Microwave Marketing
CASE 1 4 Marketing Microwave Ovens to a New
Market Segment
You are the Vice President of International Marketing for White Appliances, an international company that manufactures and markets appliances globally. The company has a line of microwave ovens— some manufactured in the United States and some in Asia—which are exported to the U.S. market and Europe. Your company markets several high-end models in India that are manufactured in the United States. Your presence in the Indian market is limited at this time. White Appliances has traditionally sold to the high-income segment of the Indian market. However, India is in the midst of a consumer boom for everything from soda pop to scooters to kitchen appliances. Demand for microwave ovens jumped 27 percent in two years amid surging demand for kitchen conveniences. Sales have been spurred by declining import tariffs and rising salaries, as well as the influx of companies reaching to all ends of the market. India has about 17 million households—or 90 million people that belong to the country’s middle class, earning between $4,500 and $22,000 annually. Another 287 million are “aspirers,” those that hope to join the middle class. Their household income is between $2,000 and $4,500. In 2010, these two groups combined number 561 million. Furthermore, significant numbers of Indians in America are repatriating to their homeland and taking their American spending habits and expectations back home with them. After preliminary analysis, you and your team have come to the conclusion that in addition to the market for high-end models, a market for microwave ovens at all price levels exists. Several international companies like Samsung, Whirlpool, and LG Electronics India are entering the market with the idea that demand can be expanded with the right product at the right price. There are, however, several challenges in the Indian market, not the least of which is the consumer’s knowledge about microwaves and the manner in
Market Segment
You are the Vice President of International Marketing for White Appliances, an international company that manufactures and markets appliances globally. The company has a line of microwave ovens— some manufactured in the United States and some in Asia—which are exported to the U.S. market and Europe. Your company markets several high-end models in India that are manufactured in the United States. Your presence in the Indian market is limited at this time. White Appliances has traditionally sold to the high-income segment of the Indian market. However, India is in the midst of a consumer boom for everything from soda pop to scooters to kitchen appliances. Demand for microwave ovens jumped 27 percent in two years amid surging demand for kitchen conveniences. Sales have been spurred by declining import tariffs and rising salaries, as well as the influx of companies reaching to all ends of the market. India has about 17 million households—or 90 million people that belong to the country’s middle class, earning between $4,500 and $22,000 annually. Another 287 million are “aspirers,” those that hope to join the middle class. Their household income is between $2,000 and $4,500. In 2010, these two groups combined number 561 million. Furthermore, significant numbers of Indians in America are repatriating to their homeland and taking their American spending habits and expectations back home with them. After preliminary analysis, you and your team have come to the conclusion that in addition to the market for high-end models, a market for microwave ovens at all price levels exists. Several international companies like Samsung, Whirlpool, and LG Electronics India are entering the market with the idea that demand can be expanded with the right product at the right price. There are, however, several challenges in the Indian market, not the least of which is the consumer’s knowledge about microwaves and the manner in