER Market Forecasts and Indicators. This high

rate of growth is attributed to

a) Relative low base and low penetration ratio in the past

b) Changes in the lifestyle of the expanding middle class

c) Expanding monetary incomes

d) Rising participation rate of women

e) Impact of TV advertising on mental makeup of women in particular and the I

I urbanized families in general

f) Thrust of the MNCs in the market with their global brands

g) The product upgradation

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2: PRODUCT PROFILE

Front-loading washing machine

A clothes washer, or washer, is a machine designed to wash laundry, such as

clothing, towels and sheets. The term is mostly applied only to machines that use

water as the primary cleaning solution, as opposed to dry cleaning (which uses

alternative cleaning fluids, and is performed by specialist businesses) or even

ultrasonic cleaners.

History

To clean clothing it is necessary to rub and flex the cloth to break apart solids

and help the soap penetrate. At first this was done by pounding or rubbing the

clothing with rocks in a river, and later developed into the corrugated wash board.

In Roman times a person would whiten clothing by rubbing it against a rock while

letting soap lay on it. The soap was made of animal fat.

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Irreler Bauerntradition shows an early Miele washing machine in the open air

museum Roscheider.

Clothes washer technology developed as a way to reduce the drudgery of this

scrubbing and rubbing process by providing an open basin or sealed container

with paddles or fingers to automatically agitate the clothing. The earliest

machines were often hand-operated. As electricity was not commonly available

until at least 1930, these early machines were often operated by a low-speed

single-cylinder hit and miss gasoline engine.

Because water usually had to be heated on a fire for washing, the warm soapy

water was precious and would be reused over and over, first to wash the least

soiled clothing, then to wash progressively dirtier clothing. While the earliest

machines were constructed from wood, later machines made of metal permitted

a fire to burn below the washtub, to keep the water warm throughout the day's

washing.

Removal of soap and water from the clothing after washing was originally a

separate process. The soaking wet clothing would be formed into a roll and

twisted by hand to extract water. To help reduce this labour, the wringer/mangle

was developed, which uses two rollers under spring tension to squeeze water out

of the clothing. Each piece of clothing would be fed

Washing machine milestones

19th-century Metropolitan washing machine

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A vintage German model

The first English patent under the category of Washing and Wringing Machines

was issued in 1691 by Miss Bea Ferguson. A drawing of an early washing

machine appeared in the January 1752 issue of "The Gentlemen's Magazine," a

British publication. In Germany, Jacob Christian Schäffer's washing machine

design was published in 1767. In 1782 Henry Sidgier was issued a British patent

for a rotating drum washer. In 1862, a patented "compound rotary washing

machine, with rollers for wringing or mangling" was shown at the 1862 London

Exhibition, done by Richard Lansdale of Pendleton, Manchester.

The first United States Patent titled "Clothes Washing" was granted to Nathaniel

Briggs of New Hampshire in 1797. Because of the Patent Office Fire of 1836, no

description of the device exists, and it is not known what kind of washing device

Briggs invented. A device that combined a washing machine with a wringer

mechanism did not appear until 1843, when John E. Turnbull of Saint John, New

Brunswick patented a "Clothes Washer With Wringer Rolls."

Electric washing machines were advertised and discussed in newspapers as

early as 1904. Louis Goldenberg of New Brunswick, New Jersey invented the

electric washing machine around the late 19th century to early 20th century. He

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worked for the Ford Motor Company at that time, and all inventions he created

while working for Ford under contract belonged to Ford. The patent would have

been listed under Ford and or Louis Goldenberg. Alva J. Fisher has been

incorrectly credited with the invention of the electric washer. The US patent office

shows at least one patent issued before Mr. Fisher's US patent number 966677

(e.g. Woodrow's US patent number 921195).

US electric washing machine sales reached 913,000 units in 1928. However,

high unemployment rates in the Depression years hit sales; by 1932 the number

of units shipped was down to about 600,000.

The first laundromat opened in Fort Worth, Texas in 1934. It was run by Andrew

Clein. Patrons used coin-in-the-slot facilities to rent washing machines. The term

laundromat can be found in newspapers as early as 1884 and they were

widespread during the depression. It is almost impossible to determine who had

the first laundromat. England established public wash rooms for laundry along

with bath houses throughout the 19th century.

Washer design improved during the 1930s. The mechanism was now enclosed

within a cabinet, and more attention was paid to electrical safety. Spin dryers

were introduced to replace the dangerous power wringers of the day.

Early automatic washing machines were usually connected to the water supply

via temporary slip-on connectors to the sink taps. Later, permanent connections

to both the hot and cold water supplies became the norm. Most modern front-

loading European machines now only have a cold water connection (i.e. cold fill)

and rely completely on electric heaters to raise the water temperature.

By 1940, 60% of the 25,000,000 wired homes in the United States had an

electric washing machine. Many of these machines featured a power wringer,

although built-in spin dryers were not uncommon.

Bendix introduced the first automatic washing machine in 1937, having applied

for a patent in the same year. In appearance and mechanical detail, this first

machine is not unlike the front loading automatic washers produced today.

Although it included many of the today's basic features, the machine lacked any

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drum suspension and therefore had to be anchored to the floor to prevent

"walking".

1910 advertisement

Many of these early automatic machines had coin-in-the-slot facilities and were

installed in the basement laundry rooms of apartment houses. After the attack on

Pearl Harbor, US domestic washer production had to be suspended for the

duration of World War II. However, many US appliance manufacturers were

given permission to undertake the research and development of washers during

the war years. Many took the opportunity to develop automatic machines,

realizing that these represented the future for the industry.

An improved front loading automatic model, the Bendix Deluxe (which retailed at

$249.50), was introduced in 1947.

General Electric also introduced its first top loading automatic model in 1947.

This machine had many of the features that are incorporated into modern

machines.

A large number of US manufacturers introduced competing automatic machines

(mainly of the top loading type) in the late 1940s/early 1950s. Several

manufacturers even produced semi-automatic machines, where the user had to

intervene at one or two points in the wash cycle. A common semi-automatic type

(available from Hoover in the UK until at least the 70's) included 2 tubs: one with

an agitator or impeller for washing and/or rinsing; another, smaller, tub for water

extraction or centrifugal rinsing.

One early form of automatic washing machine manufactured by Hoover used

cartridges to program different wash cycles. This system, called the Keymatic,

used plastic cartridges with key-like slots and ridges around the edges. The

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cartridge was inserted into a slot on the machine and a mechanical reader

operated the machine accordingly. The system did not commercially succeed

because it offered no real advantage over the more conventional program dial,

and the cartridges were prone to getting lost. In hindsight it can be seen as a

marketing gimmick rather than offering any really useful functionality.

Since their introduction in the late 1930s/mid 1940s, automatic washing

machines have relied on mechanical timers to sequence the washing and

extraction process. Mechanical timers consist of a series of cams on a common

shaft. At the appropriate time in the wash cycle, each cam actuates a switch to

engage/disengage a particular part of the machinery (e.g. drain pump motor).

The timer shaft is driven by a small electric motor via a reduction gearbox.

On the early mechanical timers the motor ran at a constant speed throughout the

wash cycle, although it was possible for the user to truncate parts of the program

by manually advancing the control dial. However, by the 1950s demand for

greater flexibility in the wash cycle led to the introduction of electronic timers to

supplement the mechanical timer. These electronic timers enable greater

variation in such functions as the wash time. With this arrangement, the electric

timer motor is periodically switched off to permit the clothing to soak, and is only

re-energised just prior to a micro-switch being engaged/disengaged.

Despite the high cost of automatic washers, manufacturers had difficulty in

meeting the demand. Although there were material shortages during the Korean

War, by 1953 automatic washing machine sales in the US exceeded those of

wringer-type electric machines.

In the UK and in most of Europe, electric washing machines did not become

popular until the 1950s. This was largely because of the economic impact of

World War II on the consumer market which did not properly recover until the late

1950s. The early electric washers were single tub, wringer-type machines,

automatic washing machines being extremely expensive. During the 1960s, twin

tub machines briefly became very popular, helped by the low price of the Rolls

Razor washers. Automatic washing machines did not become dominant in the

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UK until well into the 1970s and by then were almost exclusively of the front-

loader design.

A 1950s model

In early automatic washing machines, any changes in impeller/drum speed were

achieved by mechanical means or by a rheostat on the motor power supply.

However, since the 1970s electronic control of motor speed has become a

common feature on the more expensive models.

Early front loading machines, especially those manufactured in Mediterranean

countries (e.g. Italy), had low spin speeds (e.g. 800 rpm or less). Nowadays, a

spin speed of 1200 rpm is common and a peak spin speed as high as 1600 rpm

is available on many machines. Now models in Europe have speeds of 1800 rpm

and a few European washing machines have a spin speed of 2000 rpm.

However, because they were not susceptible to gravitational forces, some early

top loading machines had spin speeds in excess of 1000 rpm, although some

were as low as 360 rpm. Most US top-loading washers have spin speeds less

than 1000 rpm.

In the early first decade of the 21st century, the British inventor James Dyson

launched a type of washing machine with two cylinders rotating in opposite

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directions; which, it is claimed, reduces the wash time and produces cleaner

results; however, this machine is no longer in production.

In the early 1990s, upmarket machines incorporated microcontrollers for the

timing process. These proved reliable, so many cheaper machines now

incorporate microcontrollers, rather than mechanical timers. Washing machines

are a classic application for fuzzy logic. Miele, from West Germany, was the top

of the line front load washer, and was introduced in Kananaskis, Alberta by

Glenn Isbister starting a revolution in Laundry in Canada.

In 1994, Staber Industries released the System 2000 washing machine, which is

the only top loading, horizontal-axis washer to be manufactured in the United

States. The hexagonal tub spins like a front loading machine, only using about

third of the water as conventional top-loaders. This factor has led to an Energy

Star rating for its high efficiency.

In 2001, Whirlpool Corporation introduced the Calypso, the first vertical-axis high

efficiency washing machine to be top-loading. A washplate in the bottom of the

tub nutated to bounce, shake, and toss the laundry around. As this happened,

water containing detergent was sprayed on to the laundry. The machine proved

to be good at cleaning but gained a bad reputation due to frequent breakdowns

and destruction of laundry and the washer was recalled with a class-action

lawsuit and pulled off the market.

In 2007, Sanyo introduced the first drum type washing machine with ‘Air Wash’

function. This washing machine uses only 50L of water in the recycle mode.

In 2008, the University of Leeds created a washing machine that uses only a cup

(about 0.5 imperial pints (280 ml)) of water to carry out a full wash. The machine

leaves clothes virtually dry, and uses less than 2 per cent of the water and

energy otherwise used by a conventional machine. As such, it could save billions

of litres of water each year.

Modern machines

This section is missing citations or needs footnotes. Please help add inline

citations to guard against copyright violations and factual inaccuracies. (June

2010)

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Modern washing machines are available in two configurations: top loading and

front loading.

Market Share

Market Top Loading Washer Front Loading Washer

European Market Share 10%** 90%

US Market Share 65% 35%

It should be noted that while 10% of European washing machines may be top-

loading they are not of the same design as North American machines. Rather

than washing the clothes with an agitator, they also use a horizontally-mounted

drum. The clothes are loaded through a hatch in the drum wall. Their design is

otherwise similar to that of a front loader. These machines may work well for

small apartments as they take up less floor space than a conventional front

loader.

Top-loading

The top-loading design or V-axis clothes washer, most popular in Australia, New

Zealand, Canada, the United States and Latin America, places the clothes in a

vertically-mounted perforated basket that is contained within a water-retaining

tub, with a propeller-like agitator in center of the bottom of the basket. Clothes

are loaded through the top of the machine, which is covered with a hinged door.

During the wash cycle, the outer tub is filled with water sufficient to suspend the

clothing freely in the basket, and the movement of the agitator pulls the clothing

downward in the center towards the agitator paddles. The clothing then moves

outward and up the sides of the basket to repeat the process. Top-loaders are

not well-suited to cleaning large objects such as pillows or sleeping bags due to

the tendency for them to just float on the surface of the water without circulating,

and the aggressive agitator action can damage delicate fabrics.

In most top-loading washers, if the motor spins in one direction, the gearbox

drives the agitator; if the motor spins the other way, the gearbox locks the

agitator and spins the basket and agitator together. Similarly if the pump motor

rotates one way it recirculates the sudsy water; in the other direction it pumps

water from the machine during the spin cycle. Because they usually incorporate a

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gearbox, clutch, crank, etc., top-loading washers are mechanically more complex

than front loading machines but are generally lower maintenance since there is

no need for a door seal (described below). However, the electro-mechanical

components in conventional top-load washers have largely reached maturity.

The top-loader's spin cycle between washing and rinsing allows an extremely

simple fabric softener dispenser, which operates passively through centrifugal

force and gravity. The same objective must be accomplished by a solenoid-

operated valve on a front loader. Another advantage to the top loading design is

the reliance on gravity to contain the water, rather than potentially trouble-prone

or short-lived front door seals.

Arctic BE1200A+ is a front loading budget model sold in 2008 with 6 kg load,

LCD indicator, 1200 RPM

Front-loading

The front-loading design or H-axis clothes washer, most popular in Europe and

the Middle East, mounts the inner basket and outer tub horizontally, and loading

is through a door at the front of the machine. The door often but not always

contains a window. Agitation is supplied by the back-and-forth rotation of the

cylinder and by gravity. The clothes are lifted up by paddles on the inside wall of

the drum and then dropped. This motion flexes the weave of the fabric and forces

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water and detergent solution through the clothes load. Because the wash action

does not require the clothing be freely suspended in water, only enough water is

needed to moisten the fabric. Because less water is required, front-loaders

typically use less soap, and the aggressive dropping and folding action of the

tumbling can easily produce large amounts of foam.

Front-loaders control water usage through the surface tension of water, and the

capillary wicking action this creates in the fabric weave. A front-loader washer

always fills to the same low water level, but a large pile of dry clothing standing in

water will soak up the moisture, causing the water level to drop. The washer then

refills to maintain the original water level. Because it takes time for this water

absorption to occur with a motionless pile of fabric, nearly all front-loaders begin

the washing process by slowly tumbling the clothing under the stream of water

entering and filling the drum, to rapidly saturate the clothes with water.

Front-loading washers are mechanically simple compared to top-loaders, with the

main motor normally being connected to the drum via a grooved pulley belt and

large pulley wheel, without the need for a gearbox, clutch or crank. But front-load

washers suffer from their own technical problems, due to the drum lying

sideways. For example, a top loading washer keeps water inside the tub merely

through the force of gravity pulling down on the water, while a front-loader must

tightly seal the door shut with a gasket to prevent water dripping onto the floor

during the wash cycle. This access door is locked shut during the entire wash

cycle, since opening the door with the machine in use could result in water

gushing out onto the floor. For front-loaders without viewing windows on the

door, it is possible to accidentally pinch fabric between the door and the drum,

resulting in tearing and damage to the pinched clothing during tumbling and

spinning.

Nearly all front-loader washers for the consumer market must also use a folded

flexible bellows assembly around the door opening, to keep clothing contained

inside the basket during the tumbling wash cycle. If this bellows assembly were

not used, small articles of clothing such as socks could slip out of the wash

basket near the door, and fall down the narrow slot between the outer tub and

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basket, plugging the drain and possibly jamming rotation of the inner basket.

Retrieving lost items from between the outer tub and inner basket can require

complete disassembly of the front of the washer and pulling out the entire inner

wash basket. Commercial and industrial front-loaders used by businesses

(described below) usually do not use the bellows, and instead require all small

objects to be placed in a mesh bag to prevent loss near the basket opening.

This bellows assembly around the door is the source of problems for the

consumer front-loader. The bellows has a large number of flexible folds to permit

the tub to move separately from the door during the high speed extraction cycle.

On many machines, these folds can collect lint, dirt, and moisture, resulting in

mold and mildew growth and a foul odor. Some front-loading washer operating

instructions say the bellows should be wiped down monthly with a strong bleach

solution, while others offer a special freshening cycle where the machine is run

empty with a strong dosing of bleach. In the past, suggested remedies have

included adding vinegar to the laundry detergent, running an empty cycle with

bleach every few weeks, wiping the door gasket with a diluted bleach solution

every other week, and leaving the front-loading washer door ajar between loads.

Further comparisons

Top-loading washers do not suffer from continued maintenance problems and

needs no regular freshening. During the spin cycle, a top-loading tub is free to

move about inside the cabinet of the machine, using only a lip around the top of

the inner basket and outer tub to keep the spinning water and clothing from

spraying out over the edge.

There are many variations of these two general themes. Top-loading machines in

Asia use impellers instead of agitators. Impellers are similar to agitators except

that they do not have the center post extending up in the middle of the wash tub

basket. There is also a top loading variant of the horizontal axis design that is

loaded from the top, through a small door in the circumference of the drum.

These machines usually have a shorter cylinder and are therefore smaller, but

offer the efficiency of a front-loader while eliminating the problems of the flexible

bellows. This kind of washing machine is sold and popular in Europe, especially

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in small households, because it offers the same drum system as front-loaders,

just with a smaller footprint.

Many front loading machines have electrical heating elements to heat the wash

bath to near boiling. Chemical action is supplied by the detergent and other

laundry chemicals. Front loaders use special detergents that are designed to

release different chemical ingredients at different temperatures. This is so that

different type of stains and soils will be cleaned from the clothes as the wash

water is heated up by the electrical heater. Front loaders also need to use low

sudsing detergents because the tumbling action of the drum folds air into the

clothes load that can cause over-sudsing. Due to the concentration of water and

detergent, though, the sudsing issue of front-loaders can also be controlled by

simply using less detergent without lessening cleaning action.

Tests comparing front loading and top loading machines have shown that, in

general, front-loaders wash clothes more thoroughly, cause less wear, and use

less water and energy than top-loaders. As a result of using less water, they

require less detergent to be used, or conversely, they can use the same amount

of detergent with less water, which increases detergent concentration and

increases the amount of chemical action. They also allow a dryer to be more

easily mounted directly above the washer.

Water leakage

Top loading machines are less prone to leakage. Front loading machines require

a seal on the front door, and similarly the front door must be latched during

operation to prevent opening, lest large amounts of water spill out. This seal may

leak or require replacement. Many current front-loaders, though, can be stopped

and added to or removed from, by way of keeping the water level in the

horizontal tub below the door level.

Energy usage

Some top-loader advocates have argued that a top-loader leans more towards

efficiency with dramatically faster wash times, although comparisons of energy

use show this to be wrong—front loaders use less energy, water and detergent

and clean more effectively than the best top loaders.

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Water usage

Front loaders generally use less water than top-loading residential clothes

washers. Estimates are front loaders use anywhere from about one third

(About.com) to one half (Consumer Energy Center) as much as top loaders.

Compactness

Front loading machines may be installed underneath counters. A front loading

washing machine, in a fully-fitted kitchen, may even be disguised as an ordinary

base cabinet/unit. They may also be convenient in homes with limited floor area,

since the dryer may be installed directly above the washer.

Spin-dry effectiveness

Front loaders also offer much higher spin drying speeds of up to 2000 RPM. This

makes it possible to dry clothes very quickly by hanging them on washing lines or

airing racks or can substantially reduce the length of time required in a tumble

dryer.

Noise

Front loaders tend to operate more quietly than top loaders, since there is less of

a tendency to imbalance.

Accessibility and Ergonomics

Front loaders are more convenient for little people and those with paraplegia, as

the controls are front-mounted and the horizontal drum eliminates the need for

standing and/or climbing.

For people who are sufficiently tall and can stand, top-loaders may be easier to

load and unload, since reaching into the tub does not require stooping. However,

this issue can be mitigated due to the offering of risers (usually with storage

drawers underneath) to raise the front loader door opening closer to the user's

level.

Rinsing

Washing machines perform several rinses after the main wash to remove most of

the detergent. Modern washing machines use less water due to environmental

concerns, however this has led to the problem of poor rinsing on many washing

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machines on the market, which can be a problem to people who are sensitive to

detergents. The Allergy UK website suggests re-running the rinse cycle again.

Maintenance wash

Washing machine manufacturers are now advising users to perform a regular

maintenance wash which cleans the inside of the washing machine. A

maintenance wash is performed without any laundry on the hottest wash

programme, using either one of the following: white vinegar, a detergent with

bleaching properties (it is not advisable to put actual bleach inside the washing

machine or you could use a proprietary washing machine cleaner. The purpose

of a maintenance wash is to remove any mould, bacteria, old detergent residue

and gunge. If using white vinegar, it is important to allow the washing machine to

fill for about 30 seconds before adding the vinegar, as the first bit of water goes

into the sump.

European standards

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The EU requires washing machines carry an efficiency label

Capacity and cost are the main considerations when purchasing a washing

machine. If intended for use by a small family, a capacity of under 5 kg should be

sufficient (thus saving energy and running costs).

Washing machines display an EU Energy Label with grades for energy efficiency,

washing performance and spin efficiency. Grades run from A to G (best to worst),

providing a simple method for judging running costs and performance. For

example a "Triple A" (AAA) rated machine indicates lowest energy consumption,

best wash and best water extraction (i.e. spin) performance. This has had the

desired effect of driving customers toward more efficient washing machines and

away from less efficient ones.

One important factor that's missing from the energy labelling scheme is the

washing machine's rinsing performance, which can adversely affect allergy

sufferers and people who are sensitive to laundry detergents and chemicals. It is

advisable to check an independent consumer report on how well a washing

machine can rinse before purchasing, as newer washing machines use a lot less

water than older ones.

This section requires expansion.

United States standards

Top-loading and front-loading clothes washers are covered by a single Federal

Standard regulating energy consumption. The Federal Standard effective up until

January 1, 2011 includes no restriction on water consumption. Therefore, washer

manufacturers face no legal restriction on how much unheated rinse water may

be used, in washers manufactured before that date.

Many US-market clothes washers are more energy-efficient and water-efficient

than required by the mandatory Federal Standard, or even the more stringent

Energy Star standard. Manufacturers may be motivated to exceed legally-

mandated standards by a program of direct-to-manufacturer tax credits.

Excessive energy conservation in the laundering process may lead to less-than-

satisfactory cleaning, and excessive water conservation may lead to poor rinsing.

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Commercial washing machine

Commercial washing machines in a self-service laundromat

A commercial washing machine is intended for more frequent and long-term

usage than a consumer washing machine. Because function is more important

than style, most commercial washers have a sharp-edged square appearance,

often with stainless steel exteriors to minimize rust and corrosion in a constantly

moist environment. They are built with large easy-to-open service covers, and

the washer mechanisms are internally laid out in a manner that does not require

access to the underside of the unit for service. Often commercial washers are

installed in long rows with a wide access passageway behind all the machines to

allow maintenance without moving the heavy machine.

Many commercial washers are built for use by the general public, and are

installed in publicly accessible laundromats or laundrettes, operated by money

accepting devices or card readers. The features of a commercial laundromat

washer are more limited than a consumer washer, offering just two or three basic

wash types plus an option to choose wash cycle temperatures. The common

front-loading commercial washing machine also differs from consumer models in

its expulsion of wash and rinse water. While the consumer models pump used

water out allowing the waste line to be located above the washer, front loading,

commercial machines generally use gravity to expel used water. A drain in the

rear, at the bottom of the machine opens at the appointed time during the cycle

and water flows out. This creates the need for a trough behind machines which

leads to a filter and drain. the trough is usually part of a cement platform built for

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the purpose of raising the machines and can be seen behind washers at most

laundromats.

Commercial washers for business (still often referred to as a washer/extractor)

can include extra features that are never seen in the consumer market. Many

commercial washers offer an option for automatic chemical injection of five or

more different chemical types, so that the operator does not have to deal with

constantly measuring out soap products and fabric softeners for each load.

Instead a precise metering system draws the detergents and wash additives

directly from large liquid-chemical storage barrels and injects them as needed

into the various wash and rinse cycles.

Some computer-controlled commercial washers offer the operator complete

control over the various wash and rinse cycles, allowing the operator to program

custom washing cycles.

One special type of continuous-processing washer is known as the tunnel

washer which does not have separate, distinct wash or rinse cycles, but

combines them all in sequence inside a single long large-diameter rotating tube.

Industrial washing machines

A 1980s Belgian 180kg load industrial washer in Hotel Hilton, Brussels

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A 1980s Belgian 90kg load industrial washer.

An industrial clothes washer can be used to batch process up to 300 pounds

(140 kg) of textiles at once, and can be used for extremely machine-abusive

washing tasks such as stone washing or fabric bleaching and dyeing.

An industrial washer can be mounted on heavy shock absorbers and attached to

a concrete floor so that it can extract water from even the most severely out-of-

balance and heavy wash loads. It may be mounted on hydraulic cylinders,

permitting the entire washer to be lifted and tilted so that fabrics can be

automatically dumped from the wash drum onto a conveyor belt once the cycle is

complete.

Washing machine manufacturers

Alliance Laundry (Speed Queen)

Antonio Merloni under the brand names Asko, Ardo, Philco and Servis

Arçelik - including the brand names Beko, Blomberg, Altus and Arctic

Bosch - including the brand names Siemens, Neff, Balay, Profilo and

Constructa

Candy - including the brand names Hoover and Zerowatt

Continental Girbau

Dexter Laundry

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Dyson (No longer produced)

Electrolux - including the brand names AEG, Frigidaire, John Lewis, Rex,

Tricity Bendix, Zanussi and Zoppas

Fagor - including the brand names Brandt, Thompson, Ocean and

SanGiorgio

Fisher & Paykel

IFB

GE - including (in the United States) the brand name Hotpoint

Haier

Hitachi

Indesit - including the brand names Hotpoint-Ariston, Creda and Scholtes

LG

Mabe - including the brand names Easy, Centrales, Dako, Moffat

Miele

Mueller Eletrodomésticos

Pellerin Milnor

Samsung

Smeg

Staber

Whirlpool - including the brand names Admiral, Amana, Inglis, Kenmore,

Maytag, Magic Chef, Estate, Kirkland and Roper

Thor

Bendix

Gorenje

V-Zug - including the brand names Sibir and Gehrig

Schulthess - including the brand name Merker

Amica

Vestel

Washex

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Role in women's liberation

The historically laborious process of washing clothes has at times been labelled

"woman's work" and women from all classes tried to find ways to get relief from

doing laundry.

In 2009, L'Osservatore Romano published an article entitled "The Washing

Machine and the Liberation of Women" that was controversially meant to

demonstrate that the washing machine had done more for the liberation of

woman than the contraceptive pill and abortion pill, which are often associated to

Women's Day. The article shocked Italian feminists and provoked criticism from

Opposition MP Paola Concia. A study from Université de Montréal also

presented a similar point of view to that of L'Osservatore

2.1 Segmentation : Washing machines can be segmented on the following

bases-

2.1.1 Segmentation based on Functions:-

Washing machines can be classified as washers, semi automatic and fully

automatic machine on the basis of their functions.

* Washers: Washers are simple machines, which wash clothes but do not dry

them. They are minimal in functions and are mainly manufactured in

unorganized sector. These are single tub machines and are very low in price.

These machines are becoming obsolete in the urban areas due to their

inefficiency in performing certain functions.

* Semi automatic or Twin tub: These machines have two tubs, washing tank and

drying tank. They perform more function than the washers but the sequencing

and duration of each stage of the process like washing, rinsing and drying

operations have to be controlled manually. Clothes need to be physically

transferred from one tub to the other.

*Fully automatic: These are compact machines in which clothes are washed and

dried automatically in a single drum. Depending upon the type of fabric and total

weight of the clothes the wash combination is selected and the wash cycle is

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carried out automatically. Fully automatic washing machines require a continuous

stream of water for operating smoothly. Fully automatic washing machines can

be further categorized based on the way the clothes are loaded in the machine.

--Top Loading: In these types of machines, clothes are loaded from top. The

advantage offered is that clothes can be added or removed from the machine

even when washing is in process. Majority of the machines available today fall in

this category.

-- Front loading: In these machines, clothes are loaded from the front. They are

supposed to be superior in temperate climates, and are typically used in tumble

washing machines. Among the domestic manufacturers IFB and Electrolux are

the only one's with front-loading option.

* Fuzzy Logic: These are the most advanced machines, which work on the

principle of fuzzy logic. They sense the type of fabric and the dirt content on

clothes and adjust the intensity of washing action accordingly. These washing

machines require a continuous stream of water for operating smoothly.

2.1.2 Segmentation based on the kind of Wash Action Washing machine can

also be segmented on the kind of washing action employed in the machine.

Essentially there are three types of washing action, which are as follows:

*Pulsator wash: The rotation of the motor driven impeller generates pulses which

create strong turbulence in water, helping the detergent solution to penetrate

deep into the fabric. Pulsator wash is absolutely harmless to clothes as water is

used to brush against them.

* Agitator wash :This kind of washing action is somewhat akin to washing by

hands since the agitator rubs against the clothes like a brush.

*Tumble wash: The steel drum into which the clothes are loaded rotates

clockwise and then anti clockwise. Thus, the detergent gets to mix evenly

ensuring a thorough wash. This action is considered most efficient in temperate

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Table 2.1 The comparison of the three washing action on some parameters

TYPE PULSATOR

WASH

AGITATOR

WASH

TUMBLE WASH

Detergent Any detergent Any detergent Non foaming

Construction Simple

construction and

lightweight

Manufacturing is

complex on

account of

frequent

subassemblies

compel assembly

of the machine

many parts and

Service Low and easy Medium Difficult to

maintain due to

complicated

construction

Water

Consumption

Low Medium Medium

Example- BPL Sanyo Whirlpool IFB industries

2.2 Features Available in Washing Machines

Some of the features available in the washing machines are as follows-

*Wash combination: Many different types of wash combinations are offered

which differ in intensities such as gentle, normal and heavy wash suited for

various fabric types.

*Hot wash cycle: The user has the choice of washing at temperatures ranging

from room temperature to 95 degrees Celsius.

*Pre wash cycle: The user can remove major dirt portions from clothes in the

machine itself before performing the actual washing operation.

* Half load program: The user has the option of reducing the spin speed and the

water quantity depending upon the number of clothes to be washed.

*Inlets: There are specific arrangements for the introduction of bleach agent and

fabric softeners.

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3: DEMAND DETERMINANTS OF THE INDUSTRY:-

1.PRICE

The demand for washing machines is price sensitive and as the prices have

fallen due to increased competition among various old and new entrants, the

demand has risen. The demand is price sensitive because of low levels of

disposable income. However, with excise duties not likely to fall further (they are

already at the 18% levels India was to achieve under the WTO) in the near

future, slashing prices cannot remain feasible as a strategy for too long.

2. LOW PENETRATION LEVELS

According to the ORG-MARG reports rural India constitutes about 64% of the

total number of households. However, rural penetration levels remain lower than

in urban areas as seen in Table 3.1 Rural penetration levels of refrigerators stand

at 2% and washing machines 0.5%. These figures reflect the potential demand

for players to exploit. Now as the rural India is upgrading the companies can try

to tap this market, which offers huge potential.

3. INCOME LEVELS

With rising levels of real disposable income and the consequent change in

aspirational levels, branded durables have become a thing of proud possession,

especially for the emerging middle class. A survey by NCAER shows that in

coming years consumers will be willing to spend more than187.04 Rs(at 1986

prices) on washing machines. This creates the demand for washing machines.

4. AVAILABILITY OF FINANCING

Availability of hire-purchase schemes is one way of making price-sensitive

consumers spend as these schemes help in delayed payments schedule. With

financial institutions and commercial banks vying to catch the attention of

consumers, the schemes lead to increased discretionary spending power.

5. PRODUCT CUSTOMIZATION

According to the National Council for Applied Economic Research (NCAER), lack

of electricity is a major reason hampering the growth in demand for durables in

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rural areas. Moreover, at many places where electricity is available, it does not

remain for long or the voltage is too low. Perhaps Indian companies need to

follow the African example. There the consumer durables market witnessed a

boom when companies introduced fans, refrigerators and TVs that ran on

kerosene and batteries. Something innovative on similar lines can be thought for

the Indian market as well.

6. REPLACEMENT DEMAND

As newer and better products invade the market and people have larger

disposable incomes, the demand for replacing older products is slated to rise.

Companies have, thus, embarked on discount and exchange schemes, which

help break the inertia and the sense of guilt associated with disposing off an old

refrigerator or a washing machine. This helps bring forward the replacement

cycle in the market.

In an India Today-IMRB survey on consumer spending among 2,045 people

spread across six cities, about 20% of the respondents admitted to having

replaced at least one durable product in the past three years.

Experts have said that the replacement market in India will remain active due to

wide income disparities, which exists in our society.

7. INCREASED MARKETING EXPENDITURE

As the competition in the industry is increasing, the companies in the market are

increasing their expenditure on advertising, sales promotion and distribution. This

helps in creating awareness and subsequently leads to creating demand. The

consumer durable companies are also entering the rural markets looking at the

huge potential it offers.

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Players in the industry:

1. VIDEOCON APPLIANCES:-

Videocon Appliances manufactures washing machines, air conditioners and

refrigerators.

MANUFACTURING FACILITY:

The company has a manufacturing facility at Chittegaon, Aurangabad,

Maharashtra where all its products are manufactured. The company is in the

process of setting up a new facility at Banglore, Pune and Chengalapattu.

PRODUCTS:

The company has products for all the segments. It has substantial presence in

the mass market.

ALLIANCE:

A joint venture proposals to set up two separate companies - one each for

washing machines and airconditioners - was cleared by the Foreign Investment

Promotion Board (FIPB) in February 1997. The company in both, its ventures

with the Japanese company, Matsushita, would be holding a 30 per cent stake,

while the Japanese company would hold the remaining 70 per cent stake.

DISTRIBUTION:

The company focuses on the mass market and operates primarily through

regular dealers. It also has company owned dealer points. The company now

outsources its servicing to the independent service providers in both the urban

and rural areas.

2 . B P L SANYO UTILITIES & APPLIANCES LTD.

The company manufactures domestic appliances like washing machines,

vacuum

cleaners microwave ovens and other home appliances.

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48

PRODUCT: BPL has a wide range of semi Automatic and fully Automatic

washing Machines. It claims that all its washing machines come with a unique

Pressure cleaning Technology in which an angled Pulsator creates powerful

waves of water that jet through the weaves of the fabric and dislodge deep-

seated dirt without damaging clothes.

MANUFACTURING FACILITIES:

It currently has manufacturing facilities at Noida, U.P.

DISTRIBUTION:

The company sells through both regular dealers and company owned dealer

points. The company plans to expand its distribution network and increase the

retail points to 2,400 from 1,500. The thrust is likely to be in the grade B and C

cities and the company hopes to use the distribution chain as a vehicle to piggy-

ride the frost-free models.

3 GODREJ-GE APPLIANCES LTD.

Godrej –GE is a 60:40 joint venture between Godrej &Boyce and US based GE

formed in 1993.

INVESTMENT:

In the year 1996 –97 it invested Rs 220 crore on two hi-tech plant –A washing

machine plant at Shirwal(300000 units per annum capacity)and third refrigerator

facility at Mohali (500000 units per annum capacity).

PRODUCTS:

Washing machines are marketed under two brand names, Godrej and GE. The

washing machine takes clothes in from the top, but is claimed to deliver the

benefits of a front-loading machine. The machine is designed to save space and

offers 18 wash programmes with the option of varying the temperature. The 5.5

kg Smartwash Fuzzy Logic System was the first to offer a 24 hour programme.

SALES MANAGEMENT:

In September 1998 they instituted a new sales and marketing structure. Now it

has a same sales for both refrigerator and the washing machine. In GGEA the

sales function is looked after by two V.Ps who directly report to the M.D. This

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49

leaves the marketing department free to concentrate on the long term strategic

planning.

DISTRIBUTION:

GGEA has a network of 6000 direct dealers and 6000 distributors spanning

across 2500 cities and towns. GGEA has a resource sharing agreement with the

Phillips and Dunlop which helps it to curb the rising transportation cost.

CONSUMER FINANCING:

It has taken up the consumer financing in conjunction with Country wide finance

and 4% of its 1997 –98 sales came through the finance schemes and is expected

to double this year. The company has an advertising budget of around 4% of its

turnover. Godrej GE Appliances Ltd (GGEAL) is in the process of finalising a

‘strategic' arrangement' with SBI-GE Caps to finance the purchase of white

goods.

MARKETING STRATEGY:

They have decided to address different consumer categories on the basis of

need, price, and features. Simultaneously, they are making sure that the Godrej

brand remains, to emphasise the quality it is related with – reliability and

durability. The old sub brand names were retained while trying to create a new

image around them as these had been substantially invested in.

4. LG ELECTRONICS

LG group had entered the Indian market in April, 1997, with three products –

colour televisions, refrigerators and washing machines. South Korean white

goods giant LG electronics has begun exports from its Indian manufacturing

base. The rural market accounts for 30% of its sales and it hopes to increase it to

50%.

PRODUCTION:

LG was importing the fully automatic washing machines in 1997. By mid 1998 it

established its own facility at Noida.

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50

DISTRIBUTION:

LG sells in more than 2000 towns and cities with a population of 1 lakh persons

and above. It also intends to reach as many as 50000 plus towns. The company

has 40 distributors and 2000 dealers and plans to increase the no to 100 dealers

and 3000 dealers. Branch offices at the end of every month have just the 40% of

the requirements of the next month, with the rest being replenished by 15th. LG

gives no promotion schemes to the dealers as it wants the consumer oriented

thinking do the job. It just banks upon the consumer pull and does not let its

pricing power be diminished by the retail trade which could easily be tempted to

give discounts. Normally in case of schemes the shops bait customers on price

by sacrificing their own margins and availing the sales volume scheme money

from the companies. LG also does not allow much credit to the dealers, which

saves it the capital and also incentives the dealers to make intelligent demand

projections and move the products fast of the shelves.

SEGMENTATION AND MARKETING STRATEGY :

It has segmented the market on the ‘reason to buy ‘ basis . The fully automatic

washing machine was called the Chaos+3 a water punch that detangles clothes

before washing them efficiently. The advertising was straight and simple. The

company believes in value marketing and will not sacrifice value for keeping the

price low or large volumes.

SUPPLIES: The plant keeps no more than 15-20 days of imported parts.

5. ELECTROLUX - KELVINATOR:-

Electrolux enjoys 4 to 5 per cent of the total market share, but it has around 30

per cent of the front load washing machine market. IFB and Electrolux are the

only two players in the front load segment. The company is trying to break

ground in washing machines. In a 0ne million unit market dominated by top-load

machines, it is trying to make inroads with Electrolux's front-load models, which

AB Electrolux specialises in worldwide. It has also taken over the white goods

facility of is planning to import two new products directly from Sweden.It has

already launched its first washing machine earlier this year, which has got a good

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51

response from the market. The expansion of the Shahjahanpur factory is

complete it is geared up to make four lakh units annually.

DISTRIBUTION:

They are also planning to expand our dealer network by an estimated 15 to 20

per cent this year from the existing level of 2,000. The company wants to get into

every town with a population above 20,000 ultimately. The process of market

mapping is currently on.

MARKETING STRATEGY:

Electrolux has lined up a major marketing and advertising thrust and doubled its

advertisement budget for the year to Rs 20 crore. There would also be a

considerable trade push, through commercials, visibility campaigns. The

company would also participate in local events to promote the products. The idea

is to identify with local moods and concepts.

6. WHIRLPOOL OF INDIA LTD:-

BACKGROUND:

Whirlpool Corporation of US ,entered the Indian market in 1987 with a joint

venture with the Madras-based TVS group. In 1995, the company bought a

controlling interest in Kelvinator India and subsequently merged its operations

under the banner of Whirlpool of India. In Pondicherry it has acquired a washing

machine plant from the TVS group in 1996.

MANUFACTURING FACILITIES:

The company has manufacturing facilities at Pune,Faridabad and Pondicherry for

the refrigerators and washing machines.

DISTRIBUTION:

The after-sales services for its products is provided by its more than 30 servicing

branches spread across the country. The company has an integrated sales and

distribution network of over 4000 dealers.

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MARKETING STRATEGY:

Whirlpool unleashed a massive brand building campaign. Whirlpool was

positioned as a company that listened to the customer and then developed a

product around it, not the other way round. The company believes that the brand

has the ability to command a premium: 3-5 per cent over other brands. Whirlpool

tracks four areas of Brand building [through external agencies] - top-ofmind

awareness, brand awareness, brand preference and advertising cut-through.

The company emphasizes on being the manufacturers of quality products, and

will not subscribe to the price war in the domestic market. With its white goods

portfolio now considerably expanded, the company expects to break even at the

end of the year.

7. SAMSUNG INDIA ELECTRONICS LIMITED:-

The Consumer electronics and white goods major Samsung India Electronics'

(SIEL) has so far invested nearly Rs 100 crore in the country its stake in the

Indian subsidiary from has been raised from 51 per cent to 74 per cent.

MARKETING STRATEGY:

SIEL which felt that it was lagging in brand image awareness had spend $10

million during 1998 to promote image.

Analysis AND DATA Interpretation

The analysis part is very much important as on this basis, we would be able to do

SWOT analysis and based on this analysis ,recommendation would be given to

the company with special reference to Siliguri city.

Data Collected from dealers

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REASONS FOR TAKING PARTICULAR DEALERSHIP:

Sr.no Criteria No.of Dealers Percent(%)

1. Brand Name 22 27.5

2. Customer

Demand

20 25

3. Margin 16 20

4. Quality 20 25

5. Others 02 2.5

Total 80 100

27%

25%20%

25%

3%Brand Name

customer Demand

Margin

quality

Others

From the above data, it is observed that most of the dealers give their preference

to brand name & quality.

Their (Onida dealer) Satisfaction level regarding margin, incentives ,privileges ,

other assistance given by the company (sample size-36)

Very much satisfied 5

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Satisfied 15

Not satisfied 16

Very much satis-fied

Satisfied Not satisfied0

2

4

6

8

10

12

14

16

18

NOW THE QUESTION WAS ASKED FROM THE UNSATISFIED DEALERS

THAT WHAT MIGHT BE THE REASONS FOR THEIR UNSATISFACTION

(YOU CAN TELL SOME OTHER REASONS TOO )

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55

Customers

don’t ask for

particular

brand

Don’t get much

support for

sale from

company

Product

components

are not easily

available

Lack of

adequate

support from

CRC, so after

sales service

period is long

No. of dealers

(out of 16)

12 8 8 6

CRC-customer Care Center:

From the above data it can be concluded that the dealers were unsatisfied on

more than one reason. Here it is also reflected that people are also not very

much aware regarding the company’s washing machine so dealers were unable

to sell the product even after the product has good quality and better

performance.

Their rating for different companies on the basis of product awareness,

availability, product quality and after sales service

Name of the

company

Product

awareness

Product

quality

Product

availability

After sales

service

Videocon 10 8 6 7

Whirlpool 9 8 7 7

LG 9 8 6 8

Samsung 8 7 6 7

Electrolux 7 8 6 7

onida 4 8 4 6

IFB 6 7 5 7

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Here from the above content it is quite clear that Videocon,Whirlpool

LG ,Samsung have great awareness level, as far as product quality is concerned

approximately all companies are having good product quality(in the technology

available) . But the leader i.e. Videocon is now getting itself in a difficult situation

as far as to make available of the product in the dealer’s shop is concerned

(N.B.- This is a point to be noted) . Regarding after sales service provided by the

different companies, it can be concluded that LG is having best customer service

and Onida should take learning from that and try hard to improve its customer

care center’s performance.

WHEN CUSTOMER COME FOR TAKING WASHING MACHINE, WHICH

BRAND THEY NAME FIRST –(GIVE THE RANKING )

1st Videocon

2nd Whirlpool

3rd LG

4th Samsung

5th Electrolux

6th IFB

7th Onida

8th Others

Here from the above information we can say that Videocon, Whirlpool, LG ,

Samsung have their stake in customers’ heart in well amount and Mirc

electronics must take a glance on these observations and do some extra efforts

to catch the competitors.

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From customers:

First, we enquired about the people having w/m or not WHO CAME TO

DEALER’S SHOP.

Sample size = 100

Total No. of person having washing machine = 58

Total No. of person not having washing machine = 42

58%

42%persons hav-ing w/m

persons not having w/m

It can be concluded that there is a big population that is untouched and there is a

great scope for promotional activity.

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FROM PERSONS HAVING WASHING MACHINE, WE TOOK THE DETAILS

REGARDING COMPANIES, OF WHICH THEIR WASHING MACHINE IS

Videocon 28 48.27%

Whirlpool 10 17.24%

LG 4 6.89%

*BPL 6 10.34%

Onida 2 3.44%

IFB 1 1.72%

Others(Samsung,

Daewoo,etc)

7 12.76%

48%

17%7%

10%

3%2%

12% Videocon

Whirlpool

LG

BPL

Onida

IFB

Others

Here it can be said that videocon is the market leader and way ahead than its

nearest competitor.

(* BPL is going to exit itself from w/m sector. So there is a opportunity for the

company to capture that market.)

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DO THEY KNOW THAT ONIDA HAS COME UP WITH WASHING MACHINE

WITH SOME NEW FEATURES AND IMPROVEMENT (CHECKING

AWARENESS LEVEL)

Yes 15

No 85

Yes

No

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Here from the above chart it is quite clear that there is a dire need to create some

programme where it can be revealed that company has done some innovations

regarding the product and if it is better than others then on what basis.

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Customer Rating to Onida’s corporate image.

Rating Scale No. Of Responses Remarks

9-10 26 Excellent

7-8 34 Good

5-6 20 Satisfactory

1-4 10 Poor

No Rating 10 can't say

From the above it can be concluded that ONIDA is a good brand in the eyes of

customer and this reputation can be encashed in Washing Machine segment.

CUSTOMER CRITERIA FOR PURCHASING WASHING MACHINE

Sr. No. Criteria Response Nos.

1 Quality 61

2 Price 30

3 After Sales Service 22

4 Brand Loyalty 15

It is quite clear that some people prefer more than one factor while purchasing a

product, so company should pay attention on all these factors to attract the

customers. tamal

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MARKETING STRATEGY: AN OVERVIEW

arketing Strategies Are Largely Shaped By A Number Of Factors That

Include --

penetration levels of products

position or market share of the company

competitor’s strategies

changes in the consumer buying behavior

changes in consumer’s perceived needs

changes which occur in technology

A commonly used and highly successful marketing strategy is to make available

to consumers such product and service features that mark them as different from

the rest. Companies need to position their products to various segments

separately as each segment will have a different need and will require different

features to satisfy these needs.

Competition is forcing many companies to stop shouting hoarse about USPs

(Unique Selling Propositions) that only they can believe will sell, and peddle

product-benefits. As long as there were 4-5 products competing for the

consumer's attention in a category, each could spin its own intangible

differentiation around lifestyles, values, and attitudes. This approach became

impractical with entry of many more. Customers find it difficult to distinguish

between competing brands that tried to associate themselves with similar

aspirations. The simplest way to cut through the clutter is an emphasis on

product benefits. Not only does this approach bestow brands with strong tangible

benefits, it ensures a sufficient bang for promotion. Discounts will work only if the

consumer is convinced about the product. Evidently, an increasing number of

companies are realizing that 'Consumers seek product benefits and tend to

remember brands that (claim to) fulfill that promise'.

LG Electronics’ strategy includes developing non-traditional channels of selling

even while it continues to strengthen its retail sales network.

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The company has banded together small teams of people to be attached to its

branch offices to carry out brand promotions in smaller cities and towns.

Electrolux follows its multi-pronged strategy, which includes aggressive product

launches, focus on quality and increased rural reach. The company is focusing

on building a strong market for its 35-year old brand -- Kelvinator. The company

plans to offer a range of solutions for its washing machines segment. Electrolux

plans to introduce low-end top loading, twin-tub machines; a fully automatic

machine and a range of front-loading washing machines from Italy's Portrayals.

The company has launched a new model washing machine --1045 model -- that

provides four rinses as against three rinses of all other washing machines. The

fourth rinse removes the dirt and soap residues completely from the fabric.

Electrolux is organizing demonstrations/road shows at retail outlets and

apartment complexes to explain the four-rinse mechanism through a four-bucket

test.

The group has outlined a multi-brand marketing strategy aimed at customers at

the high-end, upper end and middle income and lower segments. The company

will have different marketing strategies for different customer segments. The

focus will also be on the price-sensitive rural markets. In fact, to push the

products, the dealers are trained such that they are able to explain the value-

addition to prospective customers.

At the top-end, the company's products are priced higher than the competitors.

The company is getting direct and fast and its strategy for growth this year

includes consolidation of its existing operations and entering new product

segments. Electrolux has put the Internet on the forefront of its sales strategy.

With 'Market based Management' being the guiding principle, Samsung's

strategies to achieve its 'Millennium Leap-15bn' target include: 

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In its attempt to position its products as an ‘elite’ product and improve brand

visibility, companies have sponsored TV programmes on various channels.

Samsung, LG, IFB and Electrolux sponsored movies on the Star Movies network;

Samsung and IFB, for instance, sponsor the Saturday and Sunday night

premieres. LG has lately sponsored the most talked about programme on Star

Plus, Kaun Banega Crorepati?, hosted by the famous Bollywood star Amitabh

Bachchan.

CUSTOMER SERVICING:-

A business area, which assumes much importance in this sector, is that of

customer servicing. The word ‘customer’ will include both the external (i.e the

customer to whom the company sells the products) as well as the ‘internal’

customer which is nothing but the dealer – an important constituent of the value

chain.

In order to distinguish one’s offerings from that of the others, firms are trying to

add more value-added services in their product portfolio. Godrej-GE, for

example, has succeeded in etching out a name in the customer’s mind by paying

serious attention to customer services. It intends to leverage its formidable

distribution strength (6000 dealers and 6000 distributors) for the purpose. There

are two aspects to their service leverage: one, use it to help support their current

product range and two, to develop it as a business in it’s own right . The new

plans to be implemented in this regard are:

Introduction of service technician vans so that more spare parts can be carried

to

the homes of the people who register complaints .

Setting up Intelligent Care Centers to create a centralized system for

registering

consumer complaints/queries. This helps in keeping track of the all the

complaints and assigning jobs to the service personnel accordingly.

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Effect calls registration on complaints by providing a ticket number, thus making

service processing easier. It also helps to build up a database of customers for

direct marketing as the details of the customers can be used for cross selling to

them (For selling other products)

Train freelance technicians, especially in smaller towns and give them a Godrej

authorized status. Franchising the services to expand reach.Offering a Godrej-

GE customer card, which entitles the buyer to avail of special gifts on purchases

of any Godrej-GE product.

New entrant LG Electronics has decided to give a strong push to strengthening

Its service network. A string of consumer promos like free service weeks, annual

maintenance plans, loyalty programs, special offers to last year buyers and

honeymoon packages for newly wedded couples are in the pipeline.

Samsung, on the other hand, has gone hi-tech in order to please its customers.

Each Samsung service center has been made on-line to its head office in Delhi,

which in turn is linked to its headquarters in Seoul. A software keeps a

comprehensive record of all service calls attended—customer history, nature of

the complaint, time taken to respond, spare parts used etc.

Electrolux AG has developed an electronic mail handling system to channel

customer responses to the area of the group best equipped to deal with any

query.

Electrolux now has a via medium to communicate with their customers, know

which products they like, what problems they have. From now on, it will be the

customers who would drive product development.

MARKETING :-

Branding strategy for the products. Their assiduously built images over the years

convey the message of leadership to their customers. Videocon International, for

example, has brought about a change in their logo to convey the message of

precision, quality and technical edge in all company activities. In their TV ad

campaign, Videocon Industries Limited says that they were the first company in

India to introduce frost-free refrigerators and fully automatic washing machines.

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The whole range of consumer durables being produced and sold by the company

is described in the belief that consumers for these goods often overlap and they

tend to go for the same brand. The strategy clearly is to impress upon the buyers

that theirs is the best available. Lately some companies like Samsung, LG, IFB

and Electrolux have thought of sponsoring movies on the Star Movies network.

Samsung and IFB, for instance, sponsor the Saturday and Sunday night

premieres respectively. Electrolux, on the other hand, is one of the main

sponsors for a special package of Oscar awarded movies in the month of

February 1999. These moves can be a pointer to the Electrolux management’s

strategy of trying to position their products in the ‘elite’ market.

BUSINESS STRATEGY:-

Like any other consumer durable, sales of washing machines is largely

dependent on how well a company plans out their marketing strategies which

help increase visibility and build a distinct brand image. A commonly used and

highly successful marketing strategy is to make available to consumers such

product and service features that mark them as different from the rest.

LG Electronics by bringing out a high-technology “Chaos Punch” machine has

ensured that clothes do not remain tangled while being washed. Next on line is

the ‘Fabricare’ sub-brand, which takes a detour from the earlier technology

positioning and tries to address the concerns and sensibilities of a modern

woman. Its new adline says – “LG Fabricare – Because you should never hurt

the ones you love”. Fabricare ensures that not only it cleans all your clothes but

also it does it with enough ‘care’ so as not to damage them.

Samsung too has mounted the technology bandwagon and come out with a

“Boomerang Pulsator” wash system endorsed by the well-known cricketer Kapil

Dev. This helps to create awareness and builds brand equity for the products. A

classic example of a company responding to a long felt need of Indian

homemakers is Godrej-GE. Recently, it rolled out of its factory Smart-wash Super

Agitator, a 5.5kg twin-tub washing machine with an active soak facility. Now the

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need to keep clothes soaked in water before washing them in a machine will no

longer be felt.

BRANDS:-

Some consumer durable companies have thought it fit to adopt an umbrella

branding Strategy for their products. Their assiduously built images over the

years convey the message of leadership to their customers. Videocon, for e.g.,

has changed its logo to convey the message of precision, quality and technical

edge in all company activities. VIL claims to be the first company in India to

introduce frost-free refrigerators and fully automatic washing machines.

Electrolux Kelvinator is a good example of how a well-known and popular

brand suffers due to a lack of adequate marketing support. One of the early

entrants in the market, Kelvinator also had a limited portfolio of models, lower

brand visibility and had suffered at the hands of indifferent dealers.

PRICING:-

With washing machine sector operating at 34.7% capacity utilization, prices had

touched an all time low in FY99 and with new capacities coming up this year, the

trend is expected to continue.

Penetration pricing is now the name of the game. The strategy is to keep entry-

level prices lower in order to activate demand. A sharp rise in the sales of

washing machines in the first half of FY98/99 had partially been attributed to this.

Prices of semi-automatic machines fell by an average of 15% since January

1998. The biggest fall has been noticed in the cases of Godrej-GE (22%) and

Videocon (12%). In fact, Videocon has introduced a new model breaking the

earlier price barrier of Rs5,000. For the fully automatic segment, the price fall has

been in the range of 6.5% on an average. Unlike the semi-automatics, there is a

large variance in the extent of price declines of the various brands. Also, the

price difference between a semi-automatic and a fully automatic one has

narrowed down considerably.

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DISTRIBUTION:-

Samsung has introduced JIT (Just in Time) to its 2,500 dealers spread across

the country. In order to deliver within 48 hours of the expected date of delivery,

the company has put in place four regional dispatch centers, one at each

regional location of the country. The material is sent from the Central Warehouse

at Delhi to the Regional Distribution Centers (RDCs) and from thereon the right

production mix is made available to the branches as per their weekly plan. The

new system called `Logistics Innovation’, has helped slash the cycle from order

to delivery by at least two days and also reduced inventory levels of finished

goods by 25-30%. For Samsung, it is the dealer’s demand that is now tugging

the bottom-line up.

Samsung has put in place an extensive sales and service network all over India.

A network comprising of 18 branch offices, over 2,500 dealers and more than

300 service centres has been put in place to reach customers. An EDI system is

being implemented through a chit process, which gives the vendor the weekly

purchase plan and the weekly delivery schedule and takes into account a final

delivery confirmation on all the chits as per the specified format. R&D constitutes

the kernel of the company's business philosophy and by setting up an R&D

Centre at Noida, the company hopes to provide its customers with breakthrough

technology products tailored to meet their needs.

LG plans to expand its retail network to 4500 dealers by the year-end FY02. The

company is setting up a specific portal, which will have at least 20% of its dealers

online carrying out all transactions over the net. At present, the company has an

online messaging system with 75 dealers. The company has linked together

small teams of people to be attached to its branch offices to carry out brand

promotions in smaller cities and town. The number of such teams is to increase

to 45 from the existing number of 21. The company will also expand its network

of direct sales to 2,500 lady representatives under 50 team leaders (against the

present strength of 1,000 representatives under 20 team leaders). The company

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plans to step up the company's presence in canteen stores departments of the

Army and Naval canteen by doubling institutional sales through canteen stores

department to 50,000 units from 10,000 units in FY01.

Whirlpool of India has a well-entrenched distribution network comprising of 1,500

distributors and over 5,000 dealers while Godrej-GE has a network of 12,000

dealers. Electrolux has a distribution reach of over 3,500 retail outlets and plans

to increase its distribution network and foray into the rural markets.

OUTLOOK:-

Over the last five years, the market for consumer durables has grown

tremendously and an important catalyst has been the modern working woman.

As disposable income levels rise, thanks partly to the latest Pay Commission

report, aspiration levels have also spiraled upwards. Therefore, women who have

to take care of both the domestic and professional front are increasingly opting

for convenience appliances. However, the family element cannot be ruled out in

the purchase trends seen in Indian homes. A look at the purchase pattern of

consumer durables reveals this. While TVs and refrigerators are essentially for

the whole family and enjoy a relatively higher penetration level, washing

machines, microwave’s etc which is predominantly used by the woman of the

household have a lower penetration as the real disposable income is low and the

washing machine comes after TV and Refrigerator in the list of Priorities of

consumers (As found in a survey conducted by NCAER) .

The low penetration of washing machines (only 0.5% of all households in the

country) is an indication of its potential. However unlike refrigerators, washing

machines have remained largely an urban phenomenon. Buying of a washing

machine is usually due to typical urban reasons such as shortage of household

help and lack of space for drying clothes. Besides working women, other demand

drivers are an aging population, which may find it exerting to manually wash

clothes.

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STRATEGY ADOPTED BY MIRC

ELECTRONICS LTD. FOR PROMOTION

OF WASHING MACHINE

s far as Mirc Electronics is concerned it has dual task before it. The first

job is to build confidence in the heart of distributor and dealers, which had

reached into nadir as the product was withdrawn from the market in 1994 and

they (dealers) had to face difficulties at the time of after sales service from

consumer. The second task is to generate awareness regarding the product . No

doubt ‘Onida’ is a well known brand name in TELEVISION sector of consumer

durable segment, but it is not so very well known in washing machine market.

Viewing these points, the company has made strategies to overcome all the

adversaries and to establish itself as one of the premier players in Vidarbha

region. Company’s top brass have given free hand to their executives operating

in the city for product awareness creation programme, improving dealership

network, suggestion for keeping price level competitive, steps for improving

service of customer care center and recruiting product demonstrators.

Here are the strategies adopted by the company to promote washing machine in

the market of Siliguri city.

Product Positioning-

Two advertising executives Al Ries and Jack Trout popularized the word

positioning. They see positioning as a creative exercise done with a product.

Positioning is the act of designing thee company’s offering and image to occupy

a distinctive place in the target market mind.

Onida has also positioned itself keeping this point taken into consideration. The

Main focus area is growing middle class and working family in the city.

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71

Company and

product

Target customer Benefits Value Proposition

Mirc Electronics

Ltd. - Washing

Machine

Medium- Class

Family

Durability and

Safety

Technology,

Power and

Performance

PRICING :-

Prices are considered to be the major force that keeps the economy in

balance, and it is same in case of an organization too. Actually price is the

value that consumer place on a product and price is termed as the most

flexible component of the marketing mix. And in the era of cut throat

competition price of a commodity plays an important role in keeping its

existence in the market.

As far as Mirc Electronics Ltd. is concerned it is paying attention mainly on two

Pricing objectives. first is sales objective and second is competitive objective.

Here it follows that sales growth would be a reasonable goal of pricing. Here it

has to compete with the many more established brands, so it has tried to keep it

price very much competitive. company has dropped the price of 5.5kg (Ecowash)

by 1000 Rupees to Rs. 7900 to attract the customers.

The company has also adopted flexible price policy. Sometimes they have

reduction in prices for more no. of deliveries. If we have a close look at the price

structure of Onida washing machine, it is clear that company has adopted

odd-even Pricing too.

e.g. Rs.5590,7990,9290,9390 etc. It is nothing but an attempt to follow the form

of psychological pricing.

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72

The pricing policy taken by the company for different categories with taken into

consideration of other companies engaged in the city is as follows-

3/3.5 kg category

Company Capacity Dealer Price Customer Price

Onida 3.5 kg Rs. 4970 Rs. 5590

Videocon 3kg Rs. 4500 Rs. 4990

Whirlpool 3.5 kg Rs. 5400 Rs. 6100

5/5.5 kg category

Onida 5.5kg(Ecowash)

5.5kg(Hydrowash)

Rs.7610

Rs.8500

Rs.7990

Rs.9390

Samsung 5.5kg Rs.9850 Rs.10250

Videocon 5kg Rs.7200 Rs.7690

6KG CATEGORY

Onida 6kg Rs.8800 Rs.9290

Samsung 6kg Rs.8800 Rs.9500

LG 6kg

6kg

Rs.7700

Rs.8500

Rs.8500

Rs.9300

Whirlpool 6kg

6kg

Rs.9924.75

Rs.10571.22

Rs.10450

Rs.11150

Videocon 6kg Rs.8400 Rs.8990

6.5kg/6.8kg category

Onida 6.5kg (metal)

6.5kg (plastic)

Rs.9000

Rs.8900

Rs.9690

Rs.9390

LG 6.5kg Rs.9500 Rs.10200

Whirlpool 6.8kg (aquawash)

6.8kg (hotwash)

Rs.10829.71

Rs.11168.19

Rs.11450

Rs.11900

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73

6kg category-fully automatic

Onida 6kg Rs.15100 Rs.19990

IFB 6kg

6kg

Rs.22500

Rs.23800

Rs.23500

Rs.24800

Samsung 6kg

6kg

Rs.18350

Rs.26000

Rs.19300

Rs.27500

LG 6kg

6kg

Rs.15764

Rs.23546

Rs.16300

Rs.24300

Videocon 6kg Rs.17000 Rs.17990

From the above figure it is reflected that company has tried to keep its dealer

price very much competitive (less than that of LG, Samsung, Whirlpool etc.) But

the price policy of

Videocon is its core competency in this area and it has competitive advantage

over all other players.

As far as dealer margin is concerned Onida gives maximum margin in 5.5 kg

model. In other category it’s dealer margin is equal to or less than that of other

big players.

DISCOUNT :-

We may also take it in price administration. Now a days, all companies make

follow these steps through their dealers, yes quantity of discount may be different

and it is also different for established and a newly branded product. Through

dealers onida has made a policy to give at least Rs. 500 minimum to customer

as discount on cash payment. For its primary customer i.e. for distributors and

main dealers, the company has adopted non-cumulative quantity discount. This

strategy is made to make itself sure that the entire quantity sold will disappear

from inventory.

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74

DISTRIBUTION CHANNEL:-

In consumer durable in most of the cases direct selling does not takes place.

That is there are intermediaries between the companies and end consumer.

These intermediaries are no one but distributors, dealers and sub dealers. They

come under distribution channel of the company. In Siliguri city the company has

two types of distribution channel.

&

DEALERSHIP NETWOORK:-

As the dealers are the connecting link between the company and customers, so

to keep it very strong is very much important and the more no. of dealers is also

necessary to tap the large segment of customer. When company started its

selling from July 2001 since that time they are trying to increase the no. of dealer.

It has been seen that in many case the no. of dealership is directly proportional to

Sell figure.

Company Sub dealars End CustomerDistributor

Company End customerMain dealer

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75

Month-year Distributor Main Dealer Sub-Dealer

July - 2001 1 - 2

August - 2001 1 2 3

September - 2001 1 2 4

October - 2001 1 2 5

November - 2001 1 3 7

December - 2001 1 5 9

January - 2002 1 5 11

February - 2002 1 5 12

March - 2002 1 5 15

April - 2002 1 6 16

May - 2002 1 7 18

June - 2002 1 9 24

July - 2002 1 9 24

August - 2002 1 9 24

September - 2002 1 9 25

October - 2002 1 9 26

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 160

5

10

15

20

25

30

35

40

x-axis-month - year, 1=JULY2001---And so on & y-axis – No. of dealers

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76

LIVE DEMONSTRATION:-

Company has identified it as a tool for creating awareness as will as for sales

promotion activity. As in a survey conducted by (Sample size-500); the

company’s Market

research team, around 80% of the respondent didn’t know about that whether

onida washing Machine exist or not. So to generate awareness; after 2 months

of launching its product company started to do live demonstration activity of its

product in many places. The demonstration places chosen were- Societies,

Corporate offices, Dealer’s shop. As in these places, one can get large no. of

people at one place.

In societies company’s men use to go on Sunday or the day best suited to the

residents of that society. In corporate offices, the time chosen is lunch hour.

Here, the company aim is to create an image of its product in their mind and also

persuade them to buy the product.

There has been a great amount of success rate on company’s point of view as

far as awareness program is concerned. It was also a pleasant moment for sales

personnel as they got a charge of encouragement with this type of unique way of

sales promotion

activity.

*Sale figure

occurred during

the month of

Live

Demonstration

Activity

Month - Year Sale -figure

July - 2009 -

August - 2009 23

September - 2009 25

October - 2009 44

November - 2009 65*

December - 2009 70*

January - 2010 65

February - 2010 64

March - 2010 60

April - 2010 70

May - 2010 85*

June - 2010 125*

July - 2010 123

August - 2010 85

September - 2010 85

October - 2010 90

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77

Jul-0

1

Sep-0

1

Nov-0

1

Jan-

02

Mar

-02

May

-02

Jul-0

2

Sep-0

20

20

40

60

80

100

120

140

Line chart- showing sale figure occurred in different months

CUSTOMER RELATIONSHIP MANAGEMENT;-

Now a day’s customer relation management has become an integrated and

inevitable part at any organization and MIRC electronics is not untouched with it .

As their primary customers are distributors & dealers. So they are trying to make

relationship more friendly. They are doing some sort of things which are very

much part of service industry; but also applicable here . Some of the steps

initiated by the company are-

* Present them some gifts or greeting in the time of birthday of the shop owner.

* Send messages in the time of some events ,for example in Ganeshotsav or in

the time of shop anniversary day etc.

* Give them some extra time to pay the amount if they find that the case is

genuine.

* Provide some gift item meant for end customers to the distributor, free of cost,

so that it may help in enhancing sell growth.

* Recently company has launched a new schemes for them. If they sell 12

machines and achieve the target in 3 months, they will be given a tour package

of Goa.

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78

AFTER SALES SERVICE: -

It is one of the most important factors for a company engaged in home appliance

segment. As lack of service back up was one of the main reasons for

withdrawing its product from the market during 1994. so this time company is

paying more attention on this theme of strategy. Company is trying to reduce the

service time period and it has standardized the service. Some of the focused

areas are-

* If any complain is made before 12 noon, within 2 hrs the problem is solved.

* Home service facility is made available for all types of technical faults as far as

possible. Company’s or Dealer’s men go to purchaser’s home for demonstration

purpose.

* If there is a major fault or a part is to be changed there is an MIS (Management

Information System) in its branch office and an indent letter is immediately issued

to its warehouse, and it is made sure that the part should be available to the

dealer/customer care center same day.

MEDIA ADVERTISEMENT: -

Company gives its advertisement on local newspaper and in local languages too.

They give the advertisement regarding features, its dealership network, current

scehme, live demonstration going an a shop etc. But on national level, electronic

media has not been introduced to the viewers yet.

PATRONIZING OFFER TO CUSTOMER :-

Company has made an optimistic plan to encourage its customer of TV to act

as company’s influencer for other customer. There is a patronizing offer for

them in the form of cash gift. Basically this is done through the dealers of that

area who are acquainted with the old customers. They send a letter to the

customer, which consists of company’s present offer and date and place of live

demo; if it is going on specific shop’s place. Actually it is in initial stage and

company is mostly dependent on dealers for it.

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REPLACEMENT OFFER :-

Company has started a replacement offer too. They have set a criteria for this

purpose. Company’s Service Technician inspects the machine first, then

evaluate it keeping these points into consideration.

* Age of the washing machine i.e. how old is the machine.

* It’s present working condition.

* Condition of the cabinet.

The maximum rebate in this case given is Rs. 2000. The offer is applicable for all

types of washing machines - Fully-automatic, Semi-automatic and Washing

system i.e. without dryer.

0% FINANCE SCHEME: –

Mirc Electronics has taken this as a basic component for sells promotion.

Company has tied up with Bajaj Finance for financing its product washing

machine. They have this scheme for payment mode is up to 24 months.

The Detail is as follow-

Schemes

Models

10 months

(EMI)

12 months

(EMI)

18 months

(EMI)

24 months

(EMI)

Ecowash 5.5 kg

(Rs.7990)

Rs.799 cash

(9 PDC of

799)

Rs. 2663 cash

(8 PDCof 665)

Rs. 2664 cash

(12 PDC of 443)

Rs. 2996 cash

(15 PDC

of2996)

Hydroshakti 6.5

kg

Plastic(Rs. 9390)

Rs. 939 cash

(9 PDC of 939

)

Rs. 3130 cash

(8 PDCof 783)

Rs. 3126 cash

(12 PDC of 521)

Rs. 3519 cash

(15 PDC of 391)

Hydroshakti 5.5

kg

Rs. 939 cash

(9 PDC of 939

Rs. 3130 cash

(8 PDCof 783)

Rs. 3126 cash

(12 PDC of 521)

Rs. 3519cash

(15 PDC of 391)

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80

(Rs. 9390) )

Hydroshakti6.0

kg

(Rs. 9290)

Rs. 929 cash

(9 PDC of 929

)

Rs. 3100 cash

(8 PDCof 775)

Rs. 3096 cash

(12 PDC of 516)

Rs. 3519 cash

(15 PDC of 387)

Hydroshakti 6.5

kg

(Rs. 9690)

Rs. 969 cash

(9 PDC of 969

)

Rs. 3232 cash

(8 PDCof 808)

Rs. 3228 cash

(12 PDC of 538)

Rs. 3636cash

(15 PDC of 404)

PDC- Post Dated Cheque

There is no finance scheme for 3.5 kg.

CONCLUSION

VER THE YEARS MARKETING HAS GROWN FROM A SIMPLE

SALES DEPARTMENT INTO A COMPLEX GROUP ACTIVITIES. MARKET

SITUATION IS SUCH THAT WE CAN NO MORE PASS ON THE COURSE OF

INEFFICIENCY TO THE CUSTOMERS.

On the basis of analysis and data interpretation following conclusion can be

drawn-

Onida washing machine has a low product awareness level in Siliguri city.

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81

It is doing a great effort regarding promotion of the product but due to previous

experience dealers and distributors are cautious this time.

Onida as a brand and as a corporate has a good image in customers mind but

these things are not enough to be successful in other sector too as it has

established a reputed place in TV segment but it is struggling in washing

machine area.

Videocon , whirlpool, LG, Samsung have been placed well in Siliguri washing

machine market.

There is a great scope for washing machine market in the city as still it has low

penetration level and middle class is increasing who are now considering it as a

necessary household product and not as a luxurious item.

DISTRIBUTION CHANNELS IN THE INDUSTRY

The Washing Machine companies in the industry use different distribution

channels to reach the customer.

These are as follows-

1.

.

In this type of channel the company uses its sales representatives to deal with

the dealers directly. The dealers place the order through the sales

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82

representatives who visit them periodically, and the products are delivered

directly from the company. Some companies appoint Direct Dealers who act as

their Franchisee Outlets or their Exclusive showrooms.

*BPL uses this channel

2.

In this channel of distribution the company appoints distributors on the basis of

District/ Population /No of Dealers to be handled by one distributor. The area of

operation and its potential is also taken into consideration.

Some of the companies make the distributor totally responsible from appointing

the dealers to providing after sales service.

*Godrej uses this channel

3.

In this channel of distribution the company appoints Distributors as well as Direct

Dealers. The company appoints distributors to deal with small dealers who order

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83

small quantities. With the dealers who have good potential and sales the

company deals directly.

Daewoo and Samsung use this channel : The Korean Multinational follow

this channel where they appoint Distributors for upcountry towns and

direct dealers for big cities and major towns eg. Kolkata.

4.

In this channel the company appoints a C&F agent who acts on behalf of the

company. The C&F agent is totally responsible for appointment of Distributors

and Direct Dealers. He sells to both the Distributors and the Direct Dealers at the

same rates.

-Whirlpool uses this channel

PEST ANALYSIS

The following analysis gives an overview of the environment in which the

washing machine industry is operating. We have analyzed the Political,

Economic, Sociocultural and Technological environment for the industry.

Political Environment

Finished Product:

▪ Washing Machines below 5 kg capacity are on negative import list in order to

protect the domestic industry. Customers of below 5 Kg segment are very price

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84

sensitive so when foreign players enter the market, they would be offering the

same product at a competitive price which in turn would affect the domestic

players. Therefore the threat from imports in the washing machine segment is

minimal due to quantitative restrictions and high duties.

▪ Under Special Import License washing machine above 5 kg capacity can be

imported because the customers of this segment are not very price sensitive.

This has a dual advantage firstly the government can earn additional revenue

without affecting the domestic players and second that the customers get a

product with additional features which are not available in Indian washing

machines.

Import Duties on Raw Materials:

▪ Import duty on washing machine parts is also as high as 40%.The high

imposition of duty on the imported components discourages the companies to

import their parts and promotes the manufacture of the parts within India. Thus

most of the MNC also source their requirements form the Indian manufacturers

and thus enable the development of the ancillary manufacturing units in India.

▪ The custom duty on the cold rolled sheets required for the outer cabinet is 30%.

As the import is high it discourages import. Thus there is an alternate use of

plastic cabinets by the manufacturers.

Table 6.1: Import duty on Washing Machine and its parts

YEAR WASHING MACHINE WASHING MACHINE COMPONENT

2000-01 35% 35%

1999-2000 40% 40%

1998-99 40% 40%

1997-98 40% 40%

1996-97 50% 50%

1995-96 50% 50%

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1994-95 65% 65%

1993-94 85% 85%

1992-93 65% 65%

1989-90 110% 110%

From the Table 6.1 it can be seen that the import duties on washing machine and

its parts have been gradually reduced from very high levels of 110%-100% in

1989-90. This has been in line with the policy of liberalization adopted by the

Indian government.

Table6.2: Excise duty on Washing Machine and its parts

Year Washing Machine Washing machine components

1999-00 18% 18%

1998-99 18% 18%

1997-98 18% 18%

1996-97 20% 20%

1995-96 20% 20%

1994-95 20% 20%

1993-94 25% 25%

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1992-93 25% 25%

1989-90 20% 20%

From the Table 6.2 it can be seen that the excise duties have been reduced from

25% level in 1994-95 to 18% level in 1997-98 .This helps in increasing

competition in the market place as more players come in and thus results in a

price war. One implication of this is that the customers get a better product at

lower prices.

OTHER LEVIES

Sales tax on washing machines vary from one state to another. The sales tax

along with the excise duty constitutes about 20% of the sales price. Thus any

decrease in these taxes and duties will have a significant impact on the prices

and subsequently boost demand of washing machines.

The reduction in excise duties on washing machines has resulted in a price

decrease. This made washing machines affordable to the middle class

households in India. There was a decline in Rs 400-500 and Rs 800-1000 in

prices of semi-automatic and fully automatic respectively due to this change in

the excise duty from 25% ad valorem to 20% ad valorem in the 1994-95 budget.

The entire range of white goods was perceived as luxury items by the

government and high duties were levied on it. But with the increase in urban

population and the number of working women washing machines have been

recognized as a necessity and the government has reduced the duties applicable

on it.

ECONOMIC ENVIRONMENT:

I. DISPOSABLE INCOME OF THE POPULATION

With the sustained growth in the GDP of approximately 5-6% in the last few

years there has been a high rate of growth in the disposable income of the Indian

households. This has led to a favorable attitude towards consumption and credit

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87

purchases. The NCAER data reveals that the middle (annual household income

between Rs 62,000 and 86,000) and the high (annual household income higher

than Rs 86,000) income segments have grown at a compounded average growth

rate of 13% and 17% respectively between 1989-90 and 1993- 94. This

increases the demand for the washing machines.

II. AVAILABILITY OF CONSUMER FINANCE

Consumer finance has picked up substantially in India though the interest

charged on loans lies in the range of 20%-30%. Consumers are no more averse

to the concept of buying now and paying later. Consumer financing schemes

account for30% of the sales

in 1995-96 on whole India basis, while in the South it accounts for40% of the

sales. The availability of consumer credit has also increased over the last few

years and this gives a boost to the industry as the demand increases.

SOCIOCULTURAL ENVIRONMENT

I. GROWING MIDDLE CLASS

In India it is estimated that 35% population comes under middle income

group.Around 3.5 crore people are tax payee and approximately 8,00,00,000

households fall under middle or upper middle category. Ideally each house needs

a washing machine and present penetration is very low.

▪ Upper middle and high income segment of the population has been growing

faster. Since a major chunk of demand for washing machines comes from this

segment therefore the market for this sector is expected to get larger in the near

future.

▪ Within the upper middle and high income segment, the rural households are

growing at a far more impressive rate than their urban counterparts.

▪ Roughly about 137 million people belong to upper middle and high income

categories i.e. incomes over Rs. 62,000 per household and with per capita

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88

income of Rs 34,500 p.a. This is a fairly large size indicating that the marketing of

‘niche’ products can be the promising area.

II. LIFESTYLE CHANGES

▪ Rising participation rate of women in the income generation is another trend

that has been increasing at a fast pace in India. With more and more working

women the Indian families are on the lookout for alternate ways to do household

chores. Also the declining supply of household workers have led to the

dependency of Indian households on consumer durables like washing machine

and microwaves to do their work. ▪The increase in the spread of cable TVs to a

large majority of the urban households have had led to increased visibility of TV

advertisements to the middle class households. The TV advertisements have

had a impact on the mental makeup of women in particular in the urbanized

families in general.

TECHNOLOGICAL ENVIRONMENT

There has been a trend towards replacement of steel sheets with moulded

plastics such as ABS and PS and other materials in the fabrication of the

washing machine body. This is expected to considerably reduce the raw material

costs of the manufacturers and increase the cost competitiveness of the

manufacturers.

▪ Emergence of new technology like Digital Fuzzy Logic washing machines have

also have an impact on the mindset of the customer. At the touch of a button, the

digital microprocessor senses the wash load, temperature, ideal water level,

wash time, wash type, rinse frequency and other such processes selected for

giving a super clean wash. Some of the concepts that are coming up are:

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89

* Aero Power : A break-through concept where millions of bubbles burst on the

surface of the fabric, generating tremendous energy to wash all the dirt off.

* Triple Cascade Tornado Wash : The powerful 3-way water-flow action causes

hi-speed spinning, splashing and swirling, creating a storm of energy in the wash

tub. Which removes heavy, stubborn stains from your clothes and ensures

detergent solubility that’s three times faster.

*iDigital Intelligence: The digital microprocessor diagnoses the working

conditions and indicates corrective measures to be taken, if required.

* Unique Optical Sensor: An Optical Eye measures the extent and type of dirt,

water quality, type and solubility of detergent to compute the perfect wash.

INDUSTRY ANALYSIS USING PORTER'S FIVE FORCES MODEL

Washing Machine industry in India is of the size of 1010000 units and is

expected to grow at a CAGR of 7%. The various operating in the industry have

been analyzed using the Porter's five forces model. The five forces are as

follows:

* The Threats that a new entrant faces in the industry

* The Intensity of rivalry between the existing players.

* Pressure from the substitutes.

* The Bargaining Power of the buyers

* The Bargaining Power of the supplier

1.THREAT OF ENTRY

BARRIERS OF ENTRY

* Economies of scale :

The players like Godrej, BPL , Whirlpool, Videocon and Lg have achieved

economies of scale. BPL Sanyo has a capacity utilization of 93%. This declines

their unit cost of every function of business and enables them to keep their prices

low. This will force the entrant to come in at a large scale and risk strong

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90

reactions from them or come at a small scale and accept a cost and price

disadvantage.

* Product differentiation:

The companies like Godrej, BPL and Videocon, being very old players in the

Indian market enjoy high brand awareness and consumer loyalties. These brand

names are associated with trust and reliability in the Indian market. The Korean

players like LG and Samsung who engaged in heavy advertising and brand

promotion during the last year have also created a niche for them in the premium

segment. Their brand awareness has grown tremendously after the recent

Cricket World Cup Tournament, during which they advertised heavily.

These create a barrier to entry by forcing the entrant to spend heavily to

overcome existing consumer loyalties and to build a brand image.

* Capital Requirements:

Huge Capital requirements are posed in front of the new entrant in terms of

advertising, product development, production facilities, distribution channel credit,

inventories and for covering up the start-up losses.

* Access to the distribution channels:

- The Indian players like Godrej, Videocon, Voltas and Allwyn which are catering

to the mass market have a strong distribution and dealer network.. They have a

presence in the urban as well as the rural areas. Moreover these companies

have established developed ties with the channel members over the period of

time, which are hard to break.

- Whirlpool has also developed a strong network of 4000 dealers in urban and

semi urban areas in a period of few years.

- The South Korean Majors like Samsung and LG have a dealer network of more

than 1500, mainly in urban areas and plan to expand it in rural and semi urban

areas also. This poses a major threat in front of the new entrant as the existing

firms already serve the channels and the new entrant will have to persuade the

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channels to accept its product through high margins, promotional allowances,

better credit facilities and advertising support, which will reduce the profits.

* Cost disadvantage independent of scale:

- Learning or Experience curve: The old players like Godrej, BPL, Videocon are

high on the experience curve, as they know the Indian Market well. This

experience lowers their costs in production, marketing, and distribution and in

other areas of business, thus giving a cost disadvantage to the new entrant.

- Government policy: The Government policies of levying duties on the imported

washing machines and other taxes gives an advantage to the Indian Players and

in a way protect them from price competition in the market with the MNCs.

* Expected retaliation: The industry as a whole faces excess capacity and the

supply exceeds demand and so the existing competitors are expected to respond

forcefully to a new entrant. The new entrant will face competition based on the

segment to which it tries to cater.

- If the company enters in the Semi Automatic top-loading segment,

Videocon,Godrej, and Whirlpool will pose the major threat.

-If the company enters in the Fully Automatic front loading high capacity segment

(above 5 Kgs) it will have to face main competition from IFB and Electrolux.

2. INTENSITY OF RIVALRY AMONG THE EXISTING COMPETITORS.

The companies in the washing machine industry of India can be divided into four

strategic groups based on the price and the perceived quality of the products.

These groups also differ in their target segments and the strategies adopted to

cater to it.

High Price Medium Price Low Price

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High

Perceived

Quality

1.REMIUM

STRATEGY

IFB,Electrolux

2.HIGH VALUE

STRATEGY

(1)LG, Samsung

Daewoo

(2) Whirlpool, BPL

3. SUPER VALUE

STRATEGY

Moderate

Perceived

Quality

4. SUPER VALUE

STRATEGY

5. MEDIUM

VALUE

STRATEGY

Godrej , Videocon

6. GOOD VALUE

STRATEGY

Low

Perceived

Quality

7.RIP OFF

STRATEGY

8.FALSE

ECONOMY

STRATEGY

9.ECONOMY

STRATEGY

- The companies in the market witness a tough competition from the other

members of its strategic group as they fight for the same chunk of the market. As

their products do not differ much in the features, they try to differentiate their

brands through copy differentiation in advertising.

- The competition intensifies as most of the companies are using the same dealer

network to distribute their products. They lure the dealers to promote their

product by different strategies on margins, incentives and credit and payment

terms.

- The competition increases as all the companies have high Strategic stakes in

the washing machine business. A major fraction of their revenues come from this

business and so they retaliate sharply to any move of the competitor.

- The industry has high Exit Barriers for the members who have invested in the

manufacturing facilities in India in the form of specialized assets.

3. PRESSURE FROM THE SUBSTITUTES:

The washing machine has substitutes like the laundry but due to the increasing

problems with them , people are preferring to switch over to the washing

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machines for washing normal clothes and use laundries for their expensive cloths

and for dry cleaning.

4. BARGAINING POWER OF THE BUYERS:

The buyers of the industry can be discussed as the consumers who are the end

users and the distribution channel members.

A) CONSUMERS

- The bargaining power of the consumers is high due to the presence of many

competitive products in the market. - The Washing machine models available are

not much differentiated in terms of the features, and so the buyers can switch

between the different brands based on other criteria like Price, service, warranty,

promotion and financing schemes.

B) DISTRIBUTION CHANNEL MEMBERS.

The industry players use different intermediateries like dealers, distributors and

the C&F agents for the distribution of its products.

- The bargaining power of the distribution is high as the same dealer deals in the

products of different companies. This increases the bargaining power of the

dealer as he can promote one brand at the cost of another if not satisfied with

one company.

- The existing companies try to provide the channel members with a better deal

than the competitor to lure him to promote their products.

5. BARGAINING POWER OF THE SUPPLIERS:

Not very high

RECENT TRENDS

Market Share of different companies in 2001

Videocon 32%

Whirlpool 17%

LG 14%

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BPL 11%

Samsung 5%

IFB 4%

Electrplux 3%

National 2%

Others 12%

32%17%

14%

11%5%4%3%2%12%

Videocon

Whirlpool

LG

BPL

Samsung

IFB

Electrplux

National

Others

Strategic alliance for Washing machine manufacturing technologies

Indian Company Foreign Company Country

BPL Sanyo Japan

Videocon Matsushita Japan

Whirlpool Whirlpool USA

Daewoo Anchor Daewoo South Korea

LG Electronics LG South Korea

Samsung Samsung South Korea

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SWOT ANALYSIS

he overall evaluation of a company’s strength, weakness, opportunity

and threats is called SWOT analysis.

External Environmental Analysis :-

(Opportunity/ Threat)

In general, a business unit has to monitor key Macro Environment Force

(demographic, economic, technological, political-legal and socio-cultural) and

significant Micro Environment Factors (customers, competitors, distributors,

suppliers) which affect its ability to earn profit. The business unit should t rack

trends and important development to identify thee associated opportunity and

threat.

Internal Environment Analysis :-

(Strength/weaknesses)

It is one thing to discern attractive opportunity and another to have the

competencies to. Each business needs to evaluate its internal strength/weakness

analysis succeed periodically.

STRENGTH

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¨ Product depth is one of the big strengths of the company as the company has

already launched six model of w/m and introducing LILIPUT as its new member

of the family of Onida washing machine.

¨iCompany is introducing w/m in the market with different design and

technology like Onida’s model of 6.5 kg consisting of one big and three mini

pulsator called as 1+3 pulsator and 6.0 kg consisting the combination of

pulsator and agitator called as pulgitator.

¨“Onida” brand name is well known in the market in television sector .So the

company has got the job of generating product awareness only.

¨ Dealer price is also one of the strengths of the company.

WEAKNESSES

¨ Low advertisement is one of the major weaknesses of the company. Due to

low advertisement , most of the people are not familiar with the product, as a

result of which company may lose their prospective customer.

¨ Inadequate no. of service technician is a big drawback..

¨iMany a time materials required for replacement purpose could not be

delivered to service center because of shortage in the warehouse. Sometimes it

take 1 month;and it degrades the confidence level of consumer.

OPPORTUNITY

¨ BPL exit from the market is one of the biggest opportunities. It has around 11%

of market share and here after quitting the market by BPL there will be a gap

and this gap presents a chance for Onida.

¨iIncreasing no. of middle class households, for whom white goods have become

a part of lifestyle and now these things are not luxurious item.

THREAT

¨ Low pricing of the competitors is one of the big threats the company can face.

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Currently VIDEOCON, leader in washing machine segment has lowered its

price,in lower weight category (3kg) which MRP (max. retail price) is

approximately equal to the landing price of other company product.

¨iNew entrants and invent of innovative products by competitors like talking

washing machine by Electrolux may create unlikeliness for Onida’s products.

RECOMMENDATIONS

he following is the concrete list of recommendation that has been

prepared keeping in mind the quantitative and qualitative analysis work done.

All the following factors have been taken into consideration.

1. Product awareness programme should be done aggressively:-

Onida has got good brand image in the market and it has got well market

stabilization in its product like TV, so it is not an impossible task to capture the

market for washing machine, but as the people or market is familiar about the

TV, it is required to make them familiar about washing machine too and for this

purpose product awareness programme should be taken as prime function for

achieving its goal.

Steps to be taken-

Company should take the help of cable network for the purpose of

advertising as city has large number of cable TV connections.

Advertisement using print and electronic media which is one of the

important tool to capture the market.

Introducing washing competition can also help to attract the buyer in the

city, which in turn target women either housewife or working.

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Participating in different types of exhibition like loan mela or trade fair also

helps to increase awareness.

For live demonstration activity contact should be made to some big

departmental stores(super bazaar) of the city. In these places hundreds of

people come for shopping and it creates a great scope for awareness cum

promotional activity

Company should send project trainee into new areas /towns in order to

increase awareness.

Recommended places-Umred, Ramtek, Kondhali, Kalmeshwar

Whenever there is a live demonstration activity going on or if company is

participating in trade fair,these news should be advertised well in advance

for 2 to 3 consecutive days through local dailies.

● It should also emphasize on transit media. In transit media costs of

advertisement is very low and reach is very high.

2. Various types of dealer Incentive scheme should be launched:-

Now a days a substantial portion of sales and marketing expenditure of all

consumer electronics companies is allotted to dealer incentive programmes

(nearly 5% of the product cost). Accompanied by the limited technical knowledge

of an average end consumer, the role of a dealer becomes extremely critical. Not

only does he perform the standard role of channel partner as in other product

(availability, merchandizing,credit and stocking) but also plays a major role in the

consumer buying process.

Types of scheme should be operated-

● Quantity based discount-Such a scheme helps in increasing offtake of dealers

in one shot and also reduces market-operating price, as part of the scheme

generally get passed on. Slab based schemes and model special/bonus also fall

under this category.

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● Target-based scheme

●iiTrip schemes- Dealers find such promotion exciting ,as it gives them an

opportunity to take a break from their hectic schedule and also meet dealers

from other places, besides of course the attraction that the trip locale offers.

● Gift schemes- The advantage of such schemes is that these benefits are

largely retained by the dealers and it adds on to his asset /profitability.

● Surprise schemes-Many more dealers has been running a ‘retention scheme’

every month where a dealer comes to know of the benefit only at the end of the

month.

● Secondary sales linked schemes-In order to movement of stock from the

dealer’s shelf, Company should sometimes incentivize the secondary sale made

from the dealer’s shop. But tracking the secondary sales accurately becomes

logistically complicated and hence difficult to implement on a large scale.

● Advertising cost sharing-This is most popular in southern states, and a lot of

expenditure happens during season and in the New Year.

● Display contest- On the basis of models displayed dealers are either ranked

and incentive should be given to all who participate.

3. Appointing retail sales executive:-

Company should identify some big dealers and there it should appoint a retail

sales executive. It would help in promoting the product which may improve the

market share.

4. After sales service must be improved:-

● Customer care center should be made very effective. In paper there happens

to be everything in the center, but many more times especially in the job of

replacement of spare parts; service is very poor. Main problem lies in colour

combination of the cabinet. So proper attention should be paid in this regard.

● A customer protection plan on all models , where the customer is offered,

beyond the 5 year warranty, additional service protection plans of one and two

years at reasonable prices.

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● A string of consumer promos like free service weeks, annual maintenance

plans, loyalty programs, special offers to last year buyers and honeymoon

packages for newly wedded couples should be offered.

● It should make a decision to go hi-tech in order to please its customer. Its

service center should be made on-line to its headquarter.

[N.B.-This policy has already been introduced by Samsung]

5. Onida should focus its strategy by targeting small dealers too. Many more

dealers who are working in countryside may be small but they have grip over

their customer and paying attention to them can be fruitful.

6. Company should keep track on the new entrants (dealers) in the nearby area

and target them during opening phase of new showroom, so that Onida washing

machine can be integrated first in the shop.

7.iCompany should continuously gather and evaluate ideas for new product

feature, product improvement and services to meet the customer needs.

8. BPL is going to exit it self from the market; which bring an opportunity for the

company to capture BPL’s share and emerging as a big player in the market.

Simultaneously Videocon is lagging behind in the supply of their demand due to

which many of the dealers are dissatisfied*. Right now company can use the

guerilla policy and attack on this weak point by increasing supply in the market.

(Refer point no.14-ii)

9. Dealer meet should be held:-

Dealer meets and dealer conferences are held where company official and

channel partner get a chance to interact with each other and share information,

feedback and market intelligence.

10. Appointing Direct Service Links (DSL):-

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It can prove to be very successful for this particular product. In this method the

company appoints some DSLs whose job is to direct an enquiry to the DSL head.

The DSL head sees to it that the enquiry is liquidated in the sale with the help of

company and dealer’s infrastructure and the DSL is given some commission

based on the sale.For washing machine particular this is very useful, as the

people who want to buy washing machine certainly ask for reference (basically

people people wants to know if ‘this product, of this brand, of this model‘ is being

used by someone ,how is it performing). Innovatively, each and every consumer

of the company can act as a DSL for this particular product and earn some

money back.

11. Company should also present fully automatic range in lower weight category

i.e. in 3.5kg and in 5kg category.

12.iiIt must have it’s own delivery van. As it becomes itself a mode of

advertisement.

13. Suggestion based on competitive advantage selection-

i. Competitive Advantage selection

Competitive

advantage

Company

standing

*1-10

Competitor

standing

*1-10

Importance

of

improving

standing

(H-M-L)

Affordability

and speed

(H-M-L)

Competitors

ability to

improve

standing

(H-M-L)

Recommended

action

Technology 8 8 L L M Hold

Cost 7 8 M M L Monitor

Quality 8 8 L L L Monitor

Service 6 7 H H L Invest

H=high M=medium L=low

*1 for minimum and 10 for maximum

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ii. Customer’s rating of competitors on key success factor

Competitor Customerawareness

Product quality

Product availability

Technical assistance

Selling staff

Competitor A E E rrrrrrrr e E G P* F G

Competitor B E E G G G

Competitor C G E F E F

Competitor D G G G E F

E=excellent G=good F=fair P=poorCompetitor A ---- Videocon Competitor B ---- Whirlpool Competitor C ---- LG Competitor D ---- Samsung *Recommendation- Onida should attack here.

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BIBLIOGRAPHY

Marketing Management - Ramaswami Namkumari

Strategic Management,The Indian Context - R. Sriniwasan

Business Today

Business World

Pratiyogita Darpan

economic Times

Siligurikhhoj.com

Indiainfoline.com

Department of statistics, Siliguri Office.

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