STRATEGIC MANAGEMENT PROJECT REPORT

OF
PHILPS

MOHIT VASA

N.L. Dalmia Institute of Management Studies and Research

ROLL No – 280

MFM – SEM VI
 CONTENTS

1. about the consumer electronic industry

2. about Philips

3. Vision, Mission & Goals

3. SWOT Analysis

4. Environmental Scanning

6. BCG Matrix & GE Matrix

7. Grand Strategy

8. Conclusion
 ABOUT THE CONSUMER ELECTRONIC INDUSTRY

The consumer electronics industry is maturing at an incredibly rapid rate. Demand for consumer
electronic goods had always been there, but it really has reached its peak in the past few years. This
has subsequently triggered the expansion of the consumer electronics industry, which is turning into
the foremost profitable markets in world market.

In the last few years, there has been dynamic technological progress. The consumer electronics
industry continues to be employing advanced engineering to manufacture electronic goods which is
reaping massive profits as a result. People today live extremely hectic lives to keep up with the pace
of the world. A busy way of life calls for some form of fun. It is essential to invigorate the brain and
ease out anxiety and stress since bottled up tension can be harmful to health. Innovative products
have been developed which provide people with various kinds of enjoyment.

Apart from home entertainment, there are more electronic goods which have become a necessity in
our daily life. Consumers are increasingly becoming dependent upon electronic goods in their daily
lives since it saves them considerable time and energy. Consumer electronic goods have come to the
forefront in making the effort for a man simpler and perfect. These machines have become a part of
our everyday routine and it’s now tough to imagine a life without them. The consumer electronics
industry has definitely responded to the requirements of time. World-class correspondence
equipment like cellular phones, fax machines and computers are also needed in our daily lifestyles,
which is bringing society closer every day.

There are various causes of the development of consumer electronics industry. The consumer
electronics industry provides us with a huge selection of goods for daily use. These are found in
many areas of life which includes office, communications, and entertainment. The need for many of
the most popular electronic goods in our everyday life has added to the expansion of the consumer
electronics industry. Popular consumer electronic goods include essential equipment’s like
televisions, personal computers, radio, mobiles, microwaves, stereo systems, refrigerators, washing
machines as well as other gadgets.

The need for consumer electronic goods has drawn huge amount of investments for this business.
These investments have successively triggered the expansion of this business. The story of consumer
electronics around the world hasn’t followed a straight path. Different countries have climbed the
corporate ladder of success in this field of electronics faster compared to others in different periods.
Often, it’s been the United States of America while sometimes Asian countries like Japan and China
took over as the biggest providers of consumer electronic goods. However, there were additional
nations as well like Ireland and others who had shocked society with their accomplishments in the
field of electronics. US consumer electronics experienced tough competition from the Chinese and
Japanese manufacturers in the 1960s. As a result, the consumer electronics industry of the USA
diminished, but by the 1980s, the industry again gained its former position. The United States’
consumer electronics industry is the world’s premier consumer electronics industry.
 Innovation of Consumer Electronics

Even if you might have asked it a decade back, situation would’ve been noticeably diverse; yes, I’m
talking about the situation of consumer electronics. When compared to those bygone days, today be
consumer electronics industry has succeeded to such a position in which innovation runs the
motivator, the gas behind everything that is instinctive and sophisticated.

We now inhabit an era of extreme gadgetry pleasures with music systems, cell phones, Audio
Players, Pads, desktops, plasma Televisions, etc. Moulding the consumer electronics saga. Honestly
put, existence without these items would end up in chaos!

What’s the specialty for these products and services? Would it be really difficult to exist without
having these? Contemplate! Would you live without these? Absolutely not! Today’s technology has
advanced at such a amazing speed that we don’t have any idea when and just how we submit to
them in the process. Items are constantly being developed every day, keeping in mind what buyers
desire. Be it in your new kitchen or maybe your living room, in your telecommunications routine or
perhaps entertainment necessities, the existence of consumer electronics now can be experienced
anywhere. Credit goes to the key consumer electronic product developers that leave no stones
unturned to give the best in the market industry to their clients.

Aided by the advent of cyberspace, it is less difficult for consumers to get the merchandise of their
choice instantaneously. By simply browsing on the internet you can end up with a lot of information
about your specific products.

Another highlight is consumer electronic news reports to aid you on the net that will keep you up to
date regarding the latest happenings around the world of consumer electronics. Consumer
Electronic updates also can be very therapeutic for you in enlightening you about the most recent
releases by means of similar manufacturers.

CONSUMER ELECTRONIC INDUSTRY IN INDIA

The electronic industry in India took off around 1965 with an orientation towards space and defence
technologies. This was rigidly controlled and initiated by the government. This was followed by
developments in consumer electronics mainly with transistor radios, black and white TV, calculators
and other audio products. Colour televisions soon followed. In 1982 a significant year in the history
of TV in India – the government allowed thousands of colour

TV sets to be imported into the country to coincide with the broadcast of Asian games in New Delhi.
1985 saw the advent of computers and telephone exchanges, which were succeeded by digital
exchanges in 1988. The period between 1984 and 1990 was a golden period for electronics during
which the industry witnessed continuous and rapid growth.

From 1991 onwards, there was first, an economic crisis triggered by the Gulf War which was
followed by political and economic uncertainties with the country. Pressure on the electronic
industries remained though growth and developments have continued with digitalisation in all
sectors, and more recently the trend towards convergence of technologies. After the software boom
in mid-1990’s India’s focus shifted to software. While the hardware sector was treated with
indifference by successive governments. More over the steep fall in custom tariffs made the
hardware sector suddenly vulnerable to international competition.
CURRENT SCENARIO

In recent years the electronic industry is growing at a brisk pace. It is currently worth US$ 32 billion
and according to industry estimates it has the potential to reach US$150 billion by 2012. The largest
segment is the consumer electronics segment. While is largest export segment is of components.

The electronic industry in India constitutes just 0.7% of the global electronic industry. Hence it is
miniscule by international comparison. However the demand in the Indian market is growing rapidly
and investments are flowing into augment manufacturing capacity.

The output of the electronic hardware industry in India is worth US$11.6 billion at present. India is
also an exporter of a vast range of electronic components and products for the following segments.

1. Display technologies

2. Entertainment electronics

3. Optical storage devices

4. Passive components

5. Electromechanical components

6. Telecom equipment

7. Transmission and signalling equipment

8. Semiconductor designing

9. Electronic manufacturing services

This growth has attracted global players to India and leaders like Solectron, Flextronics, Sony,
Panasonic, Philips, Nokia, and many more have made large investments to access the Indian market.
The consumer electronics Korean companies such as LG and Samsung have made commitments by
establishing large manufacturing facilities and now enjoy a significant share in the growing market
for products such as Televisions, CD/DVD players, Audio equipment and other entertainment
products.

Challenges

The biggest threats to the local industry going forward are supply-related issues pertaining to
distribution and infrastructure, as well as demand issues due to competition from imported goods.
The lack of well-developed distribution networks makes it especially challenging to penetrate the
fastest growing rural areas economically. In addition, regular power cuts and poor road linkages
make systematic production, assembly and delivery problematic.

On the demand side, customers have increasing choice from both domestically produced and
imported goods, with similar features. This homogeneity makes it difficult for players to remain
ahead of the competition. MNCs hold an edge over their Indian counterparts in terms of superior
technology combined with a steady flow of capital, while domestic companies compete on the basis
of their well-acknowledged brands, an extensive distribution network and an insight in local market
conditions. The largest MNCs incorporated in India are Whirlpool, LG, and Samsung Sony
 Royal Philips Electronics

Royal Philips Electronics of the Netherlands is a diversified Health and Well-being company, focused
on improving people’s lives through timely innovations. As a world leader in healthcare, lifestyle and
lighting, Philips integrates technologies and design into people-centric solutions, based on
fundamental customer insights and the brand promise of “sense and simplicity”.

Headquartered in the Netherlands, Philips employs over 120,000 employees with sales and services
in more than 100 countries worldwide. With sales of EUR 22.3 billion in 2010, the company is a
market leader in cardiac care, acute care and home healthcare, energy efficient lighting solutions
and new lighting applications, as well as lifestyle products for personal well-being and pleasure with
strong leadership positions in male shaving and grooming, portable entertainment and oral
healthcare.

Global Footprint

Philips is a global leader across its healthcare, lighting and lifestyle portfolio. It is the world’s largest
home healthcare company, being number one in: Monitoring systems, Automated External
Defibrillators, Cardiac Ultrasound, and Cardiovascular X-ray. We are number one in lamps in Europe,
Latin America and Asia Pacific and number two in North America; in Automotive lighting, we are
leading in Europe, Latin America, Japan and Asia Pacific. We are number one in the electric shavers
and male grooming category globally.

Businesses

Healthcare

Philips simplifies healthcare by focusing on the people in the care cycle – patients and care
providers. Through combining human insights and clinical expertise, Philips aim to improve patient
outcomes while lowering the burden on the healthcare system. Advanced healthcare solutions are a
fundamental part of the portfolio for both healthcare professionals and consumers, to meet the
needs of patients in hospitals and at home. Philips Healthcare employs approximately 35,500 people
worldwide.

Lighting

Philips Lighting is the leading provider of lighting solutions and applications both for professional and
consumer markets, transforming how lighting is used to enhance the human experience in the
places where people live and work. Whether at home, on the road, in the city, shopping, at work or
at school, we are creating lighting solutions that transform environments, create experiences, and
help shape identities.

We serve our customers through a market segment approach which encompasses Homes, Office
and Outdoor, Industry, Retail, Hospitality, Entertainment, Healthcare and Automotive. For these
segments we provide a wide range of offerings from across the entire lighting value chain - from
light sources, luminaries and lighting controls to lighting solutions and services. Philips Lighting
employs approximately 53,000.
Consumer Lifestyle

Guided by the brand promise of “sense and simplicity” and the consumer insights, Philips Consumer
Lifestyle offers rich, new consumer experiences that meet consumers’ desire for relaxation and
improving their state of mind. Philips also responds to the consumer's desire for wellness and
pleasure by introducing products that meet the individual’s interests in terms of their body and
appearance. Philips Consumer Lifestyle employs approximately 17,700 people worldwide.

Innovation

50,000 registered patents illustrate the innovative nature of the company. Philips currently holds
around 36,000 registered trademarks, 63,000 design rights and 3,900 domain names. Philips has
adopted an Open Innovation strategy which leverages the joint innovative power of partnering
companies and researchers to bring more innovations to the market effectively and faster. In 2010,
Philips invested EUR 1.58 billion in Research and Development. Philips is internationally recognized
as a global leader in design, receiving a variety of international awards each year. For example: 2010
if product design competition: 28 design awards

Sustainability

Sustainability is at the centre of Philips’ strategy. Philips is committed to reducing its environmental
footprint in all aspects of its business: in its products, manufacturing, and procurement, as well as in
the communities where the company acts and in the working practices of its employees. All Philips
products go through an Eco-design process, identifying environmental impact in terms of energy
efficiency, hazardous substances, take-back and recycling, weight and lifetime reliability. Philips’
processes on Green Product sales are verified annually by an independent third party and published
in the Annual Report. Philips aims to combat global healthcare challenges by focusing on delivering
better quality healthcare at lower costs, also in the emerging markets, such as China and India.
Philips also takes a leading position in educational programs, showing its stakeholders that energy
efficient solutions are simple, easy and actionable and make economic sense for national and local
governments, businesses, schools and individuals.
Mission

"Improve the quality of people’s lives through timely introduction of meaningful innovations."

Vision

“In a world where complexity increasingly touches every aspect of our daily lives, we will lead in
bringing sense and simplicity to people.”

Behaviours

1. Eager to win
2. Take ownership
3. Team up to excel

Brand Promise

We empower people to benefit from innovation by delivering on our brand promise of “sense and
simplicity”. This brand promise encapsulates our commitment to deliver solutions that are
advanced, easy to use, and designed around the needs of all our users.

MID TERM (2018) PERFORMANCE TARGETS

Philips’ business portfolio is well positioned in highly attractive markets and geographies to
capitalize on global trends. The large majority of the business has the right fundamentals for
profitable organic growth. Philips mid-term performance goals are:

Comparable sales growth of 4-6%, assuming real GDP growth of 3-4% per annum

Reported EBITA margins of 10-12% for the group

15 – 17 % for healthcare

8 – 10 % for consumer life style

8 – 10 % for lighting

Return on investment capital of 12 – 14 %

 SWOT Analysis

Strength:-
Brand – As Philips entered the Indian market before 120 years, they exactly know the
behaviour of the Indian consumers. So according to the consumer’s requirements the Philips
Company has positioned its brand in the market and in the consumers mind. Now in Indian
context, Philips means a brand that can be relied upon and the consumers in India believe
on this brand. It has become a house hold brand. The main advantage is that the diverse
product line of the company. It has almost all the products which are used by everyone in
the house and also the products for general use. For ex. Philips has lighting solutions,
trimmers, electric toothbrush, led lamps, mixers, home theatres, iron box, mp3 player, DVD
player etc.,. Which includes all the possible products which is used by all members of the
house. So indirectly this factor is affecting the minds of the people which is making the
Philips to grow in the market.
Quality – The brand name of the company stays fit in the consumers mind. And the main
reason for that is the quality of the product which is produced by the company directly or
indirectly with the brand name of Philips. Even though the company is a old player in the
Indian market, without the right quality it could not reach the position that it is there now.
The Indian customers are mainly price sensitive at the same time they also give importance
to the quality and this is the main part which made Philips gain a huge market share.
Service – The service is a extra credit given to the customers by the sellers in order to gain
the good will and to get the consumer in to good terms with the company who will in future
will become a loyal customer of the company. Here the company always tries to make a
point that, once a consumer uses the product of the company he should not even think of
the other brand. If that is the quality and service provided to the consumer he will never
leave and go the brand. So, here service plays a big role and that is the strength of Philips as
they provide a good after sales service to the consumers. They have their own exclusive
service centres and linked with many big names in the market in order to give the service.
Distribution channel – A strong distribution channel is like a solid nerve system of the
human body. So if the company has a strong distribution channel the selling of the products
becomes easy. Philips has 8 intermediaries in Bangalore and every 1person for a district in
Karnataka and this acts as a strong hand of the company. They depend on their distribution
channel heavily and till date the results are positive from them.

WEAKNESS:-
Limited stock availability in the company – The Company has a very strong distributing channel
which will help them in selling the Philips products in a good pace. So when the situation is good for
sale the availability of goods becomes a real problem and this poses a big question in front of the
company. The Philips is also facing the same problem in recent years. As almost 70 – 80 % of the
products are imported to India, the problem of stock availability is more. The importing norms will
have different rules and regulations to the company that they can import only certain volume of
particular products in a month or something like that. So the estimation will always not help in
importing the goods. Because the human psychology plays a huge role in this decision making. So it
is very difficult and hence this problem is breaching the Philips India limited.

Limited product line – Though the company has a strong product line, the marketing heads in the
company are of a opinion that the product line of the company should be increased in order to give
the customers what they really want. This is a right thought that the growing population in India
wants some newness in the products and they like it to be unique from others. So increasing the
product line may attract many more consumers towards the company in the recent years. As the
product line is limited in a particular sector boredom of buying a same type of product has come into
the consumers mind.

OPPORTUNITY:-
The company is mainly concentrated upon the health care and lighting sector through which the
company got a brand name which is very much in the minds of the consumers. So, now at this point
of time if the company introduces as many as household appliances, into the market, it will gain a
huge market share interms of household electronic appliances. This step will be a wise move by the
company.

Another huge opportunity with the Philips Company is that of making the pricing methods by
acquisition. If the company acquires any local company and make them produce the products of
Philips in their plant which will reduce the cost of the product drastically. Philips has done many such
things in the past time for ex – acquiring Preethi Company in the South India which helped them to
reduce and stabilize their pricing method.

THREAT:-
The big threat and challenge of the Philips Company is that of the China made products which have a
intense effect in the Indian market. Because of these products the Philips Company is facing a huge
problem in the Indian market. This problem is mainly concerned on the pricing methods of the
company. The consumers expect that the price of the Philips Company should also be reduced. But
Company is not in a position to do so.
 Environmental Scanning
Putting the right product in the right place, at the right price, at the right time.

The marketing mix is a business tool used in marketing products. The marketing mix is often
synonymous with the 'four Ps': 'price', 'promotion', 'product', and 'place'. The term "marketing mix"
was coined in 1953 by Neil Borden in his American marketing association presidential address.
However, this was actually a reformulation of an earlier idea by his associate, James Culliton, who in
1948 described the role of the marketing manager as a "mixer of ingredients", who sometimes
follows recipes prepared by others, sometimes prepares his own recipe as he goes along, sometimes
adapts a recipe from immediately available ingredients, and at other times invents new ingredients
no one else has tried.

You just need to create a product that a particularly group of people want, put it on sale some place
that those same people visit regularly, and price it at a level which matches the value they feel they
get out of it; and do all that at a time they want to buy. Then you've got it made!

The marketing mix and the 4 Ps of marketing are often used as synonyms for each other. In fact,
they are not necessarily the same thing.

"Marketing mix" is a general phrase used to describe the different kinds of choices organizations
have to make in the whole process of bringing a product or service to market. The 4 Ps is one way.
And the 4ps are:

1. Product
2. Place
3. Price
4. Promotion

Product

What does the customer want from the product? What needs does it satisfy?

What features does it have to meet these needs?

Are there any features you've missed out?

Are you including costly features that the customer won't actually use?

How and where will the customer use it?

What does it look like? How will customers experience it?

What size(s), colour(s), and so on, should it be?

What is it to be called?

How is it branded?

How is it differentiated versus your competitors?

What is the most it can cost to provide, and still be sold sufficiently profitably? (See also Price,
below).
Place

Where do buyers look for your product or service? If they look in a store, what kind? A specialist
boutique or in a supermarket, or both? Or online? Or direct, via a catalogue? How can you access
the right distribution channels?

Do you need to use a sales force? Or attend trade fairs? Or make online submissions? Or send
samples to catalogue companies?

What do you competitors do, and how can you learn from that and/or differentiate?

Price

What is the value of the product or service to the buyer?

Are there established price points for products or services in this area?

Is the customer price sensitive? Will a small decrease in price gain you extra market share? Or will a
small increase be indiscernible, and so gain you extra profit margin?

What discounts should be offered to trade customers, or to other specific segments of your market?

How will your price compare with your competitors?

Promotion

Where and when can you get across your marketing messages to your target market?

Will you reach your audience by advertising in the press, or on TV, or radio, or on billboards? By
using direct marketing mailshot? Through PR? On the Internet?

When is the best time to promote? Is there seasonality in the market? Are there any wider
environmental issues that suggest or dictate the timing of your market launch, or the timing of
subsequent promotions?

How do your competitors do their promotions? And how does that influence your choice of
promotional activity?

The marketing mix model can be used to help you decide how to take a new offer to market. It can
also be used to test your existing marketing strategy.

Whether you are considering a new or existing offer, follow the steps below help you define and
improve your marketing mix.

1. Start by identifying the product or service that you want to analyse.

2. Now go through and answer the 4Ps questions – as defined in detail above.

3. Try asking "why" and "what if" questions too, to challenge your offer. For example, ask why your
target audience needs a particular feature. What if you drop your price by 5%? What if you offer
more colours? Why sell through wholesalers rather than direct channels? What if you improve PR
rather than rely on TV advertising?
The different product lines of the Philips Company are:

1. Imaging Systems
2. Home Healthcare Solutions
3. Patient Care and Clinical Informatics
4. Television
5. Personal Care
6. Audio & Video
7. Multimedia
8. Domestic Appliances
9. Health &Wellness
10. Accessories
11. Lamps
12. Consumer Luminaries
13. Professional Luminaries
14. Lighting
15. Electronics and Controls
16. Automotive Lighting
17. Packaged LEDs
18. LED solutions
 BCG MATRIX

Cash cows are units with high market share in a slow-growing industry. These units typically
generate cash in excess of the amount of cash needed to maintain the business. They are regarded
as staid and boring, in a "mature" market, and every corporation would be thrilled to own as many
as possible. They are to be "milked" continuously with as little investment as possible, since such
investment would be wasted in an industry with low growth.
Dogs, or more charitably called pets, are units with low market share in a mature, slow-growing
industry. These units typically "break even" ,generating barely enough cash to maintain the
business's market share. Though owning a break-even unit provides the social benefit of providing
jobs and possible synergies that assist other business units, from an accounting point of view such a
unit is worthless, not generating cash for the company. They depress a profitable company's return
on assets ratio, used by many investors to judge how well a company is being managed. Dogs, it is
thought, should be sold off.

Question marks (also known as problem child) are growing rapidly and thus consume large amounts
of cash, but because they have low market shares they do not generate much cash. The result is
large net cash consumption. A question mark has the potential to gain market share and become a
star, and eventually a cash cow when the market growth slows. If the question mark does not
succeed in becoming the market leader, then after perhaps years of cash consumption it will
degenerate into a dog when the market growth declines. Question marks must be analysed carefully
in order to determine whether they are worth the investment required to grow market share.

Stars are units with a high market share in a fast-growing industry. The hope is that stars become the
next cash cows. Sustaining the business unit's market leadership may require extra cash, but this is
worthwhile if that's what it takes for the unit to remain a leader. When growth slows, stars become
cash cows if they have been able to maintain their category leadership, or they move from brief
stardom to dogdom.

For the Philips company in particular,

Question mark - Personal care

Star - Health Care

Cash cow – Lighting

Dogs - Home appliances

Personal care is an area from which the company gets a very less profit. There may be many reasons
for that. For ex, the profit margin may be less or people are not aware of it. Whatever be the reason
the products which comes under personal care do not give much profit to the company even though
the product resides in the market there is not much use of it. The only use is that they can boast
about their diverse product line and nothing more than that. So, we have positioned this particular
personal care in the place of question mark to show the non-performance of the particular line of
products.

The Philips Consumer Lifestyle sector is organized around its markets, customers and consumers,
and is focused on value creation through category development and delivery through operational
excellence. The market-driven approach is applied with particular emphasis at local level, enabling
Consumer Lifestyle to address a variety of market dynamics and allowing the sales organizations to
operate with shorter lines of Communication with the sector’s six businesses. This also promotes
customer centricity in day-to-day operations.
In 2010 the sector consisted of the following areas of business:

• Health & Wellness: mother and child care, oral healthcare

• Personal Care: shaving and grooming, female depilation, hair care, vita light, skincare

• Domestic Appliances: kitchen appliances, beverages/ espresso, garment care, floor care, water, air

• Television

• Audio & Video Multimedia: home audio, home video, home cinema sound, portable audio and
video

• Accessories: on-the-go accessories, together @ home accessories, personal displays, speech

processing

We have positioned the health care as a star of Philips. This is the line where the company is getting
enough profit and are putting their all worth to improve this line. Health care of the Philips is so
famous all over the world. Their maximum revenue is coming from the health care and they want to
improve that also. Philips is one of the top-tier players in the healthcare technology market (based
on sales) alongside General Electric (GE) and Siemens. Our Healthcare sector has global leadership
positions in areas such as cardiac care, acute care and home healthcare. Philips Healthcare’s current
activities are organized across

Four businesses:

• Imaging Systems: interventional X-ray, diagnostic X-ray, computed tomography (CT), magnetic
resonance (MR), nuclear medicine (NM) and ultrasound imaging equipment, as well as women’s
health

• Patient Care & Clinical Informatics: cardiology informatics, including diagnostic

electrocardiography (ECG); enterprise imaging informatics, including Radiology information systems
(RIS) and picture archiving and communication systems (PACS); patient monitoring and clinical
informatics; prenatal care, including fatal monitoring and Philips Children’s Medical Ventures; and
therapeutic care, which includes cardiac resuscitation, emergency care solutions, therapeutic
Temperature management, hospital respiratory systems, and ventilation

• Home Healthcare Solutions: sleep management and respiratory care, medical alert services,
remote cardiac services, remote patient management

• Customer Services: consultancy, site planning and project management, clinical services, Ambient
Experience, education, equipment financing, asset management and equipment maintenance and
repair.

Philips Lighting is a global market leader, with recognized expertise in the development,
manufacturing and Application of innovative lighting solutions. We have pioneered many of the key
breakthroughs in lighting over

The past 100 years, laying the basis for our current position. We address people’s lighting needs
across a full range of market segments. Indoors, we offer specialized lighting solutions for homes,
shops, offices, schools, hotels, factories and hospitals. Outdoors, we provide lighting for public
spaces, residential areas and sports arenas. We also help to make roads and streets safer for traffic
and other road users (car lights and street lighting). In addition, we address the desire for light-
inspired experiences through architectural projects. Finally, we offer specific applications of lighting
in specialized areas, such as horticulture, refrigeration lighting and signage, as well as heating, air
and water purification, and healthcare. Philips Lighting spans the entire lighting value chain – from
lighting sources, electronics and controls to full applications and solutions – via the following
businesses:

• Lamps: incandescent, halogen, (compact) fluorescent, high-intensity discharge

• Consumer Luminaries: functional, decorative, lifestyle, scene-setting

• Professional Luminaries: city beautification, road lighting, sports lighting, office lighting,
shop/hospitality lighting, industry lighting

• Lighting Systems & Controls: electronic and electromagnetic gear, controls, modules and drivers

• Automotive Lighting: car headlights, car signalling, interior

• Packaged LEDs

• LED solutions: modules, LED replacement lamps

Home appliances

Philips Design is one of the longest-established design organizations of its kind in the world. It is
headquartered in Eindhoven, the Netherlands, with branch studios in Europe, the US and Asia
Pacific. Its creative force Comprises designers, psychologists, ergonomists, sociologists, philosophers
and anthropologists working Together to understand people’s needs and desires in order to
generate designs which support people in? Accomplishing and experiencing things in natural,
intuitive ways. Philips Design’s forward-looking exploration projects deliver vital insights for new
business development, supporting the transformation towards a health and wellbeing company. In
focusing on the domain of health and well-being, we are tapping into significant trends – such as
consumer empowerment, growth in emerging markets and aging populations – that will have a
major impact on society in the future.

Healthy Life

The Healthy Life value space takes a holistic approach to enhancing consumers’ health, addressing
the needs for mental and physical health and for healthy relationships..

Personal Care

The Personal Care value space addresses the consumer need to “look and feel your best” and so
helps people feel more confident.

Home Living

The Home Living value space addresses consumers’ pressing need to have more time to spend on
themselves or with family and friends. We do this by creating high quality solutions that enable quick
and convenient cooking, preparation of beverages, cleaning, caring and home comfort.

Lifestyle Entertainment

Lifestyle Entertainment is about enjoying entertainment and the little events in everyday life:
sharing time with family and friends, having time off from a hectic schedule, and moments of
comfort, fun and caring.
 GE MATRIX
The GE matrix helps a strategic business unit evaluate its overall strength. Each product, brand,
service, or potential product is mapped in this industry attractiveness/business strength space. The
GE multi factorial was first developed by McKinsey for General Electric in the 1970s.

GRAND STRATEGY

1. How does it feel to compete with Videocon and other competitors in India?

In the statistics, Videocon is the toughest competitor of Philips India Ltd. But in practice, Videocon
acts as a partner of the company. Philips Company gives the TV panel to the Videocon in order to
market the product of the Philips. Indirectly the Philips Company is getting the marketing done by
the Videocon Company. So in practicality the Philips company is not directly competing with the

Videocon Company.

2. Where has the electronic market headed in India? Does the entry of Sony and Panasonic threaten
Philips?

The electronic market in India is heading in a very good way. The boom in the electronic market is
huge in this time. A very good opportunity for all the electronic manufacturers in India to have a
good profit. The disposable profit of the consumer of India is rising day by day and the trend to have
sophisticated electronic gadgets in the house hold is becoming more and more day by day.
The entry of the MNC companies to the Indian market do not put a lot of competition to the Philips
as Philips is dealing in the Indian market for the past 120 years and they know how exactly to deal
with the situations in the Indian market. So entry of some MNC’s like Sony or Philips is not such a
huge competition or head breaking situation. So, there is no huge threat from the entry of the
companies like Sony or Panasonic.

3. Is Philips India profitable yet? Where do you see the company in the next few years?

Surely the Philips India is profitable at the current point of time. As they know the true nature of the
market they are strong in their footholds and they are good at it. So profit will not be a matter of
fact at any point of time to Philips.

We can see the company as a leader in the market for consumer goods-electronics in the Indian
market in next few years.

4. What do you see as the greatest challenge of Philips in India?

The company was situated in India before 120 years. So the behaviour of the consumers in the
Indian market is well known to the company. The maximum part of consumers are those who give
much importance to the price of the product than to the quality. So price becomes the main factor in
this context. Even though the company knows very well about the behaviour of the consumers, the
changing trend of the consumers in India is very drastic and this becomes the challenge to the
Philips. As pricing is the main factor, because of the entry of the China products, the value of
electronic items has gone very low and hence it forces the quality products also to reduce their
prices. But the Philips Company did not do this. They stick to their pricing policy which sometimes
causes problems.

5. Which is Philips main line product?

The mainline products are the products which give the profit to the company and help to acquire the
market share. The mainline products of the Philips Company are: Iron box, Mixers, Home theatres,
DVD players, Trimmers and Shavers, Radios. Lighting as a whole is the main line product of Philips.
They are dealing with this from a long time and so they are experienced in this line of products and
most importantly they have a very good brand name in lighting solutions. So this becomes their
mainline product

6. What kind of promotion do you follow?

Philips plans the promotions in different ways. One of the ways is that of seasonal wise. For ex, if
there comes Diwali, they will set such promotional activities which suits the occasion. In other kind
of promotional activities, like giving discounts, giving adds in different Medias, newspaper ads, free
with one product.
 CONCLUSION & RECOMMENDATION

1. Philips is India’s largest and most preferred lighting and health care instruments company.
2. Through its strategic long-term tie-ups with key and critical auxiliary manufacturers, Philips
provides its customers many benefits.
3. The brand’s vision is to deliver excitement to the consumers, by providing comfort at its
best.
4. Complete control over core components and technology.
5. The company has strong potential to grow and that through greater innovations.
6. In addition to corporate sector the company has the option to step into the local household
by understanding their psychology.
7. In short it can be said that the company is still growing by making constant efforts.