With product preferences changing at lightning pace, monitor vendors are churning out newer models and variants at the drop of a hat. This has kept the market in a state of flux. MNCs — with their expansive marketing budgets — are a nightmare for Indian manufacturers, who are constrained by limited funds. And the fight for monitor supremacy continues.
The verdict is out. And the epitaph is being written now. The 14-inch monitor will soon go the dinosaur way. With consumer preferences changing rapidly, products have to evolve to suit their tastes. And vendors are constantly thriving to give their demanding customers the best of both worlds – high-quality products at competitive prices.
The monitor landscape
Like any other product the monitor too has undergone a sea change from the good old monochrome days. Like a silent revolution, the monochrome died a fast death only to be replaced by the 14-inch color monitor. And this model too is suffering the same fate.
The verdict is almost unanimous from consumers and the channel. “15-inch monitors are now considered to be entry-level, as the differential amount of a 14-inch is marginal. Buyers don’t find this as a major hurdle and go for it”, says Chidanand, Manager, SOGO Computers.
Shrinking differentials definitely lead to change in the demand pattern. It is the simple law of elasticity at work. Marketing stories have many precedents of similar nature.
Talking about figures, Rajesh Gupta, CEO, Microtek International says, “About 60 to 70 percent of our sales come from 15-inch.” With the demand for the 15-inch version having stabilized in the market, the next contender is the 17-inch. Though this model has a very rickety hold on the market as of today, it is catching up.
While the 15-inch made inroads quickly on the price difference, the same may not be true for the 17-inch avatar. Though here the difference is not substantial, it is enough to limit the migration. “Customers are hesitant to spend Rs 3000 to 4000 extra for the 17-inch version. And typically it contributes only 10 percent of the total volumes,” says Mukesh Suryan, General Sales Manager, Electro Sales Corporation. Adds Chidanand, “There is only a slight inclination of sales for the 17 inch monitors”.
But monitor vendors are trying hard to usher this migration with a barrage of schemes and promos. An example is the “Move to 17” upgrade program being run by Samsung within the channel.
The higher-end flat monitors too have not really earned market favor because of the exorbitantly high price. “The flat monitors are yet to wake up in the market,” says Chidanand summing up the issue very eloquently.
What is the next step?
What then is the next shift likely to be, is a natural question for companies as most of them are busy trying to spot the emerging patterns that will eventually reshape the industry. And once spotted they want to capitalize on them early, leaving competitors struggling to catch up. Will it be the multimedia monitor?
Market and channel feedback suggests that will be a very unlikely happening. The product has not led to volumes that one would have liked it to do. Sandeep Parasrampuria, Director, The Best, dismisses it by saying, “The product has not moved much”.
Apart from the limited output of sound that the attached speakers produced, the quality also did not seem to attract the customers. “Speakers are bought according to needs and the home buyer typically wants a higher output,” says Mukesh Kumar Gupta, Director, Digitronics Infosys. He further adds, “Customers don’t like their monitors to have ears,” as he infers to the unfriendly looks of the multimedia monitor.
However A V Gopalakrishnan, Director, Visualan Technologies says, “Additional speakers look attractive.”
The MNC versus Indian battle
It is not very often that the channel is unanimous in their preferred choice of vendors. The entire channel fraternity acknowledged that the last two months saw Samsung as the fastest moving color monitors in the market. “One of the key reasons for our success has been our product range. From the entry level to the top of the line – we cover the entire market with over 18 different models,” says Sonal Anand, Country Product Manager (display), Samsung Electronics India Information and Telecom Ltd.
There is no doubt that it is the MNCs that rule the roost in this market. A large part of this success can be attributed to the massive advertising campaign that they undertake. This earns them tremendous mind share. Opines Mukesh Gupta, “The mind share of MNC brands is immense, but this does not mean that Indian brands don’t move or are inferior in quality”.
Microtek is one Indian brand that has gained a foothold in this turbulent marketplace. One reseller words it very aptly, “Microtek is the only Indian brand to put up a brave fight against the MNC onslaught.”
Mukesh Gupta too stands up for Indian brands. He says, “It will be impossible to kill the Indian brands though their market share may slip.” Credit to this conviction goes to the wide distribution network coupled with a support infrastructure that the Indian companies have erected over the years in the country.
Says Sharma of Microtek, “We have ISO 9002 certification for all our servicing activities and centers across India. We have 28 service centers covering the entire country.”
But it cannot be denied that with shrinking margins and limited marketing funds, Indian brands have been mildly aggressive in the channel space as compared to MNCs, who have deep pockets filled with marketing dollars.
With the Indian market space getting hot and margins sinking to abysmally low levels are the Indian manufacturers looking overseas to maintain profitability? “We have been exporting for the past five years,” says Sharma of Microtek. The markets that most Indian companies are today looking at are the SAARC and the European ones.
Though this is not being looked as an alternative to local trading, it is definitely a feasible extension. “Our focus on the domestic market will not be diluted,” says Sharma.
Suffice it to say that the waters are turbulent, with the ferocity of raging storms. But the Indian players are unruffled and willing
to bide their time before they ride the crest of the waves.
Mohit Chhabra in New Delhi with Bobby Anthony in Mumbai and Sunila Paul in Bangalore