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CHANNEL STRATEGY
FOR
PACKAGED CENTRAL AIR-CONDITIONING
PRODUCT DIVISION (PCPD)
GUIDED BY
MILIND BEGOOR (Manager Sales)
PRESENTED BY
AJINKYA TIRTHGIRIKAR
COMPANY PROFILE
Bluestar is India’s largest air-conditioning company
• Total Income: 3080 crores
• Net profit: 152 crores
• Listed on Bombay Stock Exchange in 1969
• 32 offices across India
Products segments under PCPD are
Ducted systems (5-22 TR) VRF systems (0.6- 80 TR) Chiller systems (10-4000 TR)
PROJECT TITLE AND OBJECTIVES
Project Title
Channel strategy for PCPD
Project Objectives
• To analyze the channel strategy adopted by competitor’s brands
• To study the existing BSL channel strategy
• To carve out new/improved channel strategy for BSL
METHODOLOGY ADOPTED
• Type of Research: Exploratory research with qualitative
investigation
• Source of data: Internal and External sources
• Sampling
• No sampling for BSL dealers
• Convenient sampling for competitor dealers
• Formalized and unconcealed questionnaire
• In depth interview was conducted
• Data analysis is done in textual and non-statistical way
Conversions
1. Amar builders: Shopping complex at F.C road: 1.5 Cr
2. Aditya builders: Housing society: 60 lakhs
3. Infratech builders: Aambey valley city: 40 lakhs
This was my contribution to Bluestar Ltd in this 2 months which was
done apart from the project given to me.
MARKET SHARE ANALYSIS
Prime competitors for BSL in all 3 segments
• Carrier
• Daikin
SEGMENT WISE REVENUE GENERATION
COMPARISION OF CHANNEL ADOPTED
Channel of competitors Channel of Bluestar
Brand
ICCs Architects Consultants
Exclusive dealers
Multi-brand Dealers
ANALYSIS OF CHANNEL STRATEGY
Channel strategy is analyzed on the basis of following things:
1. Comparison of type of dealers BSL and its competitors posses
2. Stock inventory BSL and its competitors have
3. Period of installations of machines
4. Complaints and their tracking
5. Availability of spare parts
6. Types of difficulties faced while dealing with customers
7. Satisfaction of dealers with dealers policies
8. Area of operation depending on market growth
9. Training of service staff
1. COMPARISION OF TYPE OF DEALERS
Dealers are divided into 3 categories on the basis of their
turnover and product segment they sell
1. Type A: Sells ducted systems only: 1-3 Cr
2. Type B: Sells ducted + VRF systems: 3-8 Cr
3. Type C: Sells ducted + VRF + Chiller systems: 8 + Cr
2. KEEPING STOCK INVENTORY
Reason from BSL dealers
- Keeping stock is a risk and a dead investment for them
3. INSTALLATION TIME TAKEN
Time taken for BSL dealers Time taken for competitors dealers
Installation time for BSL is better in all segment and in VRF its very
similar to competitors
4. TACKLING COMPLAINTS
Time taken by BSL Time taken by Competitors
Time taken for tackling complaints of chillers are very high for BSL where as in case
of ducted systems BSL is good
5. Availability of spare parts
• Availability of spares is directly related to satisfaction of the
customer with the service and brand image of the company
• Satisfaction level is degraded each day by 2%
(Note: This calculation is done with the help of formula generated in excel that was not
reveled by the company)
6. DIFFICULTIES DEALER FACING WHILE
DEALING WITH CUSTOMERS
BSL has the widest range of products where as competitors
are finding it difficult to maintain product differentiation.
7. AREA OF OPERATION
Competitors have analyzed the rising demand and thus increased their
dealers number outside Pune. Where as BSL has 5 dealers since 2010.
Revenue in
2012-13
Revenue in
2013-14
Revenue in
2014-15
12.5Cr 14.6Cr 17.8Cr
8. RATINGS OF DEALERS ON DEALER
POLICIES
BSL dealers are not very satisfied with the dealer policies, this is leading
to channel conflicts between dealers themselves and with company.
9. TRAINING OF SERVICE STAFF
Training of service staff vs. Launching of new product
SWOT ANALYSIS OF BSL CHANNEL
STRENGTH
1. Ducted systems
2. Exclusive dealership
3. Excellent relationship with existing customers
4. India brand
Weakness
1. Number of type C dealers
2. Faliure of previous models of VRF
3.Channel conflicts
4. Mapping new architects builders and Contractors
Opportunities
1. Area of operation
2. Expansion of channel
3. Training of service staff
Threats
1. Daikin coming up with R-32
2. Channel Conflicts
3. Myopic to urban areas
SWOT
KEY LEARNING
1. Studied and understood about channel management techniques
and strategies
2. Learnt about customer relationship management
3. Came to know about how to generate lead for sales
4. Learnt the documentation needed in domestic business
5. Learnt the techniques the manager incurs to eliminate channel
conflicts
6. Came to know about the product specification in central air-
conditioning
7. Importance of after sales service
8. Expansion of channel with different type of dealers
9. How to maintain market leadership
10. What is the effect of failure product on brand image
FINDINGS
1. BSL has experienced dealers in the market (4 dealers having 9+
years experience)
2. BSL entertains exclusive dealership strictly.
3. Daikin has the habit of entering the market with new technology
that surpasses the old ones. (For example- Daikin has invented VRF
technology and is market leader in that segment. Now recently it has
developed inverter type ducted system with R-32 model to capture ducted
system market)
4. BSL has large number of Type A dealers (Type B and Type C dealers
are lacking compare to its competitors)
5. Neglecting the increasing demand outside Pune region
6. BSL dealers are not very satisfied with the dealer policies (Igniting channel conflicts between dealers and with company)
7. Training of service staff is lethargic (Compared to induction of new
products in the market)
IMPROVED CHANNEL RECOMMENDED FOR
PCPD
1. Expansion of channel
1. Induction of new and potential dealers
2. Induction of manpower
(Expansion of channel should be done focusing on Type-B and Type-C dealers
and also BSL should induct those dealers who have the potential to cover tier-2
tier-3 areas where demand is picking up)
1. With induction of more dealers BSL would also need to expand its
work force of sales person so that new dealers are equipped and
managed properly
2. Improvement of VRF & Chiller systems (Many issues with the previous
models of VRF have eroded the band image of BSL. BSL should start building
brand image especially in VRF segment by making customers aware of the new
and improved technology in VRF which is very similar to market leader’s
technology)
Contd.
4. Mapping consultants, architects & builders (BSL has most of its business
through its relationships with architects, builders and contractors. Hence sales staffs
with the dealers are always applicable to map new upcoming architects, builders,
ICCs so as to expand their business)
6. Training of sales/service staff . (Regular training of service/sales staff should
be conducted to make them aware of new technology and advancements in the
products)
7. Improvement in delivery time & installation time by stocking
inventories. (Improvement in delivery time, service time will help create brand
image within the customers and this can be done by stocking inventories with the
dealers and company warehouses.)
8. Make spares available with the dealers and in the warehouses. (Making
spares available in nearby warehouses will always make sure the complaints are
tackled and solved as soon as possible)
IMPROVED CHANNEL RECOMMENDED FOR
PCPD
CONCLUSION
1. Bluestar Ltd is the market leader in ducted systems (Due to its heavy
population of Type A dealers as well as very good service in that segment)
2. Bluestar is suffering brand erosion (Failure of earlier models of VRF
systems)
3. Bluestar has very good customer relationship (With existing
customers, architects, builders and contractors which help them to get repeated
orders and help gain word of mouth)
4. Channel strategy of Bluestar is unique (Entertains exclusive dealership
strictly where as its competitors believe that multi-brand dealers would generate
more business for them)
5. Bluestar also has the largest range of products in Central air-
conditioning (This helps BSL to compete equally in all 3 segments of Central
air-conditioning)
REFERENCE
Books:
1. Research methodology: Concepts and cases- Deepak Chawla & Neena Sondhi
2. Marketing management: A south asian perspective- Philip Kotler
Websites:
https://www.bluestarindia.com/index.asp
http://www.daikinindia.com/
http://www.carrierindia.com/
http://www.vnmpublication.com/IJIRM.htm
Broachers:
https://www.bluestarindia.com/products/central-acs/packaged-ducted-splits-popup.asp
https://www.bluestarindia.com/products/central-acs/vrf-acs-sys-inverter-popup.asp
THANK YOU
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