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HowMicromaxcrackedthecode|BusinessStandardNews
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HowMicromaxcrackedthecode
Injustfouryears,themobile,tabletandnowTVplayerisgivingmultinationalsarunfortheirmoney
ShivaniShinde|MumbaiOctober10,2012LastUpdatedat00:00IST
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HowMicromaxcrackedthecode|BusinessStandardNews

Naxalcouplesurrender
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ItleadsthetabletmarketinIndiaaheadofglobalgiantslikeSamsungandApple(accordingtoCyberMediaResearchfiguresreleasedonMonday)andis
thethirdlargestmobileplayerintermsofvolumes.
Micromax,whichenteredthemobilespacejustfouryearsagoin2008,isdoingallthis,andmore:thecompanyonTuesdayforayedintothehome
entertainmentspacewithLEDtelevisionsandhometheatresystems.
AndcofounderRahulSharmasaysitsquitepossiblethatMicromaxwilldoaSamsungandstormtheglobalmarketswithitsproducts.Asabrand,we
wanttobeabletotouchthelivesofconsumers.ThewholeconversionfrommobilephonestosmartphonetotabletsandtoTVwillhappensoonerthan
later.Andwewanttobepartofthatstory,saysSharma.
Withpresenceinninecountries,Sharmaatthemomentisfocusingonthedomesticmarketandwantstocapturealltheavailablescreensinthecountry.
ThatmaynotbetootallaclaimastheIndiaQuarterlyMediaTabletMarketReviewforthesecondquarterofthisyearshowsMicromaxhas18.4per
centofthetabletmarketinIndiaagainstSamsungs13.3percentandApples12.3percent.
Thecompanyhasalsobeeninchingupinthemobilesegment.Apartfrombeingthethirdlargestplayerwith8percentsharebehindNokiaand
Samsung,itisalsothe12thlargestmanufacturer.TheGlobalHandsetVendorMarketsharereportfromStrategyAnalyticsstatedinthesecondquarterof
2011(thelatestfiguresavailable),Micromaxtoppedthemicrovendorrankings,shippingfourmillionhandsetsworldwide.
Thenumbersareimpressiveforalateentrant.Infouryears,Micromaxhasmanagedtologinsalesofcloseto1.5millionhandsetspermonth.
SowhatisthekeytoMicromaxsuccess?Expertsattributeittolowpricing,uniquefeatures,focusonentrylevelproductsandahugedistributionset
up.Inthetabletspace,itsproductsstartatRs6,000andgouptoRs9,999.ThesameisevidentinitsLEDTVlaunch.AnentrylevelLEDTVof24
fromMicromaxcostsRs15,990andafullHDsmartTVof55costsRs129,990.
ButSharmadownplaysthepricewarrioradjective.Pricingwasneverourdrivingforce.Whenwelaunchedourfirstmobilehandset,itcamewitha
batterythatlastedfor30days.Inthetabletspace,wefocusedontheeducationandtheentertainmentsegment.Goingaheadyouwillseemoreproducts
intablet.Thevolumesinthisspaceareonlyexpectedtogoup,Sharmasays.
Micromaxstrategywiththetabletrevolvesaroundeducationandentertainment(edutainment).TheFunbookhastieupforeducationrelateddigital
contentfromPearson,EveronnandVriti.Forentertainment,itcomespreloadedwithBigflix(freemovieforamonth),Hungama,Indiagamesand
Zenga.MicromaxintroduceditsproductonlyinAprilthisyearandwithfiveproducts,ithassalesof65,00070,000permonth.
AsignificantaspectofMicromaxssuccessisitsdistributionnetwork.Thisissomethingthatthefoundersinheritedrightatthetimeofinception.
Micromaxwasfoundedin1991byRajeshAggarwalwhowasadistributorforcomputerhardwareofbrandssuchasHP,DellandSony.Foreach
categoryofproducts,thedistributionchannelvaries.
Forfeaturephonesandtablets,thecompanyhasathreetierdistributionsetup,andforsmartphonesandLEDTVs,itsatwotiermodel.Thethreetier
setupincludes80largepartners,2,500smallpartners,followedbyanetworkof125,000smallretailoutletsspreadacrossthenation.
TelecomindustryexpertsalsobelievethatthecompanyhasmanagedtounderstandtheIndianconsumerpsychemuchbetterthanthemultinationals.
EntryleveltabletistherealbattlegroundinIndia.Thereisahugeamountofactivityinthetabletspace,especiallysincethegovernmentinitiated
Aakashtablets.Theusersareawarethatthesearenotsomefancygadgetsbutentryleveloffering.ThatiswhereMicromaxhasgainedmarketshare,
saysVenuReddy,DirectorIDC.
Similarlyinthesmartphonesegment,thecompanyhastriedtoincludeapplicationsthatwillmakeitsproductsstandoutdespitethelowpricestamp.
Forus,smartphoneisnotaboutplainvanillafeatures.Wewillnevercompromiseontheuserexperience,andyeswehavealsotriedtocontroltheprice
points.Thattooisimportantifyouwantmoreandmoreusersforourproducts,saysSharma.
Thecompanydoeshavemanyfirststoitscreditwhenitcomestothemobilehandsetmarket.Forinstance,the30daybatterybackup,dualSIMphones,
Quertykeypads,dualreceptionmodehandsets,universalremotecontrolmobilephonesetcthattooataverylowpricepoint.
Ifthissoundstoogoodtobetrue,listentoFaisalKawoosa,LeadAnalyst,CMRTelecomsPractice.Kawoosasaysthekeytokeepingthepricesdownis
atightandefficientsupplychainmanagement,whichinvolvesvendorselectionandvolumeplay.Thekeyaspectsinmanagingcostinanyhandsetare
thefeaturesthatavendorisoffering,thechoiceofvendorpartnerandthevolumeplay.Whilethereareseveraltechcomponentstoatabletandhandset,
thekeyelementsincludememory,display,chipset,batteryandofcoursethebrandvalue.Soplayerswhoarecateringtothelowersegmentwillfocuson
theseissues.IncaseofMicromax,thecompanyworkswithchipmakerssuchasMediatek,MStar(whichisnowmergedwithMeditek),andQualcomm.
AlsoseveralplayerssuchasQualcommandSamsungbundlecomponentssuchascamera,sensors,memory,displaydriversandreferencedesigninto
thechipsets,whichbringdowntheprice.
InthesmartphonesegmentthatisconsideredtobeoneofthefastestgrowingsegmentinIndia,Micromaxhassalesof100,000to150,000amonth.But
thisisasegmentwhereitispittedagainststrongplayerslikeSamsung,NokiaandHTC.Likeseveralofitsglobalpeers,Micromaxtooistryingtoadd
uniqueapplications.AfterApplesSiri,avoicecontrolledpersonalassistant,MicromaxcameupwithAishawiththesamefeatures.Lastmonthitalso
launchedamobilemessagingapplicationHookUp.ItsunlikeanyofthemessagingservicesastheuserusingHookUPcanalsosendmessagestoa
personwhodoesnotusetheapplication,addsSharma.
ThebiggestdifferentiatorofMicromaxcomparedtootherdomesticorChineseplayersistheconnectithascreatedwithitsbrand.Amongthelocal
players,itisthestrongestbrand.WhileNokiacontinuestoruleintheoverallmobilehandsetmarket,Micromaxhasemergedastrongdomesticplayer.It
willbeinterestingtoseehowMicromaxbreaksthebarrierinthesmartphonesegment,saysAnshulGupta,principalresearchanalyst,Gartner.
Readmoreon:
Micromax
|
Samsung
|
Apple
|
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Nokia
|
Hp
|
Dell
|
RajeshAggarwal
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RahulSharma
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CybermediaResearch
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