“We want our products to be at arm's length to customers”

Now that
you have donned a new hat, how are you going to use your 27 years of
experience to accelerate the growth of MMD in India?

MMD, the
brand license holder for Philips monitors, aims to become one of the
top 5 players in
the monitor's space in India. The company recently kick-started
India market revitalization by launching an extensive range of new
LED and LCD monitors, which is in direct competition with the likes
of LG, Samsung, AOC, and Acer.

There are 2
main sides of our line of business-channels and customers. On the
customer's side, we don't face any issue in terms of brand recall
or recognition in India. We are apparently one of the oldest brands
present in the country. However, looking at the current situation, we
have decided to focus more on the channel's side. Customers are
anyway aware of the Philips brand but just being aware does not
suffice our requirements. They need to know where to find our
products. So, our
strategy is basically 'arm's length marketing' wherein we are
grooming and training the distributors to position our products at
the arm's length of the customers. Once this is done, the chances
of getting picked up are high. It is all about the reach of the
products. What we have realized is, we don't have to dwell too much
on the customer end but need to activate our channel partners.

Since you
will be spearheading MMD's business in India, what will be your
approach in providing strategic business direction for the Philips
brand?

We are
looking at positioning ourselves as one of the top 5 brands in the
Indian market by the end of 2011. As far as the company's direction
is concerned, we are directed to see ourselves in the league of top 5
brands in terms of numbers, penetration, and value.

And in order
to achieve this position, we want to build a strong channel ecosystem
and at the same time, address the customers' need as well. Any
advertisement in a consumer magazine would reinforce the brand but
won't create a new customer for us. We will focus more on the
channel's side and take help from channel publications to ensure
that channel is continuously fed with information about Philips, our
future plans, strategies, etc.

What was
the intention behind going in for a regional distribution model?

In order to
gain the leadership position in the Indian market, starting 2011, href="http://www.dqweek.com/MMD-India-rejigs-its-channel-ecosystem">MMD
India has adopted a tier-2 distribution model, wherein it has
started
working with regional distributors, who in turn, will directly sell
to the retailers. The 4 RDs that the company has engaged to take its
products to the Indian market are: Global Infonet (North), Nook Micro
Distribution, a subsidiary of Redington (South), Roop Technologies
(West), and Technocrat(East).

I have
realized from my experience that India may be one country but
actually things are little
different. Each state is different and it is very difficult for us to
go to the state level in terms of distribution. And since every
region has a peculiar buying behavior, we decided to go to the
regional level. To initiate the channel, we thought it is important
to have a regional distribution system so that we can do our
marketing focused on regional requirements and address the buying
behavior of the region. Earlier, everything was done through national
distribution system. Seeing this scenario, it definitely makes sense
to go for regional distribution model, so that we can focus on
regional buying behavior. This is probably where my experience came
in handy.

But do
you
think it is a viable option to do away with NDs as well as
sub-distis?

Earlier, the
company used to work with NDs like Redington, ACS and prior to these
two, Compuage and Priya Distributor were other two distributors as
well. But soon, after I joined MMD India, I realized that these big
players are not equally strong in the different regions. If a
distributor is based out of South India, the majority of its
marketshare will be coming from that particular region only. They are
not strong in other regions. At the end of the day, their
effectiveness is more in their own region. So, de-facto, going with
the RDs makes a lot of sense.

The reason
for eliminating sub-distis is that probably we wanted to have first
hand experience of the retail behavior of customers when they walk-in
any showroom, ie, the last point of sales. Besides, we need to know
the retailers first hand. With the involvement of sub-distis, it is
difficult to track retailers. Having said that, we are not taking any
kind of unconventional approach towards the market. The partners with
whom we are working are tried and tested. All our RDs have been in IT
distribution for a fairly long time now.

What are
the factors that drive your product innovation?

Though our
products are not very unique, what drives innovation is to stand-out
from the crowd and
address the need of the hour. Besides, we insist on bringing values
to our products so that while we are serving the purpose of giving
visual output through our monitors, we are also giving our customers
value additions like ultra-thin monitors and other innovative
features. Moreover, we
have a very strong R&D and not to forget, our competitors also
make monitors, but MMD only makes monitors. Like them, we are not
into consumer appliances space. Our entire focus is on monitors.

Will
there
be more focus on B and C-class cities concerning your products? Also,
how are your products being priced, looking at India being a price
sensitive market?

India lives
in these class cities only. Another reason for adopting regional
distribution system is to
cater to the demands of these cities. The NDs get their business from
big metros and
urban cities. Their focus is not on the small towns. But, RDs like
Technocrat would go to these small cities because the company gets
its business from these B and C-class cities.

Our products
are competitively priced and we wish to be among the top 3 players in
terms of pricing. Very soon, we are going to put a calculator on our
website which will guide our customers that even if they pay some
extra amount to buy a value-added product, how soon they can recover
their money. We probably have the largest variety of products but at
the same time, we are not going to focus on the bottom of the pyramid
pricing. Our products won't be the cheapest and will not be
available at the price of a local brand. It would come amongst the
branded products pricing.