Onida and Videocon, the two groups fighting for the number two position in India's colour TV market, have totally different strategies, and entirely different thinking behind the moves in the marketplace. While the Videocon group uses a multi-pronged, multi-brand strategy, Onida has harnessed a single brand with sub-brands to do all its work, all riding on what the group says is superior technology.
Onida rides on a premium, high-tech plank, and has managed to start climbing up the CTV market ladder successfully again. "What has helped in our revival is several new models (the launches have started speeding up since April 1999) and a revamped advertising strategy which has helped bring about total freshness to our brand," says G.L. (Gulu) Mirchandani, chairman & managing director of Mirc Electronics.
The advertising revamp has been accompanied by an amalgamation of marketing responsibilities. All-India marketing for the group has been brought under one roof, under Mirc. Earlier, while marketing for the western and southern regions were Mirc's responsibility, the north and east were looked after by Monica Electronics, based in Delhi.
Mr Mirchandani is banking on quality technology and superior aesthetics to take Onida ahead in the future. "We have very strong R&D of our own," he says. "We're constantly increasing investment here. We started out with five R&D people. We have 75 today."
He believes that slashing prices is not the best way to reach the top. "We've always sold at a premium, but we're offering TVs that are good looking, of stable quality and have a very low failure rate."
Incidentally, the Onida group is content with its technical tie-up with the Japan Victor Company, better known as JVC, which has lasted over the turbulent 1990s while other companies switched and changed partners. Mirc does not believe that multiple tie-ups on technology or brands is a better route to success.
Mr Mirchandani feels that Onida's decision to offer technically superior products will take it places. And so the pride in developing core competence in sound, through its KY technology, which has just been re-launched as KY Rock -- "It's a benchmark in 21-inch sound technology," he boasts.
And is he proud of the launch of the Onida Wallscape, a flat-screen TV that is only 15 cm thick; Onida Pure Flat, with a 100 per cent flat screen; Onida Twister, with a motorised swivel base that helps rotate the screen to suit the angle of vision. And the Web Cruiser with an Internet facility with a built-in modem, a virtual keyboard and a wireless keyboard. And the Candy range of 14-inch sets "or all young-at-heart. It's a fashion statement" in a range of bright colours that you would normally find on candies of the edible kind.
At Rs 9,990, the company believes it has got its Candy pricing just right."We were the first to launch a pure flat TV in India in April," says G. Sundar, Mirc's chief executive officer. "Our spate of new launches is intended to get Onida perceived as a premium, high-tech brand."
Not that Onida has any intentions of ignoring the mid-to-low-end, despite its claim that most of its sales come from higher-end models. As the market at the lower end began expanding exponentially around two years ago, Onida launch its Igo budgetline series at far more competitive prices.
In the next two years, the brand will see a full range of pure flat products in 21-inch CTVs. On the anvil is also a PIP (picture-in-picture) 25-inch model, where two channels can be run simultaneously and also heard, one through headphones, the other through normal speakers. The model will have a double tuner.
So focused is Onida on positioning itself on the premium, high-tech plank that it is even planning to push its own envelope on obsoloscence, much like Intel has been doing in its own industry. "This business has to be conducted much like the fashion business," Mr Mirchandani explains. "Start a product at, say, Rs 11,000, bring it down to Rs 10,000 and then discontinue it. Start another product at say Rs 11,500, bring the price down and then discontinue it. And so on. You have to make your own model redundant almost every year."
Mr Sundar confirms this direction, saying, "Our whole game plan has been drawn up accordingly. Candy's span will be six months. In 18 months, all our new launches will be discontinued, and will be replaced by new versions." Of course, Mirc says it carries model parts for seven to eight years, so customers not looking for such small cycles will not be left in the lurch on model repairs and servicing.
So the brand that finally buried its devil (the mascot that was the envy of rival manufacturers for years) in January this year is not missing the horned and tailed figure at all. Its new advertising direction -- tongue-in-cheek humour in conveying the brand/product message (remember the aeroplane commercial and the more recent Sachin Tendulkar voice ad?) -- is appropriate, feels the company. As for the line that went with the devil -- "Neighbours' envy, owner's pride" -- well, it doesn't come up in the ads any more, but it's surely there in Onida's endeavour to be perceived as a premium, high-tech brand.
Onida's steadiness in the marketplace is something Mr Mirchandani believes is a good base to build on. "In terms of investor value, we have been steady, maintaining a 60 per cent dividend over the past three years. This year, we gave a 65 per cent dividend. Our equity is Rs 7 crore and our reserves Rs 150 crore."