Samsung shakes off the blues

Firm ends with higher marketshares in premium category.

Aided by the booming mobile-phone business in the country and the company's focus on high-technology products, Samsung has emerged as the fastest growing umbrella durables-manufacturer in India.

According to sources, the company has grown its turnover by nearly 30 per cent this year, significantly lowering the distance between itself and the market leader LG.

The company, with its turnover likely to touch the Rs 6,300 crore this year, is also likely to leave the Videocon group behind as the second biggest durables brand in India.

The company, which had nearly half of its Rs 4,900 crore revenue last year coming from the GSM and IT units, is reportedly on its way to meeting its growth target of 30 per cent, despite the slump in the consumer electronics market.

In comparison, LG, dependent of the electronics and appliances segment for nearly 80 per cent of its revenue, had to be content with a 15 per cent growth against a target of 35.

As a result, the difference in turnover between the two companies are likely to go down from Rs 1,600 crore last year to 1,200 crore during this one.

"Whereas for most of the players in the industry, the colour TV and appliance sales stagnated or even shrunk this year, Samsung is the only player which has managed to grow its electronics and appliances at nearly 30 per cent this year," pointed out an industry executive. "Except for LG and Sony, most of the others players have been worried about just keeping up last years sales volumes."

Though refusing to confirm the numbers, Samsung's Deputy MD Ravinder Zutshi agreed that the company's strategy of concentrating on the premium segments in each product category helped in beating the blues this year.

The increase in the Indian consumers appetite for premium products seems to have helped Samsung, which has been trying to position itself as a premium and high-tech brand.

For example, more than 80 per cent of the company's revenues from CTV sales now come from flat-TV models, up from just 50 per cent last year. It also has a 23 per cent market share in the flat segment compared to a mere 7 per cent in the curved one.

In refrigerators too, the company's thrust on Samsung the higher-end frost-free models seems to have paid off with the brand accounting for a share of 21 percent in the segment against a mere 14 per cent in the 'direct cool' segment.

Similarly in washing machines, Samsung has a higher presence, 21.5 per cent, in the fully automatic (top load) segment compared to the semi automatic and manual wash segments.

While Samsung has always been perceived as a higher end brand, Zutshi believes last year's gains have come mainly through better communication with the consumers.

"Over the last year, we have focussed on improving our retail network, especially in training our sales and dealer staff on the features of our hi-end products. Soon, we will increase the number of our company-shops to 80 all our the country," he said.