EXPORT STRATEGIES OF PHILIPS

CHAPTER 1 INTRODUCTION
1.1 PROFILE OF THE ORGANISATION Philips Electronics India Limited: Philips Electronics India Limited, a subsidiary of the Netherlands-based Royal Philips Electronics, is the leading Health and Wellbeing company. Today, Philips is a simpler and more focused company with global leadership positions in key markets of Healthcare, Lighting and Consumer Lifestyle, addressing peoples Health and wellbeing needs and aspirations as its overarching theme. As one of the nation's most well-known and well-loved brands, Philips is a part of practically every Indian's life. With recent launch of Philips Respironics product categories in obstructive sleep apnea management and home respiratory care, home decorative lighting range and ALU range, Philips products find use in virtually every aspect of an individuals daily life 24X7 - at home, at work, on the move and at rest. Philips stands as a source of easy to use, trendy and innovative internationally acclaimed products with superior design and technology that enhance the quality of consumers' professional and personal lives. Philips has been operating in India for over 75 years and employs over 4,500 employees around the country. The company has an excellent pan India distribution and after-sales service network. Philips is one of the largest electronics companies in the world. In 2009, its sales were 23.18 billion. The company employs 115,924 people in more than 60 countries. Philips is organized in a number of sectors: Philips Consumer Lifestyles (formerly Philips Consumer Electronics and Philips Domestic Appliances and Personal Care), Philips Lighting and Philips Healthcare (formerly Philips Medical Systems). Improving peoples lives through meaningful innovation VIVEK COLLEGE OF COMMERCE Page 1

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For the past 120 years our meaningful innovations have improved the quality of life for millions, creating a strong and trusted Philips brand with market access all over the world. In light of key global trends and challenges e.g. the demand for affordable healthcare, the energy efficiency imperative, and peoples desire for personal well-being we are confident in our chosen strategic direction VisionIn a world where complexity increasingly touches every aspect of our daily lives, we will lead in bringing sense and simplicity to people. ValuesOur Values reflect the ambitions we have laid down in Vision 2010, our recent strategy update. The Values, the four Ds, are like a compass guiding us in how we behave every day, and reminding us of the attitudes we should have towards our work, our customers and our

MisionImprove quality of peoples lives through timely introduction of meaningful innovations. EVOLUTION OF PHILIPS AS A BRAND

Wherever encountered, the Philips brand is a familiar sight in millions of households and buildings throughout the world with its instantly recognizable word mark of seven blue capitalized letters. Although the company has evolved and grown over more than hundred years, Philips visual brand identity is rooted in its early years at the beginning of the 20th century.

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Philips in 20th Century: First Lamp Advertisements Established in 1891 in Eindhoven, the Netherlands, Philips & Co. was founded to meet the growing demand for light bulbs following the commercialization of electricity. In the early years of Philips & Co., the representation of the company name took many forms: one was an emblem formed by the initial letters of Philips & Co., and another was the word Philips printed on the glass of metal filament lamps.

One of the very first campaigns was launched in 1898 when Anton Philips used a range of postcards showing the Dutch national costumes as marketing tools. Each letter of the word Philips was printed in a row of light bulbs as at the top of every card. In the late 1920s, the Philips name began to take on the form that we recognize today. Philips Identity Trademarked: Origins of the Shield Emblem The now familiar Philips waves and stars first appeared in 1926 on the packaging of miniwatt radio valves, as well as on the Philigraph, an early sound recording device. The waves symbolized radio waves, while the stars represented the ether of the evening sky through which the radio waves would travel. In 1930 it was the first time that the four stars flanking the three waves were placed together in a circle. After that, the stars and waves started appearing on radios and gramophones, featuring this circle as part of their design. Gradually the use of the circle emblem was then extended to advertising materials and other products. At this time Philips business activities were expanding rapidly and the company wanted to find a trademark that would uniquely represent Philips, but one that would also avoid legal problems with the owners of other well-known circular emblems. This wish resulted in the combination of the Philips circle and the word mark within the shield emblem. In 1938, the Philips shield made its first appearance. Although modified over the years, the basic design has remained constant ever since and, together with the word VIVEK COLLEGE OF COMMERCE Page 3

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mark, gives Philips the distinctive identity that is still embraced today. 1.2 Advertising Philips Brand Today : Whilst the logo of the company has been consistent since the1930s the way in which Philips has advertised and communicated to the outside world has varied. In general, until the mid-1990s all advertising and marketing campaigns were carried out at product level on a local market basis. This led to many different campaigns running simultaneously, not giving a global representation of Philips as a global company. To establish consistent global presence, in 1995 Philips introduced the first global campaign in 1995 under the tagline Lets make things better. This theme encapsulated the One Philips thinking and was rolled out globally in all markets and on all Philips products. This was also the first campaign that bought the whole company together, giving the employees a sense of belonging and providing a unified company look for an external audience. In September 2004, Philips launched its sense and simplicity brand promise, which marked a new way forward for the company. Sense and simplicity reflects Philips commitment to be a market-driven company that provides products and services that fulfill the promise of being designed around you, easy to experience and advanced. In 2008, the total estimated value of Philips brand increased by 8% to USD 8.3 billion and was ranked the 43rd most valuable brand in Inter brands 2008 ranking of best global brands 1.4 Corporate affairs In 2004, Philips abandoned the slogan "Let's make things better" in favour of a new one: "Sense and simplicity". Origin, now part of Atos Origin, is a former division of Philips. Its record division, Polygram, was sold to Seagram in 1998 to form Universal Music Group.

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Philips Intellectual Property and Standards, is the company's division dealing with licensing, trademark protection and patenting. Philips currently holds about 55,000 patent rights, 33,000 trademark registrations, and 49,000 design registrations. Major consumer electronics products 1951 Introduced the Philishave two-headed rotary shaver, marketed in the USA under the Norelco name. 1963 Introduced the Compact cassette. 1963 Introduced the first domestic home video tape recorder, the 405 line 1" tape reel model EL3400. 1978 Introduced the laserdisc player, using technology invented in the 1960s. 1978 Introduced the Philips Videopac G7000 (pictured at right), a home video game console developed by its Magnavox division. Marketed in the United States as the Odyssey console. Variations of the console are sold worldwide through 1984. 1979 Introduced the Video 2000-system: a technically superior design, but a commercial failure. 1982 Launched the Compact Disc in partnership with Sony. 1983 Participated in developing the MSX home computer standard. This computer standard was mainly popular in Japan and the Netherlands. 1991 Introduced the CD-i, the Compact Disc Interactive system which had many video-game console-type features, but was not a sales success. 1992 Launched the ill-fated Digital Compact Cassette format. 1995 Manufactured the Atari Jaguar's CD add-on for Atari. 1999 Launched the Super Audio CD in partnership with Sony.

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2000 - Launched the luminaries Iridium. 2001 Successfully launched the Senseo coffeemaker, first in the Netherlands and from 2002 onwards, in other countries across Europe. It produces coffee by brewing from custom-made pads containing coffee grounds. The original Senseo pads are produced by Douwe Egberts. The Senseo has been available in the US since 2004. 2004 Philips HomeLabs research center created the Mirror TV technology used in their MiraVision television line. 2006 Introduced the Blu-ray Disc in partnership with Sony. 2008 Introduced flatscreen with WOW VX technology. (3D tv) 2008 Introduced the Relationship Care range of Philips Intimate Massagers to the UK market. The company receives a royalty on every DVD manufactured. 2009 Introduced the Philips Cinema 21:9 TV in a widescreen mode for HDTVs with an LCD display using the aspect ratio. The Electrolux Group is a publicly-owned, Swedish manufacturer of home and professional appliances for cooking and cleaning. Electrolux products include white goods and vacuum cleaners sold under a variety of brand names, including its own. Forbes Magazine says Electrolux is one of the top 5 companies in consumer durable goods, worldwide, and named it to its list of 130 Global High Performers in 2010. Notable products 1919: The Lux vacuum is the first product Electrolux sold. 1925: D, Electrolux's first refrigerator, is an absorption model.

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1940: Assistant, the company's only wartime consumer product, is a mixer /food processor. 1951: W 20, Electrolux's first home washing machine, is manufactured in postWorld War II Gothenburg, Sweden. 1959: D 10, the company's first dishwasher, is a countertop model nicknamed "round jar". 1964: Luxomatic is a feature-filled vacuum cleaner that uses self-sealing paper dust bags. 2001: Launch of the Electrolux Trilobite, a robot vacuum cleaner. 2002: The Washy Talky 'talking' washing machine goes on sale in India.

CHAPTER 2 STRATEGY OF PHILIPS

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2.1 PHILIPS STRATEGY IN INDIA Philips India, is in a bid to aggressively push its sales in the rural/semi-urban segment and has designed an innovative strategy for these regions. Called the `Philips Mahasangram Integrated Marketing Programmes', the rural initiative will be taken across the country from July 2, focusing on rural towns with a population of less than 5,000 and semi-urban towns with a population between 5,000 and 50,000. , The Philips Mahasangram is aimed at taking Philips' new products to the semi-urban and rural customers and increasing their awareness where product knowledge, information and availability are concerned. An indication of the size of this initiative can be obtained from the fact that Philips will be spending about 4.5 per cent of its turnover from the rural/semi-urban areas on the Mahasangram alone. Meanwhile, the key reason behind this initiative lies in the growing potential of the rural market. According to industry data, while in 1997-98, rural sales formed about 25 per cent of the total sales for CTVs, refrigerators and washing machines, it increased to 36 per cent in 2001-2002 and is expected to go up to as high as 41 per cent in 2006-07. Apart from initiating new marketing and distribution programmes, Philips will also be launching a range of new products during the rural initiative. Meanwhile, Philips plans to implement an innovative FMCG style marketing strategy to push its durables in the rural segment. The Mahasangram Integrated Marketing Programme is essentially about implementing a non-durables strategy marketing in a consumer durable segment. The management is planning effective use of a number of media vehicles to ensure efficient communication of the message and maximum utilization of the money spent. The advertising and marketing strategy will be a combination of above-the-line and below-the-line/ on-ground activities. Various promotional activities which Philips plans to initiate during the Mahasangram include a series of on-ground activities such as point of sale material at retailers' counters, road-shows, mobile vans with Philips products on display and games, innovative tactics like advertising on an inland letter form or postcard (a popular form of communication in rural areas) and sponsorship of local events, among other things. On the distribution front, Philips claims to have the biggest distribution network (as VIVEK COLLEGE OF COMMERCE Page 8

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compared to other consumer electronics companies) and a high degree of penetration even in the rural and semi-urban areas. The company has carried out an extensive product-wise mapping exercise over 540 districts across India. Keeping in mind the objective of extensive physical reach of 80 per cent plus, where portable audio is concerned, the company has developed a second line of activity in the distribution set-up. Also, in order to cater to volume drivers i.e., major retailers, company has identified the main retailers of each distributor and practice the Key Account Management Approach with them, so that there is a focus on improving relations, trade with these retailers, and catering to their needs. These steps have helped in developing their volume reach, geographical reach and counter share significantly. Philips is hoping that its innovative rural marketing initiative coupled with the high growth in the rural market will boost its market share. 2.2 PHILIPS IN INDIA Philips started operations in India at Kolkata (Calcutta) in 1930 under the name Philips Electrical Co. (India) Pvt Ltd, comprising a staff of 75. It was a sales outlet for Philips lamps imported from overseas. In 1938,Philips India set up its first Indian lamp-manufacturing factory in Kolkata. After the Second World War in 1948, Philips started manufacturing radios in Kolkata. In 1959, a second radio factory is established near Pune.

In 1957, the company is converted into a public limited company, renamed "Philips India Ltd".

In 1965 on 3 April, the millionth Philips radio is manufactured in India. In 1970 a new consumer electronics factory is started in Pimpri near Pune. (This factory was shut down in 2006.)

In 1982, Philips brought colour television transmission to India with the supply of four outdoor broadcast vans to DD National during the IX Asian Games.

In 1996, the Philips Software Centre was established in Bangalore (It is now called the Philips Innovation Campus).

In 2008, Philips India entered a new product category, water purifiers designed and made in India, and exported to other countries.

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As of 2008, Philips India has about 4,000 employees

2.3 How Philips India doubled its sales The company launched an aggressive new advertising campaign in print, television and online. The new tagline "Sense and simplicity" showcases the new brand promises -- using technology to make life simpler and easier. Company sources say Philips is counting on the new campaign to help it grow by at least 25 per cent this year. That's in the future, but how did Philips almost double its market share in under four years? Interestingly, the company didn't adopt radically different strategies. It paid attention to what customers wanted; passed on cost benefits; and brushed up its admittedly fuddy-duddy image. According to Mr. D Shivkumar, executive director, consumer electronics, Philips, "We have managed to grow the business by focusing on the price -- quality equation.

2.4 Global Footprint Philips is a global leader across its healthcare, lighting and lifestyle portfolio:

The worlds largest home healthcare company, being number one in:

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Monitoring

systems,

Automated

External

Defibrillators,

Cardiac

Ultrasound, Cardiovascular X-ray. Nnumber 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.

Nnumber one in the electric shavers and male grooming category globally. Philips is one of the leading flat-TV brands globally.

2.5 MARKETING STRATEGY The marketing strategies for any company are not about a fixed concept. Rather it is full of new challenges every day, and the companies must respond to it very positively. The market process is applicable to more than goods and services. Anything related to market including ideas, events, policies, prices and personalities comes under market strategy. However it is important to emphasize opportunity in the market through market strategy. The following strategies are basically adopted by Britannia in order to capture a good market share.

A strong quality of the product and customer satisfaction: Generally customers are concerned about the quality of product as well as the price of the product . In my survey i found that basically people are first looking for the quality. If good quality is there in the product then they are only looking for the price. But if the quality is not satisfactory they even dont looking about the pricing of the product. In this regard Philips always maintained much more importance over there product quality. Thats why they are among the very successful brand of today. A growing relationship with customer and customer retention:

Nowadays a good relation with the customer is very important for organization. Sale is totally depending on the relation with the customers. Customer's retention is also a VIVEK COLLEGE OF COMMERCE Page 11

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major aspect for growing business. It means keep the old customer and try to make new customer. Philips customer relationship management is very strong which is the one of the major cause of selling of their product continuously.

Focus on competitors activity: Every organization must be careful about it's competitors step, because they can disturb the growing sales process of the organization. Continuous watching over competitors strategies and development will help Philips.to think better and to take major steps to sustain in the market

A growing emphasis on global thinking and local marketing planning: Companies are increasing by pursuing market beyond their borders. When they enter other countries they must follow the tradition of that country and also they make plan for local market that which type of product has more demand and how can it run in the market. For Philips their different variation in their product and pricing strategy will help them to sustain in the market

2.6 PROMOTIONAL STRATEGY Under the market strategy promotional idea is very important. Organization provides some schemes or rebates to retailers or consumers. They make advertisement according to convenient of the people and the feature of VIVEK COLLEGE OF COMMERCE Page 12

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the product. Sometimes Philips should comer to market with new offerings at the time of festivals and of course with cost benefits to the customers. Giving discounts over bulk purchase also comes under this strategy. This strategy will Philips to increase their market size as well as the share and this will help to generate more and more revenue BRAND POSITIONING With different various products Philips has a very strong position in the mind of consumer that they provide good quality products which suits their budget. COMPETITORS Generally all organizations have competitors in the market. A particular organizational comprises with other same business and according to market share i clarify the brand of product is giving more challenge to my product.

I found many products which can be compared with Philips products. As aconclusion i found that particularly in the area i surveyed Philips is really doing well and its performance is on a satisfactory level but as far as the competitors is concern they are growing at a rapid speed a capturing the market of Philips.

During the field work and after intensive study it was found that main competitor of Philips are :HAVELLS BAJAJ CROMPTON 2.7 MARKET POTENTIAL Market potential of the PHILIPS is much positive in competitive era and will sure cover the maximum market share of electric product. Potentiality of any product VIVEK COLLEGE OF COMMERCE Page 13

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depends upon the futuristic performance of the product. it depends that how much retailers have potentiality to be permanent seller of PHILIPS. For great potentiality it is necessary to improve those factors which are going to effect retailers. In my study I found some factors which can help to cover great potentiality. These factors are following: Scheme delivery should in perfect determining time. Some places distributors not able to cover such as (Jankipuram 60 ft road, aishbagh).That should be improved. Scheme facility should be regular as much as possible. Cash discount should be provided when a retailer purchase in bulk in cash payment so that the working capital circulate from both end and this activity will help to generate more potential retailers. Always collect the views of retailers. It gives psychological effect on the retailers about careness by manufacturing company. If we do not consider retailers point of view then who will sell our products.?

These factors are very important for the organization. If company is able to improve these all factors then definitely its market share will more increase. Retailers will take more interest to sell Philips product and customer will also enjoy for it. .

CHAPTER 4 EXPORT MARKETING-4PS

ELECTRIC MARKET FROM 4 PS OF MARKETING

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PRODUCT:-

Philips deals in good quality of electric products,right from its beginning and provide customer a valuable product and maintain a good relationship with their retailers and customers. They give first priority to the customers and due to this they are the market leader from last 8 years..But from last few years Philips is facing stiff competition from their competitor (Bajaj,Crompton,Havells) in terms of product range as well as the quality of products & they are capturing the market of Philips at a rapid speed

PRICE:-

Philips use the strategy of Skimming Pricing to promote their products with this thing in mind costlier the better thats why all Philips products are costlier as compare to their competitor but from last few years others companys are also providing the better quality products at low cost and more warranty on their products as compare to the Philips.

PLACE:-

Philips uses the word of mouth promotion strategy because of the literacy rate is low as compare to other metro cities of INDIA.

PROMOTION:-

Promotion is an important tool for any company to survive in any national or domestic market & to promote their products Philips use word of mouth strategy which is not sufficient to capture a bigger market. To capture the bigger market Philips should go for Window Dressing, Hoardings, Offer on new products in order to capture a bigger market. During the whole survey of 60 days I havent found any board, hoardings, display board at any retail counter whereas other comapnys do so and increasing their market size day by day and this is the biggest threat for Philips and this will result to lose the market share VIVEK COLLEGE OF COMMERCE Page 15

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CHAPTER 5 PRODUCTS AND SERVICES

3.1 PRODUCTS AND SERVICES Philips being a market leader in electronic consumer durables and consumer non VIVEK COLLEGE OF COMMERCE Page 16

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durables, has a wide range of products under the following headsHealthcare Philips simplifies healthcare by focusing on the people in the entire cycle of care - whether it is in the hospital or in the home patients and care providers. Philips Healthcare in India operates in the diagnostic imaging segment including CT, MRI, X-rays, cardiovascular system, nuclear medicine, PET-CT, and ultrasound imaging systems, and is also a significant player in patient monitoring. Recently, Philips Healthcare announced its entry into the fast-growing Indian home healthcare market by introducing the Philips Respironics product categories in obstructive sleep apnea management and home respiratory care. Through combining human insights and clinical expertise, Philips aims to improve patient outcomes while lowering the burden on the healthcare system. Outstanding image quality and reliability, backed by an excellent application, and customer support network, has made Philips Healthcare a preferred choice of clinicians and one of the leading suppliers of diagnostic imaging systems. Philips is the clear leader in cathlabs segment with the most comprehensive range of innovative cardiology solutions in India. With a strong focus to drive growth from emerging markets, Philips Healthcare announced the first patient monitor designed for emerging markets, Philips SureSigns VM3, in India. This series of new portable, compact patient monitors provides a reliable, yet affordable means to observe and care for patients. With the acquisition of India-based Alpha X-Ray Technologies and Meditronics, Philips also expanded its healthcare business to cater to the high-growth economy segment for Cardiovascular and General X-Ray systems.

Lighting Philips Electronics India, Indias largest lighting company operates in business areas of Lamps, Luminaires, Lighting Electronics, Automotive and Special Lighting. Today, as global leader in Lighting, Philips is driving the switch to energy-efficient solutions. With worldwide electrical lighting using 19 per cent of all electricity, the use of energy-efficient lighting will significantly reduce VIVEK COLLEGE OF COMMERCE Page 17

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energy consumption around the world and thereby cut harmful CO2 emissions. Philips India has been consistently working with industry bodies such as ELCOMA, Bureau of energy efficiency and NGOs towards addressing Indias power crisis through promotion of energy efficient lighting in India. Philips provides advanced energy-efficient solutions for all segments: road lighting, office & industrial, hospitality and home. Philips is also a leader in shaping the future with exciting new lighting applications and technologies such as LED technology, which, besides energy efficiency, provides attractive benefits and endless new never-before-possible lighting solutions. In 2008, Philips inaugurated a global research and development (R&D) centre for lighting electronics in India. This was its third such unit in the world. The facility which is situated in Noida will not only cater to the needs of the Indian market but also the Asia-Pacific, Europe and North America. The other R&D centres are located at Eindhoven in the Netherlands and in Shanghai, China. One of the primary research areas for the centre is to develop products that can tackle high voltage fluctuations in India. The centre currently employs 35 engineers. Around 40 per cent of Philips revenue in India comes from the lighting business. ConsumerLifestyle 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 individuals interests in terms of their mind, space, body and appearance The Consumer Lifestyle arm in India operates in the business areas of Home Entertainment solutions and Personal Infotainment with product categories such as TVs, home theatre systems, music systems, DVD players, personal entertainment solutions, sound accessories, Domestic Appliances and Personal care.

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Sound and Vision The Philips GoGear with FullSound was created to enhance the sound quality of your MP3 music while you play it. Now you can experience your music on the go as never before. Includes product range in Televisions Home Theatres Blu- Ray And DVDs Audio Products MP3 And Media Players Portable TV And DVD Digital Photo

House Hold Products Includes the range in Coffee Makers And Kettles Irons Juicers and Blenders Food Preparation Water And Air Purifiers

PC Products and Phones Web Cams And Head Sets Monitors PC Audio Page 19

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Drivers And Storage Mice And Key Boards

Accessories Phone Accessories Audio/ Video Accessories MP3 Players Accessories Head Phone Remote Controls Mother And Child Care Power Solutions

Personal Care This includes Mens Shaving Mens grooming Female depilation Hair care

SERVICES Philips products have reached millions of consumers in India. Products discarded by consumers turn into electronic waste. This E-Waste is hazardous for the environment, and to human health. Efforts are needed to dispose off these products in an environment friendly manner. Philips India has initiated a voluntary take back and recycle program. 3.2 Philips E-waste Management Program in India Philips has tied up with a recycler for collecting, transporting and recycling VIVEK COLLEGE OF COMMERCE Page 20

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unwanted / broken down consumer products. At Philips we offer consumers a convenient way of recycling their unwanted, obsolete and damaged Philips products by dropping them off at convenient locations. The program encompasses 8 major cities across India. Consumers can approach one of 27 authorized Philips service centres, which will act as collection points for consumer products which need recycling. Our efforts are to expand the network in the near future. Philips ensures that the consumer products received will be recycled in an environment-friendly manner. Philips understands the corporate social

responsibility and takes steps towards providing a safer environment to the future generations. We design our products to continuously realize improvements and reduce their overall life cycle environmental impact. Designing products for recycling is an integral part of this approach. Our aim is to use our planets limited resources effectively and respect the principle of extended producer responsibility. This also calls for manufacturers to engage in developing solutions for effective and efficient recycling of their products. We will continue to promote and invest into improved recycling systems to reduce the impact of electronic waste on the environment

3.3PRODUCT DETAIL

Philips India ltd. is the Indian counterpart of Royal Philips Electronics. Originally established Electrical Co. (India) Pvt. Ltd, Philips was born in India in Kolkata in 1930. With the tag line of VIVEK COLLEGE OF COMMERCE Page 21

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Simplicity", Philips is introduced to the Consumer as a Company that adheres to its promise of

Products and Services that make lives simpler and easier. Philips enjoys the position of a househo

Consumer Products In India. Any of the Appliance or Electronic item can be purchased from a Phi or Outlet.

The Consumer Products range of Philips include: - LCD, Plasma, Flat Screen , Smart Touch XL

Products - Audio Systems, Remote Controls, Audio/Video Accessories

- Mouse and Keyboard, Multi Media Headsets, External Hard Disk Drives.

- Dry Shavers, Beard Trimmers - Beauty and Hair Care Products

- Blenders and Hand Blenders, Juicers and Citruspresses, Food Processors a Coffee Makers and Kettles, Frying and Grilling Appliances, Toasters and Snacking Products - Irons, Vacuum Cleaners, Water Purifiers .Philips is a name synonymous

In India. The Lighting solutions by Philips are aimed at providing state-of-art lighting technology

with costeffectiveness. These lighting products have applications in not just Homes but also Ind infrastructure based settings. The Philips Lighting Solutions cover the following spheres:

- Industrial, Shops and offices, Road and Area, Hospitality, Sports Lig Beautification, Philipsools and Petrol Stations

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- In Cars, Motorcycles and Trucks

The Annual Reports of the Company show considerable growth owing to a well planned and

Research and Development System. Philips India Ltd. has Offices in all the major cities in In Kolkata, Chennai, New Delhi, Bangalore, Pune and Gurgaon.

The Corporate Office is situated at Mumbai. The CEO of Philips Electronics India Limit

Ramachandran, along with the Chairman, Mr. S.M. Datta and the entire team of directors has been in taking Philips to new heights in Indian Consumer Appliances Market.

Juicer: HR1861/00 700W - Dishwasher-safe - Extra large capacity - Extra large feeding tube Juicer Mixer Grinder: 2 jar - Auto shut-off - Compact design for less sto ... - Easy to pour and store Mixer Grinder HR1651 3 jar 750W - 750 W powerful motor

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- Auto shut-off - Intelli control timer Iron Pressurised steam ge... GC8220 - 1.4 liter water tank - Up to 4.5 bars steam pressu ... - Steam tip Steam iron GC4420 - Up to 40 g/min of steam - Steam tip - Automatic safety shut-off Travel iron GC650 - Steam boost - Vertical steam - Carry pouch Mens Shaving: Electric shaver RQ1280 Chrome - GyroFlex 3D - UltraTrack - Patented Super Lift&Cut Act ... Electric shaver HQ130

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- Unique Lift & Cut dual blad ... - Individually floating heads - Up to 60 minutes cordless s ...

Hair Care Hairdryer HP8202 - Ion conditioning - 1600W - EHD+ technology Lady Shaver: Epilator HP6609 Total body - Opti-start cap with massage - Lift and massage attachment

- Sensitive cap

3.4 ACQUISITIONS, SUBSIDIARIES AND SPINOUTS AcquisitionsCompanies acquired by Philips through the years

include Amperex, Magnavox

Mullard, VLSI, Agilent Healthcare Solutions Group, Marconi Medical Systems, ADAC

Ultrasound, portions of Westinghouse and the consumer electronics operations of Philco and Sylva

abandoned the Sylvania trademark which is now owned by SLI (Sylvania Lighting International

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Australia, Canada, Mexico, New Zealand, Puerto Rico and the USA where it is owned by the

of Siemens. Formed in November 1999 as a equal joint venture between Philips and Agilent Te

the light-emitting diode manufacturer Lumileds became a subsidiary of Phillips Lighting in Augus a fully-owned subsidiary in December 2006. In 2000, Philips bought Optiva Corporation,

of Sonicare electric toothbrushes. The company was renamed Philips Oral Healthcare and made a of Philips DAP. In 2006 Philips bought out the company Lifeline

Systems hea

in Framingham, Massachusetts. In August 2007 Philips acquired the company Ximis, Inc. headqua

Paso, TX for their Medical Informatics Division. In October 2007, it purchased a Moore Mic Patent (MPP) Portfolio license from The TPL Group. On Friday, 21 December 2007 Philips and Respironics, Inc. announced a definitive merger

pursuant to which Philips will commence a tender offer to acquire all of the outstanding shares of R

for US$66 per share, or a total purchase price of approximately 3.6 billion (US$5.1 billion) to be p upon completion.

SpinoutsPolymer Vision, the maker of The Readius is a spin out from Philips Electronics. APRICO Solutions is a venture within Philips Intellectual Property and Standards.

Philips also forayed into the pharmaceuticals market in a company best known as Philips-Dup

Pharmaceuticals). Philips-Duphar made products for crop protection, veterinary medicine and p

human use. Duphar was sold to Solvay, now Solvay Pharmaceuticals. In subsequent years division

sold off, by Solvay, to other companies (crop protection was sold to UniRoyal, now Chemt veterinary division was sold to Fort Dodge, a division of Wyeth).

3.5 SPORTS, SPONSORSHIP AND NAMING RIGHTS

Traditionally Philips has a vested interest in sports, originally as a means to provide a health

recreation for its employees. In 1913, in celebration of the Centenary of Dutch independence fr

Philips founded a sports club called Philips Sport Vereniging (Philips Sports Club), or PSV, a

known. The sports club encompasses all kinds of sports, but is currently most famous for its Prem

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football team and its swimming team. Philips owns the naming rights to Philips Stadiu in Eindhoven, which is home to Dutch football team PSV Eindhoven.

Abroad, Philips sponsors and has sponsored numerous sport clubs, sport facilities, and events. Phil (November 2008) extended its very successful F1 partnership with AT&T Williams to include product groups. Furthermore, Philips owns the naming rights to the Philips Arena in Atlanta, Georgia and to Championship, the premier basketball league in Australia, traditionally known as the National

League. Between 1988 and 1993 Philips were also the major sponsors of The Balmain Tigers, an rugby league team. In Thailand Philips is a sponsor of PEA FC. Outside of sports Philips sponsors the Philips Monsters of Rock festival, held in many countries world

3.6 Challenges Facing the Consumer Electronics Industry

With the increase in price wars due to the entry of new players in the market and increase in manuf

capacity by some original manufacturers, the profitability and margins of the companies are advers

affected. Poor distribution network in semi-urban and rural areas. Low awareness of consumer elec

products in rural India. Presence of gray market in consumer electronics products, especially in DV

music players. Companies need to increase focus on product differentiation to address various segm specific needs.

With the increase in access to Internet information, and availability of wide range of choices, cons

become quite smart. They want the product that is easy-to-handle, good in quality and low in p importantly, consumers want some guarantee for the product that they are buying. They look for

that can be used for many years. The role of electronic companies doesn't end on the sale of the p continues till the end of guarantee

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CHAPTER 5 PEST ANALYSIS

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Mission statement The Philips Inc. is a company with 115 years of history. It has made its way from a small carbon-filament lamps producer to the one of the world's biggest electronics companies. A mission the company was devoted to all this years improving the quality of people's lives through the timely introduction of meaningful technological innovations. (Phillips, 2007) The mission statement shows that the business of the company is developing new technologies which can be used in day to day life in order to make it easier and more comfortable. It is also clearly seen from the mission that the customers of the company are mostly individuals, who buy the product for their own use. According to the statement the customer should probably be seeing the company as a provider of advanced and user friendly technology that improves their lives. The business will be providing solutions in the areas of healthcare, lifestyle and enabling technology and should be the most admired company in the industry. PEST Analysis of Philips company

All business entities are under the pressure of different factors inside and outside the organization. In order to survive in the global environment, companies in building their strategies have to aware of the outside forces such as political and economic situation inside the country and in the global community, new technologies in the market, socio and cultural influences.

1.POLITICAL FACTORS Political factors that affect the activity of an organization are: tax policy, employment laws, environmental regulations, trade restrictions and political stability inside the country. As company maintains sales and service organizations as well as manufacturing operations in many different countries it must deal with a great variety of laws and policies, which additionally change all the time. For VIVEK COLLEGE OF COMMERCE Page 29

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example in many countries of European union now taking place dynamic changes in employment law.(Federation of European employees, 2007) Also many countries are now environment concerned and try to reduce pollution. Philips as a large manufacturer can face some problems because of that. 2.ECONOMIC FACTORS At the present time a lot of countries where Philips Company has its business are experiencing high levels of economic growth at the moment. For example according to bbc.co.uk, the economy of the country grew at the fastest rate for two years in the second quarter of 2006 and as it was reported by Office for National Statistics (ONS) reached 2.6% in August 2006. Inflation rate has increased to 2.5% in June 2006; however, the average inflation in 2006 is likely to around 3% that is normal for UK. Because of the high economic growth inflation and interest rates are likely to rise. In 2006 the Bank of England kept the interest rate at 4.5%. For Philips high economic growth means the increasing purchasing power of the population that is desirable for the company. 3.SOCIO-CULTURAL FACTORS: The social and cultural influences on business vary from country to country, region to region. It is very important that such factors are considered. Philips operates in many countries therefore they are in vast and diverse sociocultural arena. It is important for Philips to adapt to these changes in customers expectations from region to region and being able to cater according to them. People in developed countries now also start to pay more attention to the culture of a company, and that fact that Philips is a highly ethical company, which cares about its customers and suppliers will win them more respect from people. Another point about social factor is that people in many countries become wealthier so more now will be able to afford prices of new technology. 4.TECHNOLOGICAL FACTORS: Technology is vital for competitive advantage, and is a major driver of VIVEK COLLEGE OF COMMERCE Page 30

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globalization. The main benefits of a better technology are that it allows cheaper and better standard of quality for products and services. It also offers to consumers and businesses more innovative products and services such as Internet banking, new generation mobile telephones, etc. Philips Company is very dependant on technology. New innovations can significantly improve operations of the company. On the other side if competitors of the company will become more technologically advanced Philips can loose its market share.

CHAPTER 6 SWOT ANALYSIS

6.1 SWOT Analysis of Philips Every company faces few challenges and weaknesses in its existence, therefore, to know companys strengths and opportunities is desirable to overcome any difficulties that may arise and successfully predict any trends. SWOT Analysis is a marketing tool that gathers and analyse these information about the company. With help of SWOT, which stands for Strengths Weaknesses, Opportunities and Threats, Philips would know how to deliver their products and right services to its

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customers effectively.(Kotler, P. 2005) 1.INTERNAL STRENGTHS: Philips has a recognizable and very strong brand image that was established thorough the years. The core values and the whole icon of Philips are based on the quality, value for money, innovation, and superiority of the service and on the trust. The product range is wide, modern and of good quality. Philips products and solutions are known to be advanced, easy to use, and designed to meet the needs of all users. Company also has strong intellectual property position as it has a lot of widely used technologies patented as their own innovation. Philipss another strength is operations excellence and flexibility of the firm, which helps it to deal with changes. Well built customer and supplier relationships also help the company. Philips is the worlds leading lighting supplier. Strategic alliances are an important part of business at Philips. They enable us to bring new products to the market that we would not have been able to develop on our own. Philips combines with a number of leading global companies to build advanced products and services that touch the lives of people everyday.

2.INTERNAL WEAKNESSES: Philips Inc. operates in fields where competitiveness is very concentrated. However it has strong customer base it should not underestimate the emerging customers; it should keep up with new trends and updating the existing products, actively listen new proposals from customers and staff and continue to promote its brand image via effective advertisements. Another weakness is that Philips employs a huge number of people which work in a variety of different countries. Therefore the company experiences some problems in sharing information between employees and controlling operations of different VIVEK COLLEGE OF COMMERCE Page 32

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businesses. New, efficient and less complicated ways of transmitting information between the stores, manufacturing premises, head office and various departments should take place in order to communicate successfully and deliver the most effective customer service.(Philips Company, 2007) 3.EXTERNAL OPPORTUNITIES: Philips continuously explores new ways to improve products and to offer innovative products to its consumers. It have created a program through which higher and higher quality levels in all products and services will be reached. Technological products of Philips can be more design oriented.Creating jolly, modern and convenient stores with place to rest and have a coffer is another project, which Philips can undertake.Redevelopment will create good atmosphere in the stores, the changes would encourage customer to stay longer in the stores. 4.EXTERNAL THREATS: More retailers have understood where the market trends are going; quality, value is the key in today retail sector. Many companies started to produce the same quality products on a cheaper price. Another challenge that not only Philips faces is fast changing environment, where new products are introduced within small space of time. Therefore, keeping track with new trends and products is essential for the business. Spending habits and way how people shop is changing rapidly. People shop more on line, looking for promotions or wait until the sale period. Therefore, improve on-line facilities; friendlier web page would boost the sale and maintaining small promotions in the stores would invite higher number of visitors into the stores.

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CHAPTER 7 PROBLEMS
1.7 PRESENT PROBLEMS / DIFFICULTIES FACED BY INDIAN EXPORTERS

At present, Indian exporters face a number of problems /difficulties. The problem demotivates the business firms to enter into foreign markets. These problem / difficulties are as follows.

a) Recession in world market : The world market, faced recession in 2008 and in the firsthalf of 2009. The VIVEK COLLEGE OF COMMERCE Page 34

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recession was triggered due to sub-prime crisis of USA in September 2007. Due to recession, the demand for severalIndian items such as Gems and Jewellery, Textiles and Clothingand other items were badly hit. During recession, exporters get loworders from overseas markets, and they have to quote lower prices.Therefore, exporter gets law profits or suffers from losses.

b) Technological differences: The developed countries are equipped with sophisticatedtechnologies capable of transforming raw materials into finishedgoods on a large scale. Less developed countries, on the other hand, lack technical knowledge and latest equipments. Andtherefore they have to use their old and outdated technologies. Itleads to the lopsided development in the international market.

c) Reduction in export Incentives: Over the years, the Govt. of India has reduced exportincentives such as reduction in DBK rates, withdrawal of income taxbenefits for majority of exporters, etc. The reduction in exportincentives demotivates exporters to export in the overseas markets.

d) Several competitions in global marketing: Export marketing is highly competitive. This competitionrelates to price, quality, production cost and sales promotiontechniques used. Indian exporters face threefaced competitionwhile exporting. This includes competition from domestic exporters,local producers where the goods are being exported and finallyfrom producers of competing countries at global level. Suchcompetition is one special problem to the exporters.

e) Problem of product standards: Developed countries insist on high product standards fromdeveloping countries like India. The products from developingcountries like India are subject to product tests in the importingcountries. At times, the importing countries do not allow

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imports of certain items like fruits, textiles and other items on the grounds of excessive toxic content. Therefore Indian exporters lose marketsespecially in developed countries.

f) Fluctuations in Exchange Rate: Every country has its own currency which is different frominternational currencies. The dominant international currencies areUS dollar or Sterling Pound. From the point of view of Indianexporters we are interested to realize the payment in internationalcurrency. Foreign exchange earned by the operators is convertedinto Indian rupees and paid to the exporters in Indian currency; thisexposes the exporters to the dangers of fluctuation in foreignexchange rates.

g) Problems of Sea Pirates Attacks: A major risk faced by international trade is attack by pirates in the Gulf of Aden. More than half of Indias merchandise trade passes through the piracy infested Gulf of Aden. New exportersand importers are facing problem, because of increased pirateattacks as they find it difficult to get insurance cover.

h) Problem of subsidies by Developed countries: The developed countries like USA provide huge subsidies totheir exporters. For example, in case of agriculture exporters, USA,UK and other provide huge subsidies to their exporters. Therefore,the exporters of developing countries like India find it difficult to facecompetition in the world markets.

i) Problem in preparing Documents Export involves a large number of documents. The exporter will have to arrange export documents required in his country andalso all the documents as mentioned in the documentary letter of credit. In India, there are as many as 25 documents (16 commercialand a regulatory documents) to be filled in.

j) Government restrictions and foreign exchange regulations The Government restrictions compel the exporters to followcertain rules and

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regulations in the form of licenses, quotas, andcustoms formalities. Due to such restrictions, new problemsdevelop before the exporters. Even trade restrictions in foreigncountries create problems before exporters. Indian exporters facethis difficulty of government restrictions and foreign exchangeregulations even when trade policy is now made substantiallyliberal.

k) High risk and Uncertainties

Export marketing is subject to high risks and uncertainties.The risks may be both political and commercial. Political risksinvolve government instability, war, civil disturbances, etc. Thecommercial risks involve insolvency of the buyer, protracted defaulton the part of the buyer dispute on quality and so on.

l) Competition from China India is facing stiff competition from China in the worldmarkets, especially in the OECD markets. As a result, Indias share of export of OECD markets has declined from 53% of total exportsin 2000-01 to about 38% in 2007-08. Some of the Indian exportershave lost their overseas contracts due to cheap Chinese goods andsupplies. This is the major problem of exporters.

CHAPTER 8 CONCLUSION

The conclusion that can be derived from this survey is that Philips being a big brand, and a quality striver is hit by the low- cost rivals. But the segment it caters is highly satisfied and constitutes immense Brand Loyal. To boost its sales the company may need to adopt, certain measures for its repositioning and can adopt differentiation strategies and proper distribution of their products including schemes and post sales services for the consumers in Indore region and turning low cost itself for the rest. VIVEK COLLEGE OF COMMERCE Page 37

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Philips is the largest electronics company in the world. They made a positive transformation over the years and became market leader. The company has been profitable over the last couple years except in years of global recession

CHAPTER 9 WEBLIOGRAPHY

www.india.philips.com

http://www.india.philips.com/about/company/india/index.page

http://en.wikipedia.org/wiki/File:Philips_logo_new.svg

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http://www.india.philips.com/about/sustainability/index.page

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