Smartphone

Executive Summary

Celkon has entered into handset market in 2010 and within 3 years it has become the third largest handset manufacturer in India. In this period, it has focused mainly on youth and rural market and has become a leader in the same. Now it wants to expand its presence within India and then on international level. This plan incorporates innovative strategies that will utilize opportunities and address weaknesses as outlined in the Situation Analysis.

The plan addresses following marketing challenges:

* To position in the mind of customers as their preferred brand * To concentrate more on potential urban and youth market * To make a global presence in the market

Situation Analysis
Analyzing current situation through 4C framework:

Customers
Currently Celkon is dominating the South India mobile market. The marketing strategy of Celkon was to target youth. They are basically catering to the need of the customers of this segment.
For example the first mobile Celkon introduced was having the battery backup, movie storage etc....

Competitors
Celkon knows that there are many established brands in Mobile Phones’ industry like Samsung, Nokia, Apple, LG and several other local as well as Chinese manufacturers . Some major competitors and their strategy and strengths are identified as below:

SAMSUNG – Samsung has emerged as a very healthy and prominent competitor in the market. Samsung is backed with the high quality and professional team in the R&D area. Innovative products specially smart phones and Galaxy series from Samsung are ruling in the market. So it is expected that with the increasing demand of mobile phones Samsung will try to retain and increase its market share.

NOKIA – Nokia is the leader in the mobile phone industry in India. It is dominating the Indian market from years. Recently it is facing problems to retain its growth and sales. But the pioneer is working hard to get out of this. For the same reason Nokia is using the operating system of software biggie Microsoft. So it is expected that Nokia will try to regain its lost market share.

APPLE – Apple is one of the most major competitors in this industry. Slick, stylish and innovative phones of Apple are driving crazy to its users. Apple is aggressively entering Indian market with its amazing iPhone series.

Other domestic players – Other players like Micromax, Lava, Karbon, Spiceetc... have more or less the same market strategy.

Chinese manufacturers – Some of the Chinese manufacturers have already entered the Indian market. These manufacturers have priced their mobiles very low. So these manufacturers are expected to grow as with the demand. Various comparative analyses show that the market shares of Nokia fell drastically while that of Samsung rose impressively. Besides Samsung’s growth, market also witnessed the growth of the local manufacturers.

Company

Celkon is one of leading manufacturing companies in India. We have pioneered mobile phone solutions and wireless technologies in India. Celkon caters to the increasing smart needs of mobile users across the world.Our forte lies in providing innovative mobile technology to every customer. At Celkon, we believe every user needs an experience more personalized than ever. We are dedicated towards manufacturing customized user friendly phones. Our value added feature ensure the personality of the phone matches the taste of the user.The wide range of products available at Celkon ensures that there is a phone for every pocket. Every Celkon product undergoes stringent quality tests at every stage of production.Our main focus is to excel and provide the user with best designs paired with unmatched technology

Context
India is the second largest and the fastest growing telecom market in the world in terms of number of wireless connections, according to the Telecom Regulatory Authority of India (the "TRAI"). Currently around 650 million handsets are sold annually. By 2015, it is expected to grow to around 808 million handsets.

While wireless penetration in urban areas has increased significantly over the last few years, rural and semi-urban areas continue to be under-penetrated. The medium ASP segment is likely to be the fastest growing with 808 million handsets in 2014
Market opportunities and issues

The Indian mobile handset market is expected to grow from a total of 620 million handsets for the twelve month period ended December 31, 2014 to 808 million handsets for the twelve month period ended December 31, 2015.
The growth in the Indian mobile handset market is likely to be driven by the replacement handset market rather than new user additions. Within the replacement handset market, the medium ASP (Application Service Provider) device market is likely to grow the fastest.

4G business: 4G service is an emerging technology in India. 4G technology provides growth opportunities through multiple avenues including up gradation to 4G compatible mobile handsets and mobile data cards.
Value added services: Going forward, the demand for more sophisticated and innovative e-mail and multimedia based services, as well as gaming, music and video related offerings is likely to fuel growth in VAS. We believe the advent of 4G will also add impetus to the growth of the VAS market due to 4G's faster network capabilities.

Indian Mobile Handset Growth Projection by Range of Budget (Handsets in millions)

SWOT Analysis

* Strengths:

Innovative products and features- Cheaper version of Smartphone with vast range of applications, large screen size, etc... are some of the features which have increased the popularity of the product.
Low cost of production – With its plants located in China, Celkon bears a low cost in production due to availability of labour at cheaper rates.
Effective promotion campaigns- Celkon has been promoting its products through famous celebrities (Virat Kohli & Tamana).

* Weaknesses:

Weak brand image in urban areas- Celkon has still not been able to establish itself well in the urban market as its main concentration had been on the rural population.
Perception of low-quality Chinese brand- Celkon has a manufacturing unit set up in china which has strengthened this perception among people.

* Opportunities:

Increase penetration in urban market- Since Celkon has not yet entered this market; it has a very huge opportunity to establish itself in this market.
Entry into international markets- Celkon has the potential to make its presence felt on global scale eventually as it establishes itself in the domestic market.

* Threats:

Increasing competition from local and international players- With well established players like Samsung, Nokia etc Celkon faces a tough competition from these players.
Replication of business model by competitors- Celkon’s business model has been replicated by many new players which again pose a threat to Celkon.

Objectives

Present objectives: 1) Focus on urban market specially youth 18-25 years
To increase presence in urban market, Celkon is focusing on urban youth of age group 18-25 years.

2) Focus on smart phones
As smart phone is going to be the future of mobile market, Celkon has started focusing on smart phones. It has decided to launch more smart phones in the market.

For 2013-2014: 1. Focus on urban market at large: On capturing major share of urban youth market, for next two years Celkon needs to focus on urban market at large like seiner citizens, physically handicapped etc.

2. Focus on smart phones as well as tablets : Celkon needs to continue focus on smart phones and launch more products and also it needs to focus on tablet market.

For 2015:

1. To increase market share, it is essential to increase production capacity.

2. Focus on international markets : On making strong focus on rural market and urban market in India, Celkon needs to expand to international markets and enter into neighbouring Indian countries, south African countries etc.

Market Segmentation
Identification of the correct market segment is an important step to enter any market.

Target markets

Targeting women

Target Youth

Target Professionals

Marketing Strategy

Marketing strategy is to improve the visibility in the urban markets by improving awareness of customers for our products and also building brand image.

Product Strategy

On the product side, Celkon has a wide range of phones with different features and thus offering variety to the customers. Celkon has a lot of interesting and thoughtful products. Celkon has been able to successfully identify the needs of customers and design products appropriately. Celkon believes that consumers in India have unique preferences with respect to mobile handsets hence, company has invested heavily in the product development as of now to capture market share in urban market it is coming out with new models:

Celkon realized that intense competition between telecom service providers forced customers to maintain two connections, and hence it launched a wide range of dual-SIM phones, which forms almost 85% of its product portfolio as compared to others. Because people are generally used to carrying two mobiles – one for professional work and other for personal use. So dual sim phones can serve the both the purpose in a single phone.

Android based operating system phones are a proving to be a huge success and a craze in youth market and professionals because of its vast applications and new applications which are developed on an everyday basis. And also office documents support, push mail, etc also help in satisfying the needs of professionals in a handy way. So coming out with these phones, we have a huge potential market to work upon.

Introduction of Tablets by 2013-14 will again help in serving the advanced technology needs of professional as it is considered to be almost a substitute of laptop with big screen, advanced features, etc.

Large buttons based easy to use phones which do not have high features but are useful to serve the elder age segment as they want ease of use and are at a very low price.

Pricing Strategy:

It’s at the core of Celkon to serve the customers by proving them with lower cost, value for money products. Thus Celkon will adopt penetration pricing in the urban market because placing our product at a lower cost will serve purpose and make the customer rethink before buying other competitors product such as Samsung, Nokia etc which are at a high price segment. So with a lower price we will be providing with almost same functionality which in turn will help in gaining a better share in the urban market as they also want lower prices phones with higher functionalities which has been proved by our marketing survey.

Promotion Strategy

The motive of our strategy is to increase our visibility in the urban markets. So making people aware about Celkon we will incur high promotional expenses and these will be in terms of:

Hoardings and banners outside colleges, in public places, corporate places and malls with latest products and updates.
Advertising online which include buying up space in highly browsed sites such as rediff, yahoo, etc. Also, It has planned to be more active online on Facebok, Twitter and other social networking sites as it’s a low cost promotion making global presence and tool having international market. It has planned to improve its visibility by blogs sites and also on the sites dedicated to reviews and comments of mobile phones.
It is aiming at bundling with telecom providers like xxxxxxx which will serve as a base in building brand image by associating our names with them.
They have also aimed at higher advertisements through TV, radios, etc which serve large number of customers.
Better after sales service by providing increased warranty on sales of mobile phones from 1 year to 2 years. Currently competitors are proving with only 1 year warranty so this will provide us first mover advantage and also create brand image into the minds of customers.
Sponsoring in the social cause events as customers in urban areas are more aware and inclined towards companies fulfilling social responsibilities and also it will make them aware of us and finally building brand image.

Introducing exchange schemes where a buyer can bring in his old mobile phone and get an additional discount of 5% - 10% on new Celkon mobile phones which would help us in gaining market share of our competitors.

Place Strategy
We can place our products in some popular mobile phone retail stores such as Sangeetha, The Mobile Store, reliance digital, Croma, Big C etc. We will tie up with local distributors for easy availability for those who don’t visit popular retail stores or find it easy to purchase it from nearby stores. We can also sell our phones online by collaborating with Future Bazaar which is an initiative by Big Bazaar, etc.

Distribution strategy
Under it we will have two models:

Firstly, we have business to consumer (B2C) model which follows this hierarchy:

* So under it will Offer higher margins to dealers up to 15 %, which is higher than the industry average of 6-10% at present
• Offering its distributors a higher margin of 5% as compared to 2% of Nokia and others.

Improved incentives to dealers and distributors will help us in penetrating deeper into the urban markets. Thus, making it easily available so as wherever a customer goes to buy mobile phone he will also be introduced and offered Celkon phones or he will have a look of it.

Secondly, we have business to business (B2B) model in which we will have corporate selling through corporate tie ups with major corporate and will be providing them at a less than market price as we will be saving on the commission to dealers and distributors. Thus, helps to reach target market of professional.

Customer Acquisition and Retention

Providing better after sales services through increased warranty of 2 years, thereby making the customer think of reliability of the product.

Exchange offers will also be a major tool for customer retention as the customer will be getting additional discount on the new Celkon phone he buys by exchanging the older one. Thus this will help create a chain of transactions with customers.

Research Methodology