MARKETING PLAN FOR-Plastic Plug & Socket

L&T –ELECTRICAL & AUTOMATION

Submittedby: RahulRaman

Contents

About the company :..................................................................................................................................... 4Terms of reference:................................................................................................................................ 5

Executive summary ...................................................................................................................................... 5

Objective:....................................................................................................................................................... 5

Scope:................................................................................................................................................... 6

Source of data: ..................................................................................................................................... 6

Reasearch method................................................................................................................................ 6

Sampling metod .............................................................................................................................................7

Background:........................................................................................................................................... 7

Significance of the project: ................................................................................................................... 8

Market assessment:............................................................................................................................. 8

Table:…………………………….. ....................................................................................................................... 9

Pie chart……………:................................................................................................................................... 10

Histogram………….: ................................................................................................................................... 11

Pie chart………………………………:............................................................................................................ 12

channel of purchasing: ................................................................................................................. 13

Disribution of customers: ................................................................................................................. 14

Continue of above............................................................................................................... 15

Competitor analysis:................................................................................................................................. 16

Continue of the above: ....................................................................................................... 17

Market Assessment by using various marketing tools............................................................................. 18Positioning: ........................................................................................................................................... 19

Strategic Thrust........................................................................................................................................ 20

BCG Matrix: ......................................................................................................................................... 21

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MARKETING RESEARCH

CORE Strategy........................................................................................................................................... 22

Marketing Mix: ........................................................................................................................................... 22

Continue of the above: ............................................................................................................................ 23

Price of competitors: ........................................................................................................................ 24

Certain important things about the market: ................................................................................... 25

Insights from the market: ................................................................................................................... 26

Suggestions: ....................................................................................................................................... 27

Correlation: ............................................................................................................................................ 28

Rules: .......................................................................................................................................................... 29

Analysis:................................................................................................................................................. 30..

Recommendation:................................................................................................................................. 31..

Bibliography: ......................................................................................................................................... 32

Continue……………………: ................................................................................................................. 33

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MARKETING RESEARCH About the Company

Larsen & Toubro is a major technology, engineering, construction, manufacturing and financial services conglomerate, with global operations. L&T addresses critical needs in key sectors - Hydrocarbon, Infrastructure, Power, Process Industries and Defense - for customers in over 30 countries around the world.

L&T is engaged in core, high impact sectors of the economy and our integrated capabilities span the entire spectrum of ‘design to deliver’. With over 7 decades of a strong, customer focused approach and a continuous quest for world-class quality, we have unmatched expertise across Technology, Engineering, Construction, Infrastructure Projects and Manufacturing, and maintain a leadership in all our major lines of business.

Every aspect of L&T's businesses is characterised by professionalism and high standards of corporate governance. Sustainability is embedded into our long-term strategy for growth.

The Company’s manufacturing footprint extends across eight countries in addition to India. L&T has several international offices and a supply chain that extends around the globe.

L&T Electrical and Automation

Electrical & Automation is a major business portfolio of Larsen & Toubro. The business basket of Electrical & Automation (E&A) contains low and medium voltage switchgear products, electrical systems, energy meters and automation solutions. Its products and solutions cater to industry, utility, building & home, infrastructure and agriculture segments.

The E&A business comprises two Strategic Business Groups (SBGs) – Products SBG and Projects SBG and offers a wide range of low and medium voltage switchgear, electrical systems, marine switchgear, industrial and building automation solutions, energy management systems and metering solutions. Its products and solutions cater to a variety of segments like industries, utilities, infrastructure, building and agriculture.

L&T’s E&A business offers products and systems solutions for control, regulation and monitoring - planning, designing, engineering and implementing drive controls, automation and UPS related projects from concept to commissioning. Our systems solutions cover a host of industry verticals like cement, metals, paper, oil & gas, water, power, food processing, etc.

A major strength of L&T is its in-house design and development centre for switchgear as well as tooling facility that designs and manufactures a wide range of high precision tools, a pre-requisite for high quality products.

Additionally, the company has six Switchgear Training Centres (STCs) at Pune, Lucknow, Coonoor, Vadodara, Delhi and Kolkata promote good electrical practices in the industry by conducting courses.

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MARKETING RESEARCHThe manufacturing operations of our businesses is located at Navi Mumbai (Mahape & Rabale), Ahmednagar, Vadodara, Coimbatore and Mysore in India as well as in Saudi Arabia, UAE (Jabel Ali, Dubai), Malaysia, Indonesia, Australia and the UK.

T ER M S OF REF E RE N C E : Larsen & Turbo (L&T) operates as leading Engineering, construction and manufacturing company based in India. It has six divisions namely Engineering & Construction Projects, Heavy engineering, Construction, Electrical & Automation, Machinery & industrial Products and IT Services. This report concentrates on the Switchgear(Plug &Socket) section of E&A division. This report would be formulating a marketing plan for Industrial Plug & Socket of L&T which could be potentially launched in the Indian market.

E X E C U T I V E S U MM A R Y : The marketing plan analyses the Plug & Socket market in various sectors in Chennai and identifies key growth Opportunities, potential market & feasible price range for the product to be launched for L&T.

The analyses are done in the following way:

Visited the Chennai market based on different segments like industries,metro rail,hotels malls,tech parks,hospitals and the local market of switchgear products. Made a questionnaire which was filled by the above mentioned industries and by this

analyzing the market structure of the competitors and substitutes. Current marketing objectives, competitive advantage, core competence and positioning

of the product using various marketing tools. Putting these information in SPSS tool to get the abject market share and the price that

customer willing to pay. Putting it together under the SWOT analysis.

In order to gain growth and market share, following strategies are recommended:

Pricing strategy – special prices for projects, bundling of products to create better prices.

A manger to liaison between operating divisions of L&T to create synergy and generate internal business.

To generate loyalty among customers thro schemes and giving turn over discounts etc.

Objective of internship

The project that company gave to me was to check the ‘Feasibility of Plugs and Sockets’. The project is very interesting not only from MBA point of view but also from the point of view of personal growth and development. The topics that I need to cover under this project are as follow:-

Current market of Plugs and Sockets in Chennai (Market Research). Study about competitors offerings in the market. Study about the main consumers of the product.

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MARKETING RESEARCH Whether company should add this product in its portfolio. Channel of distribution.

Scope of the study:

1. Analysis of all segments of market with the pricing of the competitors in the market.2. Detailed analytics of the various factors.3. Process documentation – of steps followed by the other companies, the companies using the

product and the available.4. The technical advancement in the plug & socket.

Technological:

Technology is becoming more advanced everyday and intelligent MCC and devices introduced in the market and the more electrical devices are getting upgraded to Electronic devices. The old technology is eradicated i.e Fuse is been replaced by the switching (Tripping) devices such as the MCB, MCCB etc. Steve Lane who invented the principle of the modern day magnetic actuators mentions “New designs of switchgear will evolve, designed from scratch with every component as simple and reliable as possible to capitalise on the potential of the magnetic actuator mechanism to be as trouble free as the latest interrupter technology”. World energy consumption has risen by 45% since 1980 and it is projected to increase by another 70% by 2030. (Schneiderelectric.com). The simple and powerful solution is intelligent energy efficiency.So there is a huge scope for L&T to enter in this segment as it is already in the switchgear market.

Source of dataRESEARCH METHOD

The method carried out is descriptive research which helps the researcher to extract and understand the data and the main characteristics that are required to define the objective of the study. It is conducted to understand the requirements of hotels, hospitals, malls, retailers, stockists, factories in Chennai in terms of their daily business needs. It will also show us the potential of the market. It will help us to know the gap in the segment requirement .

DATA COLLECTION METHODS

Primary Source: Personal InterviewPersonal Interview method was used to collect the data. Structured type of interview was used. The authenticity of the data collected is high. As the respondents were asked questions at the time of interview their responses were recorded on the questionnaire. Regarding the daily requirements of the business, usually the company admin’s were the respondents.

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MARKETING RESEARCH

SAMPLING DESIGN

Target Population- The respondents are the people who make purchase decisions regarding the daily requirements of the business, usually the company admin’s were the respondents. Sampling Method For the study, hotels, hospitals, malls, retailers, stockists, factories in Chennai located within the radius of 20-25 km and perungudi was marked and the metro rail project CMRL response was taken on poonamallee high road,kandanchavdi,govindappa naichan in perrys corner,velacherry was taken.Sampling Size Totally 50 responses are taken for this project. All the respondents were the admin’s of hotels, hospitals, malls, retailers, stockists, factories .Out of which 40 were identified as key account customers

Primary source: Through various meetings with the maintenance departments of various companies. Questionnaires being filled with various companies. Raw dump of various products got from the local market of switchgear and the pricing part.

Limitations: Some of the companies are not giving pricing information that they are paying. Not all the indicators directly affect the annual requirement. KRA for the plug & socket is very limited on the internet as there are very less information

gathered from secondary research. TASKS ASSIGNED

To provide the company with an information of annual demand (approx) of the product. Help the company in making the decision of whether they should add this product in their

portfolio or not. If ‘No’ then providing the company with reason of doing so. If ‘Yes’ then helping the company to determine the channel of distribution, Target Segment

and pricing of the product.

Background

Plug and Socket is one of the major electrical equipment that is used in many Government projects, Industries, Hotels, Hospitals and Restraunts. The project was carried in Chennai city known as the centre of south India. With large number of Industries, Hotels, Hospitals and most important the upcoming metro makes this as the best location for analysing potential and requirement.

Industrial plugs and sockets provide a connection to the electrical mains rated at higher voltages and currents than household plugs and sockets. They are generally used with high currents, or when protection from environmental hazards is required. Industrial outlets may have weatherproof covers, waterproofing sleeves, or may be interlocked with a switch to prevent accidental

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MARKETING RESEARCHdisconnection of an energized plug. Some types of connectors are approved for hazardous areas such as coal mines or petrochemical plants, where flammable gas may be present.

Almost all three-phase power plugs have an earth (ground) connection, but may not have a neutral because three-phase loads such as motors do not need the neutral.

SIGNIFICANCE OF THE PROJECT

This study will help the company to understand the potential, requirements and their value proposition in the field of Industrial plugs and socket. It will help them to alter their policies according to the requirement of the market. As the focus is on key account customers it will help to understand their special requirements and drive more sales. The same can also be used to formulate policies and strategies to expand the customer base in the market.

Market assessment after using the SPSS tools:

Frequency:

Statistics

which company

plug&socket installed in

your company

what is the price that you

are paying for current plug&

socket

N Valid 50 50

Missing 1 1

Mean 4.7800 4.8200

Median 5.0000 5.0000

Mode 6.00a 6.00

Std. Deviation 1.88755 1.28873

Variance 3.563 1.661

Skewness -.522 -.663

Std. Error of Skewness .337 .337

Percentiles 25 4.0000 4.0000

50 5.0000 5.0000

75 6.0000 6.0000

a. Multiple modes exist. The smallest value is shown

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MARKETING RESEARCH

Which company plug&socket installed in your company?

which company plug&socket installed in your company

Frequency Percent Valid Percent

Cumulative

Percent

Valid schneider 2 3.9 4.0 4.0

legrand 9 17.6 18.0 22.0

Neptune Bals 9 17.6 18.0 40.0

ABB 8 15.7 16.0 56.0

Siemens 11 21.6 22.0 78.0

others 11 21.6 22.0 100.0

Total 50 98.0 100.0

Missing System 1 2.0

Total 51 100.0

From the above table we can clearly see that the Siemens is the market leader as many companies are using different products of which one of their plug & socket are from Siemens.In the table the others means the local product like mennekes and the Chinese products.Legrand and Neptune bals are with same percentage,Schneider market share is very less here in Chennai market.ABB is kind of present in quite good percentage.

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MARKETING RESEARCHThis we can see in the pie chart

So from this pie-chart it is evident the market scenario in plug and socket market.

By the graphical representation we can easily see this in the following graph:

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MARKETING RESEARCH

Now the second question was about the feasible price range in which company should launch the product.After using the tool we got the following result:

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what is the price that you are paying for current plug& socket

Frequency Percent Valid Percent

Cumulative

Percent

Valid 200-250 2 3.9 4.0 4.0

350-450 9 17.6 18.0 22.0

450-550 7 13.7 14.0 36.0

550-650 10 19.6 20.0 56.0

650 above 22 43.1 44.0 100.0

Total 50 98.0 100.0

Missing System 1 2.0

Total 51 100.0

MARKETING RESEARCHNow from this table it is evident that 43% of the customers are paying above 650 rupees which includes the heavy users like the High end industries,Chennai Metro,Railways and the brand conscious customers who doesn’t care much about the pricing and all other stuffs.After that the 550-650 range it also constitutes of medium industries.This includes the hospitals and the plastic making industries and the mid range industries.The third highest is the 350-450 range as it is the shopping malls and the tech parks.They use very less number of industrial plug & socket as mostly they are using the general ones.And after that the 450-550 range this generally given by those who are using the 32A-3pins as it is the cheaper as compared to other products.Last one the lowest range is given by the low grade industries and the households who doesn’t use give high loads and thinks it as any ordinary product.So, generally the feasible price range is 650 above but I would suggest the company should come up with segment wise product like low,mid and high ranges.And they should offer discount as in the visiting time I have seen people going for discount very easily and if L&T kind of big name come with discount and segment wise product people will definetly go for it.We can see from the piechart also:

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MARKETING RESEARCHNow next is the channel of purchasing the product:

what is the channel of purchasing plug & socket?

Frequency Percent Valid Percent

Cumulative

Percent

Valid direct from company 2 3.9 4.0 4.0

stockiest/distributor 23 45.1 46.0 50.0

wholesaler 17 33.3 34.0 84.0

retailer 8 15.7 16.0 100.0

Total 50 98.0 100.0

Missing System 1 2.0

Total 51 100.0

From the above figure we can say that the best channel to sell the product through

stockiest/distributor and the big names are buying through this channel.Then comes the wholesaler

with 33.3% which is also a good channel to sell and then comes the retailer and in the last direct

from companies.So I would suggest that L&T should go with stockiest

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Statistics

what is the channel of purchasing plug & socket?

N Valid 50

Missing 1

Mean 2.6200

Median 2.5000

Mode 2.00

Std. Deviation .80534

Variance .649

Skewness .324

Std. Error of Skewness .337

Percentiles 25 2.0000

50 2.5000

75 3.0000

MARKETING RESEARCHAnd the retailer. L&T should ensure that the network should be present in most places.

We can see this through histogram also:

Disribution of customers:

Serial No. Type Comments

1. OEM – Original equipment

manufacturers

These are the heavy users of

industrial plug & socket. OEMs

buy the switchgear to integrate

into their design; equipments

they manufacture. They are one

of the biggest consumers of

switchgears and they are the

biggest assets for repeat orders

in the market. Once they have

found that the switchgear is a fit

and forget experience in their

equipments i.e. application they

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MARKETING RESEARCH

generally continue to buy

2. Panel Builders They build Panels with the

switchgear and control gear

based on logic and as per the

functions they require. They

work on different projects from

various firms and they too buy

Variety of Switchgear in Bulk

case to case.

3. System IntegratorsSI is basically appointed by the Switchgear

companies as their

representatives who does work

on the company’s behalf as the

capacity of the mother

company gets piled. They work

on small tenders and the

Switchgear Companies

themselves give tasks to these

integrators to get the job done

at faster pace.

4. Electrical DealersThe Dealers generally are located all across thecountry and do counter sales. They hold the stock for the Switchgear Companies and sell when replacements, Spares else products are required r locally.

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MARKETING RESEARCH

5. Key accounts/ Projects This is basically a customized

product specifically designed

for that particular company or a

general product. A rate contract

is signed for the same based on

the annual quantity required

which is usually scheduled.

Competitors Analysis Schneider Electric

Schneider Electric, the global specialist in energy management and automation with operations in over 100 countries, leverages its portfolio to help customers make their ecosystem safe, reliable, efficient, and sustainable.As a leader in energy management and automation, the vision of Schneider Electric is to help its customers achieve more with less resources in a more connected, distributed and smart world and where the need for energy will continue to increase. Schneider Electric strives to help its customers achieve the most efficient and sustainable use of their resources, assets, processes and infrastructures with innovative technologies, solutions and services.

ABBABB is a global leader in power and automation technologies. Based in Zurich, Switzerland, the company employs about 140,000 people and operates in approximately 100 countries. The firm’s shares are traded on the stock exchanges of Zurich, Stockholm and New York.

ABB’s business is comprised of five divisions that are in turn organized in relation to the customers and industries they serve.

The group is particularly proud of its record for innovation - widely recognized through countless awards and scientific accolades. Many of the technologies we take for granted today, from ultra efficient high-voltage direct current power transmission to a revolutionary approach to ship propulsion, were developed or commercialized by ABB.

Today ABB is the largest supplier of industrial motors and drives, the largest provider of generators to the wind industry and the largest supplier of power grids in the world.

Siemens

Siemens AG is a German multinational conglomerate company headquartered in Berlin and Munich. It is the largest engineering company in Europe. The principal divisions of the company are Industry, Energy, Healthcare, andInfrastructure & Cities, which represent the

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MARKETING RESEARCHmain activities of the company. The company is a prominent maker of medical diagnostics equipment and its medical health-care division, which generates about 12 percent of the company's total sales, is its second-most profitable unit, after the industrial automation division.[2]

Siemens and its subsidiaries employ approximately 343,000 people worldwide and reported global revenue of around €71.9 billion in 2014 according to their annual report.

Teknic

Teknic was established in 1971 as a small plastic- processing unit, supplying engineering plastic components to PHILIPS India. Ever since, the company has developed expertise in many facilities.Having developed an in-House expertise in processing of Plastic engineering components. We decded in 1978,to enter into the field of electrical/ electronic controlgear productd. Despite the fact that the multinational companies like Larsen& Toubro, Schneider electric, ABB were therein the market with their products, the company came up in the market and today they are one of the leading players in the market. The company also manufacture electro- mechanical devices, such as Circuit Breakers for Equipment (CBE), Micro Switches, Slide Switches and Terminals for application in all kinds of Electrical and Electronic Circuits.The company has followed a careful marketing policy. Personal visits to customers all over India to demonstrate the technical features of our products, systematic advertising, participation in trade fairs have enabled us to popularize our products amongst a large cross section of clientele in India and all over the world.

Legrand

Legrand is a French industrial group historically based in Limoges in the Limousin region. In terms of sales, the firm is a world leader in products and systems for electrical installations and information networks.

In 2011, Legrand was the largest globally for switches and sockets, with 20% of the global market, and it was also globally largest in cable management (15% of the global market), generating 75% of its turnover internationally. The company is market leader in at least one of its main areas of business in 27 countries. It ranks second in India for sales of switches and sockets, and ranks first for miniature circuit breakers (MCBs) and distribution boards (DBs).

The Group is also expanding its product range with regards to sustainable development and energy saving technologies, and also has developed new products for photovoltaic installations and lighting control.

NEPTUNE BALS

The Balscompany was established in Germany over 50 years ago. It manufactures an extensive range of high quality indus- trial plugs and sockets and is proud to serve world markets.The headquarter is located in Kirchhundem-Albaum, North Rhine Westphalia. The company expanded in recent years by opening a second plant in East-Germany, Freiwalde, in the district of Brandenburg.

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MARKETING RESEARCH

Design and DevelopmentThe multiple requirements of the world markets regarding the design and function of industrial plugs and sockets have been continouslyanalyzed by Bals. Innovation is created within their own design and tool making departments,"Application Creates Design" is the motivation for their designers and engineers, which has been translated into many unique patented products.Their "know how" stands for the unrivalled quality of safe use.

Market Assessment by using various marketing tools

A strong Brand name:After assessing the market I found out that a strong brand name is needed for the customers

to buy the product.Many customers that are heavy users like big industries are mainly relies on the company name as it is their part of business policy.Cost Leadership:In this section of brand name two to three companies are there , so if any company wants to enter in this segment less cost among the competitor will be required.Means cost leadership will be required.Porters five:

Degree of competitive pressure-Industry rivalry:This includes the rivalry among the same set of companies in the same market segment.It always causes the competition by offering same kind of product in the market.Threat of new entrants and substitute products are always there as many companies are

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MARKETING RESEARCHcoming in this segment with new technological advancements will cause competitive pressure.

Bargaining power of customers& suppliers are a major thing to ponder about as the mid range and smaller range companies are offering a bargain price which may cause the customer base to shift.

Market cap customer base Industry apprehension Price0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

SiemensABBNeptue balsScheinderLocal&chinese

The market share of different companies on various aspectsCurrent position of companies in Plug & socket market

High price

Wide product Range Narrow product range

Low price

Siemens

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MARKETING RESEARCH

ABB

Neptune bals

Scheinder

Legrand

Mennkes

S t r a teg i c T h r u st:

Ma r k e t pene t r a t i on :

It is proposed that the company concentrates on its lost customers. L&T lost many of its customers because of the inception of many competitors. They should strongly focus on the lost customers to revamp its sales. As a strategy for its existing customers it should introduce the loyalty schemes and turn over discounts.By entering in this segment company would gain its lost customers.Ma r k e t de v e l op me n t:

It is proposed that the company markets its existing products at the same price for existing market. The new market they need to concentrate is the Plug & socket market as they are new in this market. They need to have attractive prices which through which they can capitalize on the market share.

P r odu c t D e v e l op me n t:

Product development is a growth strategy where L&T has to aim new products into existing markets.they need to bring advanced product into the market as they should keep in mind the competitors.

D iv e r s i f i c a t i on :

The Company has realised its need to diversification and has indeed done over the past years but limited to the engineering for Industries. L&T’s main source of income is through the ECC division which accounts for close to 70% of its revenues which is a concern. It has concentrated sales which needs to look on unto other divisions and should find ways to explore to diversify (L&T.com)

S t r a teg i c O b j e c t iv e s:

The Switchgear Market is in the early stages of Maturity. Hence the Market strategy is to be based sustained Marketing activities. The below BCG matrix will help us draw further inferences of the strategy we need to follow.

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MARKETING RESEARCH

From Portfolio analysisL&T ‘s contactors, relays, Motor starters and MCCB are the bread and butter of the company. These products are quite well established in the market and are generating cash flow for the company. The Star Product for L&T is its Agriculture Motor Starters in which L&T enjoys 40% of the total Market share and

has clearly out performed against competition. The cash generated

needs to be further invested into the growth of other different products.As clearly seen the Question mark is the plug & socket market which are still to achieve in the market share. This needs a lot of attention as this definitely can become as the star products as the competition is only against ABB and Siemens. Hence the strategic objective is to concentrate on the medium voltage switchgears.

C ORE S T R A T E G Y:

Organizationalsegmentation

Macro segmentation

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STARS???? The plug & socket

market

CASH COWSLOW VOLTAGE SWITCHGEAR

CONTACTORS,RELAYSDOGS

Market Growth Rate

Relative market share

MARKETING RESEARCH

Industry

Micro segmentation

Choice criteria (Price)

(Source: Jobber 2010)

The Macro Segmentation has to be on the industry basis.

The need is basically to micro segment which will enable to define the target markets and the customers which when concentrated will yield good numbers as they same a particular choice criteria of price or similar usage.

At the same time there should be a Manger just to liaison between different operating units because they generate voluminous business.

Concentrate on Plug & socket market to maximize the Market share.

Market mix Strategy:

1.Product- As discussed about the new Medium voltage products alongside High voltage

switchgear products have to be developed, certified and positioned. L&T should be able to offer Low voltage, medium and high voltage switchgear as a package.

Product customization is as well expected with certain customers preferring that and it will create loyalty business and constant volumes at fixed price over period.

The product comprises of plug & socket of plastic or metal.

2.Promotion- Direct mailers to the lost customers for feedback have

to take corrective action Plug & socket also indulges among the residential market it has to be promoted

in Print and in Mass media.

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MARKETING RESEARCH Since most of the industries hires electrical consultant they play a important role

in making decisions. Hence designated People should work closely with them and promote the Products.

The online website has to have still a lot of details pertaining to the solutions that can be offered and it is the most important tool for spreading awareness amongst customers.

3.Place- As seen already the company has a wide range of dealers who market the product.

The new challenge is to see for the expert dealers in Medium voltage and high voltage switchgear products.

As explained above the target markets needs to change and greater emphasis is to be given on these areas.

4.Price-

Volume based prices. Competitors are also willing to give higher discounts to their dealers and customers when faced with bigger volumes. Hence case to case volume based pricing to be followed..

Bundling up strategy is required to be taken up. As far as the panel builders and system houses are concerned they buy products for specific projects where a lot of line items will be used and hence

the price offered should be bundled to remain competitive. Loyalty schemes and turn over discount to motivate and retain customers

Pricing Strategy

Definition

Penetration Pricing

Here the organisation sets a low price to increase sales and market share. Once market share has been captured the firm may well then increase their price.

Competition Pricing

Setting a price in comparison with competitors. Really a firm has three options and these are to price lower, price the same or price higher

Premium Pricing

The price set is high to reflect the exclusiveness of the product.

Cost Based Pricing

The firms takes into account the cost of production and distribution, they then decide on a mark up which they would like for profit to come to their final pricing decision.

Value Pricing Value based pricing is simply based the value that a customer will be getting by making use of the product.

Captive Pricing Lock the customer by selling the system cheap, and then profit by selling

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MARKETING RESEARCH high margin consumables

Price of competitors:-

Certain important things about the market:The power of buyers:a)Buyers power in the market can be termed as moderate to high.b)Buyers are price sensitive and have various options because of high competition.c)Major and repeated buyers tend to have high negotiating power.

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MARKETING RESEARCHd)However sometimes buyers cannot make independent decisions.They are bound to buy certain company’s product,which is recommended and insisted by the consultants else recommended by the ultimate user specification.The threat of new entrants:a)The threat of new entrants is moderate.b)The entry barrier is not high but the switchgear industry entering the maturity stage,some more MNC players are expected.c)It is difficult to attain economies of scale and there are plenty of small players in low voltage market.The power of competitors:a)competition in the market can be termed as high as there are plenty of players who want to have a market share.b)ABB has wide range of product and it is well established.c)Siemens is known for its quality products have a wide range of consumer base.d)Neptune bals treated as best known name product and has a wide market base.e)The local ones & the Chinese products are the tough competitor in the small market segment.The threat of substitutes:a)the power of substitutes is low.b)Duplicates or look-alikes are the biggest threat in the market which still remains a challenge.c)There are no other substitutes for the electromechanical product unless companies come up with electronically advanced products.Work done in the research:-

Finished initial dusting of switchgear market in Chennai local area. Visited some top organisations like CMRL-Chennai metro rail limited, Hilton hotel &many

local companies. Also visited in several residential complexes and apartments. Also did secondary research like studied various market research report of these target

market. Visited the IT tech parks from smaller to bigger ones. It includes S P INFOCITY,RMZ MILLENIA,KG 360,IITM RESEARCH,TIDEL

PARK,ASENDAS,PRINCE IFO CITY,RAMANUJAN IT CITY,COGNIZANT OFFICE,HCL and many more smaller companies.

Also visited smaller shopping marts like MAXX,HI-STYLE etc. Also did comparative analysis based on the usage of the different brands. Visited the local market of switchgear products in Chennai. It is situated in Govindappa naichen in perrys corner. The visiting includes the local product market and the various distributors. Also visited small scale industry. Also did comparative analysis based on the selling & availability of the different brands. Visited the industries from medium level to high level.

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MARKETING RESEARCH It includes Andrew Yule & Co Ltd, Kumari Engineering Works, Sriram Industries,

Engineering Electronics & Generation, J K Engineering Works, Samco Engineering Co P LTD, R S Engineering Works, Uma Engineering.

The visiting includes the local production and the distribution. Also visited small scale industry. Also did comparative analysis based on different companies product used in what kind of

industries. Visited the Hospitals and some banks in Chennai . It includes Apollo hospital,prabhavati hospital,central bank of india &state bank of india

and some of their ATMs. The visiting includes the meeting with maintenance department. Also visited small scale industry.

Also did comparative analysis based on different companies product used in the hospitals. Did secondary research using various journals and the internet.

Insights from the market:-

Customers does not think much about the IP & IK ratings. They think much about the working and pricing part with quality. Quality includes the age of plug & sockets how much they long last. From reports it is obvious people goes for loose ones more than the distribution box

included. In Chennai the small companies use only the local ones like Neptune,teknic and max

electric India pvt. Bigger names customers gives emphasis on quality and delivery. They think much about the working of the product with quality. Quality includes the age of plug & sockets how much they long last. Medium sized companies emphasized mainly on delivery & after sales service of the

products. After research I found out that the tech parks doesn’t use a single company product they use

mainly anchor roma, legrand and Siemens. The shopping marts use the local brands and anchor roma also. After comparative study I found that the product accessibility matters for the buyer and not

the brand name. I got to know about the pricing & user of the product. The biggest winner in this market are the Chinese products & the local ones. The price range of these brands are varies from INR 100 to 250. There are no proper catalogue for these brands so people can bargain. The ABB,NEPTUNE BALS are selling for these 16 A-32A are selling in the range of INR

550-750. MENNEKES like brands are some mid range brands which are selling in the range of INR

325-450.

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MARKETING RESEARCH Schneider and legrand presence are there but mainly non branded are selling cause of the

low prices. The customers of the top brands are the big industries. After comparative study I found that the product accessibility matters for the buyer like

which product is popular or top seller in the market. I got to know about the price that hopitals are paying and willing to pay. The banks are using very minimal quantity of industrial Plug & socket, instead they are

using normal plug & socket. The price range they are willing to pay for industrial Plug & socket are varies from INR

350-400 The Apollo hospitals are brand conscious as they are willing to pay higher prices for

brands.

Suggestions-;

Sale Analysis

The Monthly sale analysis can be carried out onuser based reports in SAP which L&T has implemented. This will give a detailed analysis and performance report on different Products and can be matched with the previous year and planned for this year.

Customer Satisfaction

Measuring the Customers response on differentparameters such as Sales support, Product Appraisal, after sales service etc. It can be carried out every 6 months once.

New customers addedThis can be used to measure how new customers

are added month after month.

Distribution/availability

This can be carried out to see if the products arereadily available for the customers within their reach and the quantity of stocks at the dealers place which can be carried out fortnightly.

Market Share

This can be carried out 3 months once to see therelative market share and their performance.

Gross marginThe Marketing manager who is heading can perform this check to see the business is profitable as they do all major deals and special price deals.

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MARKETING RESEARCH

Correlation Table

Significanc

e values.

Annual

demand

Brand

name

quality feature discount price design

Annual

demand

1 0.666 0.890 0.074 0.003 0.079 0.000

Brand name 0.666 1 0.549 0.039 0.321 0.001 0.382

Quality 0.89 0.549 1 0.231 0.023 0.000 0.398

Feature 0.074 0.039 0.231 1 0.041 0.033 0.301

discount 0.003 0.321 0.023 0.041 1 0.235 0.010

Price 0.079 0.001 0.000 0.033 0.235 1 0.163

Design 0.000 0.382 0.398 0.301 0.010 0.163 1

Correlation table help us to understand the relation between the two variables and their significance

with respect to the sale and demand. It also helps in taking prolific decisions for the company. A

change in one variable in significance with the other variable may help to decide what action to be

taken on other related variable.

Rules

The significance value i.e “P”value should be less than 0.05 for the relation between two

variables to be significant.

Values such as 0.000,0.001 which are way smaller than 0.05 are highly significant values

where are values such as 0.03,0.04 are less significant.

Analysis-

For the company to increase the annual demand of their industrial plug and socket they

have to focus on the design of the plugs and sockets as both these variables are highly

significant(0.000), a good design can increase the demand for the products.

The annual demand is also subjected to the discount offered by the retailer to the customer,

as both these variables are highly significant(0.003),a reasonable discount by the retailer on

products can influence the buyer for buying more but it should be noticed that the discount

offered may not put the production cost high as compared to selling price.

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MARKETING RESEARCH Brand name and price are highly significant(0.000) which means that pricing of the product

has to be efficient ,if the price is high it should match the features offered then and should

not be higher than the competitor given the fact that company should look into its

production cost as well.

Quality and price are highly significant (0.000) hence a reduction in quality may bring the

price of the product down and similarly on increasing the price company should look at

increasing the quality, there should not be any compromise in the quality aspect.

The above histogram shows the level of demand of the IP number in the market, here –

1-IP-44-

2-IP-56

3-IP-65

4-IP-66

5-IP-67

Hence it can be seen that IP-44 has the highest demand among all the other variants, due to its

reasonable pricing and usage, next comes IP-66 whose demand is fairly high even though the price

is high because of the fact that it is waterproof, next is IP-65 which is also being waterproof has

descent demand.

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MARKETING RESEARCHWhich IP number

Frequency Percent Valid Percent Cumulative Percent

Valid

IP 44 17 32.7 40.5 40.5

IP 56 2 3.8 4.8 45.2

IP 65 9 17.3 21.4 66.7

IP 66 12 23.1 28.6 95.2

IP 67 2 3.8 4.8 100.0

Total 42 80.8 100.0

Missing System 10 19.2

Total 52 100.0

Following table shows the demand of IP numbers in terms of percentage, as discussed above IP-44 has highest usage percentage of 40.5% with IP-66 being the follower with 28.6%.

Further suggestions-:

First we need to place the product in the feasible price range. Means we need to segment the target market. According to which price will be set. One more thing can be done to make different products for different market. we need to make the product accessible in the market means the penetration in the local

market. The range of the product doesn’t matter,so we need to work upon the quality and long life

of the product. In this segment company should focus on the mass production and the timely service of

the product.

The product should be approachable and the market is very product sensitive, so positioning of the product is most important.

We could project the product mainly in the mid range and for high range differently. In this mid range company should focus on the mass production cause of high number of

customers in this range. As L&T has the brand name,so if it comes in the mid range customers will definitely go for

it instead of those Chinese products. we need to make the product accessible in the market means the penetration in the local

market. We could project the product mainly in the mid range and for high range differently. In this mid range company should focus on the mass production cause of high number of

customers in this range.30

MARKETING RESEARCH As L&T has the brand name,so if it comes in the mid range customers will definitely go for

it instead of those Chinese products.

31

MARKETING RESEARCHBibliography:

Larsen and Tubro Company’s Vision 2015

h t t p : / / w w w . l ar s en t o ub r o . c o m / l n t c o r p o rat e / c o m m o n / u i_t e m p la t es / H t m l C o n ta i n er.as p x ? r e s = P _CO R P _A A B T _AC O M _CVIS (accessed 20.02.2015)

Power Generation in India 2015

htt p: // www .po werm in.nic.in/ whats_new/ pdf/ ultra%20 mega%20 pro ject.pdf (Accessed21.02.2015)

Data monitor report (2015)- FDI in INDIA- Country Profile: India

h t t p : / / w w w . m ar k e t li n ei n f o .c o m/ li b ra r y / D is p lay C o n te n t.as p x ? N = 4 2 9 4 6 6 9 4 8 9

(Accessed via Metalib 21.02.2015)

Switchgear Market in India 2015, Frost and Sullivan www . e ne r g y . f r o st . c o m (accessed 21.02.2010) Switchgear Split up h t t p : / / b l o g .ta r a g a n a.c o m/p r / i nd ian-l ow -a n d- m ed ium - vo l t a g e - sw i tch g e ar - m ar ke t s -t o - r eb o un d- b y - 2 0 10 - d r i v en- b y - d e m a n d -fr om - v ar i o u s-se g m ents- s a y s-fr o s t -su l li v an - 2 6 0 2 / (Accessed on

22.02.2015)

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MARKETING RESEARCH

L&T corporate website- financials – performance analysis etc.

h t t p : / / w w w . l ar s en t o ub r o . c o m / l n t c o r p o rat e /L n T _ D W S / D o wn l o a d s.as p x ? res = P _C OR P _CI N V_AF N C_BQUT (Accessed 22.02.2015

Data monitor – L&T profile h t t p : / / w w w . m ar k e t li n ei n f o .c o m/ li b ra r y / D is p lay C o n te n t.as p x ? R = BC 1 2 8 4 3 B - 5 B D 8 - 4 9 76 - 90 C 4 - A3B 2 5 8 9 0 06 A C &N = 4 2 9 4 8 3 6 0 1 5 (Accessed on 18.02.2015)

Porters Five Forces - h t t p:/ / w w w .wh a t m a k e sa g o o d l e a d er.c o m /P o rt e r s -fi v e -f o r c es.ht m l (Accessed on 23.02.2015)

Power ministry of India for APDRP and Rural electrification Project

h t t p : / / po w e r m i n . n ic. in / J S P _SERVL E TS / i n t ern a l . jsp (Accessed on 23.02.2015)

Acquisition of TAMCO switchgear – Data monitor 2015 h t t p : / / w w w . m ar k e t li n ei n f o .c o m/ li b ra r y / D is p lay C o n te n t.as p x ? N = 4 2 9 4 6 6 9 4 8 9 (Accessed on24.02.2015)

Target Markets for Low voltage and Medium voltage switchgear in India- Abhishek Gokhale, Industry Analyst Frost and Sullivan 2015

h t t p : / / w w w .f r o st. c o m/ p r od / se r v le t / m ark e t -i n si gh t-t op . p a g ? S r c=RS S &d o ci d = 1 5 6 8 5 5 1 7 8 (Accessed on 24.02.15)

Ministry of renewable energy – 2015h t t p:/ /m n es.n i c.i n / (Accessed on 19.02.2015

Infrastructure Growth in India – Data Monitor – Country Profile –India h t t p : / / w w w . m ar k e t li n ei n f o .c o m/ li b ra r y / D is p lay C o n te n t. a spx? N = 4 2 9 4 6 6 9 4 8 9 (Accessed on24.02.2015)

Rajesh Jeyachandran, Assistant Manager BCH Electric Limited (2015) - Market share of the different Switchgear Companies in India. – Through email dated 17.03.2015

Abbas GM, C&S Electric Switchgear, 2015 – L&T Performance over last three years including the present financial year – 2015 – Through email dated 14.03.2015

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MARKETING RESEARCH

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