Retail Business to drive Samsung’s Future Growth

 

The retail sector has caught the eye of Samsung. The company is in the process of starting Samsung exclusive IT retail stores and the first store is going to be opened at Nehru Place in New Delhi. This is basically a concept store where the customers will get all sorts of IT products showcased along with convergence built in it. In this store, the company will showcase and provide demos to the end-customers. Elaborating on the theme of this concept store, Sanjay ShaSamsung India, says, “Through this concept store, we are trying to provide a much broader space in the sense that here the customers can get touch-and-feel experience and then go for the products. This initiative will start in December 2006. We will also roll out more retail stores in other bigger cities in 2007. In these stores, we will try to display as many products as we can.” Apart from that, Samsung is currently running 85 brand shops and has already converted 25 per cent of these brand shops into IT corners. 

 

Secondly , Samsung is going to focus on Specialty Stores like Chroma, which will provide a platform for the customer to choose a variety of products. Thirdly, Samsung is in discussions with the vendors who are in shop-n-shop business. Here, the customers can come and can have hands-on feel of the product and experience and then he can select the products that suit them. 

 

Fourthly, the company is focussing on its printing business. From 2004 to 2006, Samsung has added 30 to 40 per cent number of printers in its product portfolio. Today, Samsung carries a full gamut of laser printers, both in the mono and laser categories. In the Laser printer category, Samsung is growing at a CAGR of 43 per cent year on year.

 

Apart from that, Samsung is very much aggressive on the Laser printer front. Towards strengthening its products on the security and document management front, the company has also tied up with many software vendors. One of these alliances is with IBM, wherein IBM takes the outsourced case of a customer and then Samsung gives them support through its product portfolio. Speaking on this front, Sanjay says, “We are also in discussions with various people who gives a software package which can help us to add extra features in our printers.” 

 

Samsung is equivocally focussing on Digital lifestyle products – Digital Camera and Digital Camcorder and is looking around 70-per cent growth rate. Speaking about lifestyle products, Sanjay says,–“As we are offering these products at attractive prices along with warranty, and this is the reason why we are witnessing shifting of market towards organized sector. We also do a lot of R&D behind our lifestyle products.” 

 

Today, in the digital lifestyle products space, Samsung holds patented technologies in the space of display and optical drive. Since many companies who are coming with new digital lifestyle products are today looking for vendors who hold ownership for technology development. In this space, Samsung helps such companies in the development of their products with the synergy of its R&D team. According to Sanjay, about two or three years back, Samsung used to do a lot of OEM in the digital lifestyle product categories but later on the company decided to develop the products under the Samsung brand. Today, Samsung Digital lifestyle products are gaining popularity among the consumers – all because of innovative features, quality and affordability. 

 

The channel partners have always played a key role in he development of Samsung business in India. Currently, Samsung follows three tiers of partner models for its IT division. In the first tier model comes the distributors – Redington, Ingram, eSys, Savex and Neoteric. The second tier of Samsung is called Samsung elite star partners, who are more than 300. These partners, in turn, go and sell to System Integrators, who number around 12,000. Commenting on this, Sanjay says, “It is a very quite healthy model that fulfils all our requirements. Our focus is to have more partners and end-user demand generation activity. We ensure that when the products are launched then the end-user must be educated about the products.” 

 

Today, the biggest challenge that Samsung is confronting is of parallel imports of toners, LCDs, HDDs, printers, etc. by the channel community. The company has taken a number of initiatives to put a tab on parallel imports. Samsung has also initiated legal action under the trademark law against distributors and sellers of “gray market” versions of its products. Speaking about the parallel importing of Samsung products, Sanjay says, “Our basic aim is not to penalize the people involved in this sort of business. We just want to educate our partners and pass a message that this sort of unauthorized parallel trading is not healthy for their business.” 

 

In the end… 

Through a solid product roadmap, combined research and development efforts and bold new promotional activities, including aggressive marketing and inventive advertisement campaigns, Samsung is surely going to boost its brand recognition and successfully promote the company’s value across all verticals. 

 

Samsung’s Colour Laser Printer range comprises of the entry-level CLP300 that has just been introduced and in the mid-range categories, we have CLP 510, CLP 510N, CLP 600 and CLP 600N.In the Mono laser category, we have three Printers – ML 1610, ML 2010 and ML 2570, which carry a price range of Rs.5,500/- to Rs.9,500/-. We have recently introduced four new feature-rich Network Laser printers in the Indian market – ML-2571N, ML-3051ND, ML- 4551N and CLP-600N. With the introduction of the new range of Network Laser printers, we now have seven Network Laser printers in its product portfolio, priced in the range of Rs.12,990/- to Rs.58,990/-. We have nine Multi Function Printers in our lineup, priced in the range of Rs.7,800/- to Rs.80,000/. 

We are positioned against competition on the strength of our product range, features and competitive pricing. For example, our recently introduced Network Laser Printers – ML-2571N, ML-3051ND, ML- 4551N and CLP-600N–– come with differentiated and best in range features: Std PS3, Fast processors (400 MHz), High Memory capacities, Best-in-Class Duty cycles, Toner Save button, lowest running cost and lowest total cost of ownership.The CLP-300, which we have just launched, is the smallest colour laser printer, featuring a compact footprint of 15.4" w x 13.5" d x 10.4" h and weighing only 30 pounds. The CLP-300, priced very competitively at Rs.15,990/-, is not only compact in size, but also features easy-to-install toner bottles, instead of larger unwieldy cartridges, allowing for a footprint small enough to fit on almost any desk. This stylishly designed two-tone printer delivers beautiful colour prints along with quieter operati on with the same exclusive NO NOIS print engine that is available in Samsung’s high-end color laser printers.

 

The home customer can derive benefit from Samsung’s best-in-class features, competitive pricing and the onsite service that we provide. 

 

No, we are not running any finance scheme at present. 

 

We have Neoteric and Redington as National Distributors for Colour Laser Printers and Mono Lasers and Regional Distributors for our Network Printers and MFPs.

 

The Samsung’s product range and the profitability of the business is the plus point for the channel to sell Samsung’s printers.What kind of marketing activities you are focussing on?We are launching a full-fledged campaign for our CLP 300 Colour printers in trade and regional media. We are also focussing on POP and Shop Display for our Colour Laser Printers.

 

We are looking at entering the retail channel with our products .We are also looking at setting up our first IT Brand Store in the country in December this year. 

 

In Mono Laser Printers, it is ML 1610, while in the case of Colour Laser Printers, it is CLP 510. 

 

We provide after-sales service to our printer customers through 125 Service Points located all over the country. We offer differentiated service in terms of onsite service and customers can avail technical support through our Service Helpline No. 30308282. All our printers come with one-year service warranty.You are targeting a growth of 100 per cent. 

 

We are in the process of strengthening our channel for our printer business and this year we have already doubled the stockist partners from 80 to 150. We are also increasing our channel coverage by going to the B&C class towns to grow our volumes. We are also building an enterprise sales team to grow our Corporate Business and have now 11 dedicated personnel for this business. The contribution from Corporate Sales to our printer business currently stands at 15 per cent, and we expect it to double by next year.