Japanese firms begin second innings in India

Sony, Hitachi and JVC to tap the Rs 25,000-cr electronics market.

Bullish on the Indian market, Japanese companies dealing in consumer durables are all set to strengthen their presence in India by targeting niche categories and expanding their reach to tier-2 markets.

The Rs 25,000-crore consumer durables market in India is currently dominated by Korean companies "" LG and Samsung.

Takakiyo Fujita, general manager (marketing), Sony India, says: "The past few years have been extremely exciting and important for Sony in India. With a change in strategy, Sony has captured over a 15 per cent market share in the consumer electronics industry as well as tripled its turnover to reach $500 million last year. We plan to achieve our target of $1 billion by 2009."

Victor Company of Japan (JVC), the latest to enter the India market, has finalised a deal with air-conditioning major Fedders Lloyd Corporation Ltd to sell JVC products in the country. An initial investment of $30 million has been made for the same and the company expects to do sales worth $200 million in the next two years. On his recent visit to India, Kunihiko Sato, president, Victor Company of Japan (JVC), had said that with the increase in income levels in the country, the time was just right to enter the Indian market.

Another company which is betting big on the Indian market is Hitachi. Sharing Hitachi's future plans, Tarun Jain, country head, Hitachi Home Electronics Asia (S) Pte Ltd (HHES), says, "We plan to expand in tier-2 cities in a focused manner and aim at a 35 per cent increase in our retail outlets, a 65 per cent increase in the number of Hitachi exclusive galleries "" Hitachi Experience Zone, and a 35 per cent expansion in the service network".

The company, which is already an established player in the Indian LCD projector market, has tied up with HCL for distribution of its projectors.

Hitachi hopes to increase its market share from 4 per cent to 10 per cent in the LCD TV category and from 18 per cent to 20 per cent in the plasma category this year. It hopes to achieve this by way of reducing panel thickness.

"We are bringing the world's slimmest (19mm) LCD television to Indian consumers," says Tadashi Nishiuchi, MD, HHES.

Pioneer Corporation, on the other hand, is targeting the Indian in-car entertainment market and plans to sell about 200,000 units of a range of products, including audio units, amplifiers and speakers, in 2008.

Unlike the mass-oriented brands, which currently dominate the consumer durables space in India, the Japanese firms are focusing on better technology and targeting the high income group.

Sony, for example, is introducing the latest technologies in the Indian market "" from high definition to Blu-ray. And to make these technologies more accessible, the company is planning an expansion of its retail network and exclusive designated brand stores, under the name Sony World.

JVC, on the other hand, plans to establish itself as a specialist brand in entertainment products. Hitachi is contemplating several marketing communications and distribution channel initiatives to reinforce the premium/niche positioning. "The focus is going to be on the high-end market," Jain says.