UNIVERSITY OF MUMBAI

Market Strategy of Micromax

A project submitted on behalf of M.Com Courses

Submitted by: Roll No.153 Abhishek Amarnath Tripathi

Under the guidance of: Prof.Dr T.B.Gadhave 2013-14

DECLARATION

I hereby declare that the project work entitled Market Strategy of Micromax submitted to the SYDENHAM COLLEGE OF COMMERCE AND ECONOMICS, is a record of original work done by me under the guidance of Prof.Dr T.B.Gadhave my professor and this project work is submitted in the partial fulfilment of the requirements for the award of the degree of master of commerce. I assert that the statement made and conclusion drawn are an outcome of the project work. I further declare that to the best of my knowledge and belief that the project report does not contain any part of any work which has been submitted for the award of any other degree/diploma/certificate in this University or any other University

_____________________________________ ( Abhishek Amarnath Tripathi, Roll No.153 )

CERTIFICATE
This is to certify that MR.ABHISHEK AMARNATH TRIPATHI of M.COM PART-I (Accountancy) has successfully completed the project on MARKET STRATEGY OF MICROMAX under the guidance of PROF.DR T.B.GADHAVE

INTERNAL GUIDE

EXTERNAL GUIDE

PRINCIPAL

Certified that the candidate was examined by us in the project work and viva examination held on ________________________ at SYDENHAM COLLEGE , CHURCHGATE, MUMBAI-20

ACKNOWLEDGEMENT

I would like to thank in my own humble way my supervisor for his guidance and supervision, which has played a vital role in the completion of this Project. I would be failing in my duty if I do not thank to the students, teachers and people who cooperated in the the data collection. In addition i am thankful to my family who has been supportive of my work. I am extremely grateful to my parents who always wanted the best for me and encouraged me to persevere

INDEX / CONTENTS

Sr. No. 1 2 3 4 5 6

Particulars Overview of Micromax India Situation Analysis & Market Oppurtunities and Issue Strategic Management Research Methodology Conclusion and Observation Bibliography /References

Page no. 6 9 17 21 27 31

CHAPTER 1: OVERVIEW OF MICROMAX INDIA

1.1 Introduction
The mobile phone market in India is worth 130 million handsets annually. While the big boys like Nokia, Samsung, LG, Motorola and Sony Ericsson make up for 70% share, the market has of late seen a slew of domestic firms such as Micromax, Karbonn and Intex making large inroads and new established brands like Videocon and Onida entering the field. Among the domestic firms, one of the most promising brand is Micromax. Few years ago, when Vikas Jains firm was delivering computer printers and monitors across India, he saw first-hand how pervasive Nokia had become. Just as in Europe, where most peoples first mobile phone was made by the Finnish giant, it had repeated the trick of getting in first and carpeting the subcontinent with its no-frills handsets. Despite Nokias dominance, the Indian mobile-phone market was far from being saturated. Jain saw his chance. From a standing start two years ago, his company, Micromax, is now churning out 1 million phones a month. He believes that next month it could overtake Samsung, with 11% of the market, and seize second place in India. When Nokia or Samsung roll out a new model they do so from its global portfolio rather than launching something specifically for India, said Jain, who set up the company in 1990s along with three friends from engineering college--Rahul Sharma, Rajesh Agarwal and Sumeet Kumar, all of whom are in their mid-30s to early 40s. Micromax, started operations in 1991 as an embedded software design firm, but was incorporated as a company in 1998, when it branched out as a distributor of computer peripherals such as printers, monitors, scanners from manufacturers such as LG, Sony Inc., Dell Corp. Today, Micromax is one of the leading Indian Telecom Companies with 23 domestic offices across the country and international offices in Hong Kong, USA, Dubai and now in Nepal. With a futuristic vision and an exhaustive R&D at its helm, Micromax has successfully generated innovative technologies that have revolutionised the telecom consumer space. Micromax, as they claim on the companys website, is on a mission to successfully overcome the technological barriers and constantly engender life enhancing solutions. Micromaxs first innovation was a handset with 30 days of standby battery life crucial in a country like India where power failures are common. Next there was a dual memory card phone, priced at 26, for callers who like to juggle the cheapest tariffs. The companys vision is to develop path-breaking technologies and efficient processes that incubate newer markets, enliven customer aspirations and to make Micromax a trusted market leader amongst people. Micromax has a lot of interesting and thoughtful products to its credit on their versatile product portfolio. It was the first to introduce: 1. Handsets with 30 days battery backup 2. Handsets with Dual SIM / Dual Standby 3. Handsets Switching Networks (GSM - CDMA) using gravity sensors
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4. Aspirational Qwerty Keypad Handsets 5. Operator Branded 3G Handsets 6. OMH CDMA Handsets, etc. With a 360 degree advertising and marketing strategy sketched out, the company has an optimistic outlook for the telecom consumer space. Currently present in more than 40,000 stores across the country, the company plans to have an aggressive market incursion to reach out to its customers through 70,000 operational stores in the coming year. One of the major aspects that contribute towards the substantial monthly growth of Micromax is its 80% sales in the rural areas. After building a strong presence in the rural market, where the prominence of both subscribers and operators is rapidly increasing, Micromax is now progressively moving towards establishing its foothold in the competitive urban towns as well. Micromax recently ventured into the telecommunication industry with an end-to-end solution of Fixed Wireless Devices and Wireless Data Cards. In the year 2008, after delivering upon the technology of fixed wireless-powering desired products, the company forayed into one of the most predominant genres of telecommunication Mobile handsets. Since then Micromax has received commendable response for its unique and interesting handsets.Innovation, Cost-Effective, Credible and an Insightful R&D are given high emphasis at Micromax in the telecom vertical.

1.2 History
Micromax started their mobile phone manufacturing operations in 2008 when multinationals ruled the telecom industry. With an understanding of the rapidly changing consumer preferences coupled with the use of the latest technologies; Micromax differentiated itself from the other players with its pricing. Everything started with a truck battery in the year 2007. In the powerless village of Berhampur in West Bengal, Mr. Rahul Sharma saw an AirtelPay Phone being powered by a truck battery. Every night, the PCO owner would lug the battery 12 km to an adjoining village on his cycle, charge it there overnight, and lug it back to Berhampur in the morning. Rahul was fascinated by the nature of innovative adaptation to suit the difficult conditions which the payphone operator had employed and his interest only grew when he found out that to everyones surprise, the operator was also able to earn a tidy sum of money. Based on this experience of innovation arising from constraint, Micromax soon launched its first phone which had a battery back-up of one whole month known as X1i. In 2011, Micromax entered the phablet market with the Canvas series.

1.3 Product Innovation

Micromax product portfolio embraces more than 60 models today, ranging from feature rich, dual-SIM phones to QWERTY, touch-enabled smart-feature phones and 3G Android smartphones designed for younger consumers in suburban and urban markets. Some of the industry firsts devices launched by Micromax since inception are: First Long Battery Life Phone with 30 days battery back up o X1i Marathon Battery phone with 30 days standby time & 17 days Talk time
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 First Dual SIM Dual mode active Phone (GSM+CDMA) o Micromax GC700 is the first GSM + CDMA Mobile phone First Gaming Device o G4 Gamolution phone with motion sensor gaming like Wi-fi First Womens Line of Devices o Q55 Bling phone- First womens phone with a swivel form and Swarovski navigation keys First Universal Remote Control Phone o X235 With Universal Remote Control for TV, DVD, AC in your phone First phone with built-in blue tooth o Micromax X450 Van Gogh A stylish phone that integrates a detachable Bluetooth headset in its sleek design First Superfone with Gesture Control o Created a new category called Superfone with Gesture Control, powered with 1GHz dual core NVIDIA Tegra 2 Processor

CHAPTER 2: SITUATION ANALYSIS & MARKET OPPURTUNITIES AND ISSUES

Situation Analysis
Analyzing current situation through 4C framework:

Customers
Currently Micromax is dominating the rural market. Initially the marketing strategy of Micromax was to target rural market. They are basically catering to the need of the customers of the rural area. For example the first mobile Micromax introduced in rural area was having the battery backup of 30 days which was catering to the need of the rural market of inconsistent power availability.

Competitors
Micromax knows that there are many established brands in Mobile Phones industry like Nokia, Samsung, LG and several other local as well as Chinese manufacturers . Some major competitors and their strategy and strengths are identified as below: 1. NOKIA Nokia is the leader in the mobile phone industry in India (38% market share). 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 going to use operating system of software biggie Microsoft. So it is expected that Nokia will try to regain its lost market share. 2. 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. 3. 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. 4. Other domestic players Other players like Karbon, Spice, Lava etc have more or less the same market strategy. 5. 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 Samsungs growth, market also witnessed the growth
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of the local manufacturers (36% of the market share). The most prominent local manufacturer with a market share of 7% is Micromax.

Courtesy: IDC report on growth of mobile sales in India, 2011 { Market share of various handset manufacturers in India in 2011.So in this emerging and demanding market, still Micromax has a lot to achieve to be a leader in mobile phones industry. }

Company
It was in 2008 that four friends, Rajesh Agarwal, Sumeet Arora, Rahul Sharma and Vikas Jain, came together and decided to diversify their IT hardware distribution business and start making mobile phones. The move towards selling handsets was a natural progression. With a Cost Leadership Business strategy Micromax entered into Indian rural market. And within 3 years of operation they have become the 3rd largest selling company in India. Micromax is planning to launch an IPO of 2.15 crore shares to raise around Rs 2260 million. The major part of the money raised will be used in setting a new manufacturing plant in Tamil Nadu and the rest in acquiring additional market share.

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 250 million handsets are sold annually. By 2014, it is expected to grow to around 400 million handsets.

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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 240 million handsets in 2014 (Source: Analysys Mason)

Market opportunities and issues

The Indian mobile handset market is expected to grow from a total of 151 million handsets for the twelve month period ended December 31, 2009 to 402 million handsets for the twelve month period ended December 31, 2014. 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 device market is likely to grow the fastest. (Source: Analysys Mason)

Replacement cycle:
The growth in the Indian mobile handset market is likely to be driven by the replacement handset market rather than new user additions. The replacement market is expected to grow from 118 million handsets for the twelve month period ended December 31, 2010, constituting 62.77% of overall Indian mobile handset market, to 359 million handsets for the twelve month period ended December 31, 2014, constituting 89.30% of overall Indian mobile handset market.
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3G business:
3G service is an emerging technology in India. 3G technology provides growth opportunities through multiple avenues including up gradation to 3G 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 3G will also add impetus to the growth of the VAS market due to 3G's faster network capabilities.

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SWOT Analysis Strengths:

Innovative products and featuresMarathon battery mobile phones with a 30-day battery life, phone which is programmable as a universal remote control, gravity phones are some of the features which have increased the popularity of the product.

Low cost of production

With its plants located in China, Micromax bears a low cost in production due to availability of labour at cheaper rates.

Effective promotion campaignsMicromax has been promoting its products through famous celebrities and has also had tie ups with MTV.

Weaknesses:
Weak brand image in urban areasMicromax 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 brandMicromax has a manufacturing unit set up in china which has strengthened this perception among people.

Opportunities:
Increase penetration in urban marketSince Micromax has not yet entered this market; it has a very huge opportunity to establish itself in this market.

Entry into international marketsMicromax has the potential to make its presence felt on global scale eventually as it establishes itself in the domestic market.

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Threats:
Increasing competition from local and international playersWith well established players like Nokia, Samsung, etc Micromax faces a tough competition from these players.

Replication of business model by competitorsMicromaxs business model has been replicated by many new players which again pose a threat to MICROMAX

Objectives
Present objectives: 1. Focus on urban market specially youth 18-25 years To increase presence in urban market, Micromax is focusing on urban youth of age group 1825 years. 2. Focus on smart phones As smart phone is going to be the future of mobile market, Micromax has started focusing on smart phones. It has decided to launch more smart phones in the market.

For 2012-2013:
1. Focus on urban market at large : On capturing major share of urban youth market, for next two years Micromax needs to focus on urban market at large like seiner citizens, physically handicapped etc. 2. Focus on smart phones as well as tablets : Micromax needs to continue focus on smart phones and launch more products and also it needs to focus on tablet market.

For 2014:
1. To start new plant and reach market share of 20% :

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To increase market share, it is essential to increase production capacity. Micromax has plans to start a new plant in Tamil Nadu. With the help of this new plant, it will be able to reach a market share of 20%.

2. Focus on international markets : On making strong focus on rural market and urban market in India, Micromax 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

Micromax X1i Market Segment : Rural Market Customer Need: Commendable battery back-up and low price. Corresponding Features : 30 days battery backup and priced at Rs. 2,150 Micromax GC360 Market Segment : Working Executives/ Professionals Customer Need: A single phone with Business and Private use with sepearate numbers and bills. Major Corresponding Feature : GSM + CDMA Micromax ezpad Market Segment : Texting and Chatting Freak youth Customer Need : Faster messaging Major Corresponding Feature : QWERTY keypad Micromax X111 Market Segment : Multimedia Users Customer Need: Phones with all multimedia features to enjoy music, capturing moments as photos and videos. Major Corresponding Feature : Various music format support(mp3, wav etc.), Camera with video recording support Micromax Bling 2 Market Segment : Urban Women
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 Customer Need: Stylish, slick and sensual mobile phones. Major Corresponding Feature : Sensues design to attract women (Diamond) Micromax A70 Market Segment : Youth Customer Need: Compact phones with all latest features. Major Corresponding Feature : Touch Screen, High resolution Camera, Large data storage capacity, Powered by 3G.

Target markets
1. Targeting women
On the occasion of Mother's Day, Micromax announced the launch of its latest Android phone targeted at women. Micromax has started pre-booking of Bling2, which is 3G and GPS enabled, has features like Swarovski keys, 3 megapixel camera, and 32GB external memory. Bling 2 features Android 2.2, 2.8 inch display, 3MP camera, 32GB microSD card support and WiFi along with the usual GPS, Bluetooth and 3.5 mm headset jack

2. Target Youth
As smart phones are future of telecommunication industry, Micromax has started focusing on it strongly. After the launch of first Android Phone before 3 months ago, Micromax is ready to launch another Android Phone Micromax A70 in India. New Smartphone will run on Android 2.2 Froyo. As the speculation is that Micromax A70 will come at affordable price and with 3G as well. Micromax A70 will come in the market and it will be in the competition with Google Nexus and HTC Desire smart phones. Micromax Android Mobile Micromax A70 will come with the advanced features like 3.2-inch HVGA capacitive touch screen display, 5 megapixel autofocus camera & front is a VGA camera for video call, Wi-Fi.

3. Target Professionals
Professionals keep two phones in todays life: One for Professional use One for Personal use Micromax will come up with Dual SIM mobile phones. Micromax has to focus on this target to cater need A single phone with Business and Private use with separate numbers and bills.
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 Besides this, Micromax has to get into the Tablet Market to increase the mark et share.

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CHAPTER 3: STRATEGIC MANAGEMENT

Marketing Strategy
Marketing strategy adopted was framed in such a way so as 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, Micromax has a wide range of phones with different features and thus offering variety to the customers. Micromax has a lot of interesting and thoughtful products. Micromax has been able to successfully identify the needs of customers and design products appropriately. Micromax believes that consumers in India have unique preferences with respect to mobile handsets such as long battery life, dual GSM capability, low-cost QWERTY phones, universal remote control and gaming phones. Also, the 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: Micromax 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 market leader Nokia which introduced one only recently. 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 2012-13 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

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Pricing Strategy:
Its at the core of Micromax to serve the customers by proving them with lower cost, value for money products. Thus Micromax will adopt penetration pricing in the urban market because placing our product at a lower cost will serve our purpose and make the customer rethink before buying other competitors product such as Nokia, Samsung, 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 us 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 Micromax 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 its 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 Vodafone and Airtel 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 Micromax mobile phones which would help us in gaining market share of our competitors.

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Place Strategy
We can place our products in some popular mobile phone retail stores such as Sangeetha, The Mobile Store, reliance digital, Croma, etc. We will tie up with local distributors for easy availability for those who dont 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 Micromax Offer higher margins to dealers upto 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.

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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 Micromax phones or he will have a look of it. Secondly, MICROMAX 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, helping it 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 our product.
Exchange offers will also be a major tool for customer retention as the customer will be getting additional discount on the new Micromax phone he buys by exchanging the older one. Thus this will help create a chain of transactions with customers.

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CHAPTER 4: RESEARCH METHODOLOGY

Research Methodology
The data was collected through both the primary as well as secondary sources. The primary source of the data is the users of various mobile handset users. The sources of secondary data are the websites and company catalogues.

Method of Data Collection

Sources of Data: a) Primary Data: Primary data was collected through direct communication with the respondents. The survey was performed through a structured questionnaire. We approached local people of BSR Mantralya, HSR Layout and Koramalngla. b) Secondary Data: The sources of secondary data were the websites of various mobile providers, catalogues of various mobiles, newspapers, magazines etc. Findings and Analysis

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Performance Dashboard: Market Share:

From 2009 to 2011

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Market leader Nokias share has come down to 39%, Samsung and Micromax shares have increased. From 2011 to 2012-13 For next two years, due to Nokias brand building exercise its market share will not fall as it fell between 2009-11. Samsung will continue to grow to 25%. Therefore, Micromaxs growth will be largely by taking the share of other domestic players in the market.

Production capacity: Micromaxs new plant in Tamil Nadu will be functional from the end of year 2012. The amount will be raised through an IPO. With this, the production capacity will increase exponentially after 2012. Its estimated to reach 75 million by 2015.

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Profits:

With increasing production and sales, the profits are expected to grow upto Rs. 1875 million by 2014.

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Contingency plan
Micromaxs main focus is to provide customers lower price phones with high features but if there is a change in Indian customers preference from high functionalities to design then Micromax needs to take into consideration the new trends in demand and launch handsets with good design.

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CHAPTER 5: CONCLUSION AND OBSERVATIONS

Factors Contributing to the success of MICROMAX

Asset light business model: While Micromax focuses on the core competencies of product development, design, marketing and branding by having in-house teams, most of the rest, including manufacturing and distribution, is outsourced. This has helped the company scale up fast. Low working capital: By asking distributors to pay cash upfront before delivery, in return for larger discount margins compared to peers, and leveraging lucrative credit periods from OEM partners, the company is able to operate with minimum working capital, as a result boosting return on capital employed. Agility and rapid execution: Time to market new products from concept to launch is about three months for Micromax compared to around 18 months for larger competitors Branding and marketing: Whats the point in having a great product at an attractive price point if people do not know about it thats the logic behind the massive marketing budget in excess of Rs 100 core. By betting heavily on cricket and the youth segment, Micromax enjoys a superior marketing return on investment. Optimum balance of durability, features and price: With product lifecycle of gadgets and especially mobiles shrinking to less than two years, most customers are not interested in paying for a mobile thatll last forever what they want is the latest design and attractive features at affordable price point. But a latest cookie cutter international product with a whole array of standard features may be too pricey and not necessarily relevant to the local customer. What Micromax has managed to do is offer the optimum balance of durability, features and price by keeping their eyes and ears close to the local customer pulse. Extensive nationwide distribution network and after-sales support: Micromax has a three-tier distribution network in India, consisting of state-level distributors (60+) , local distributors (800+) and retail outlets (50,000+) covering almost all the States in the country, including Tier-2 and Tier-3 towns. In addition, they have set up a large (400+) network of third-party-owned after-sales service centres that offer quick turnaround customer service as a key differentiator. Despite the vast difference in scale, could Micromax become the Samsung of tomorrow in the electronics space? Only time will tell. The bad news for investors is that Micromax is not yet listed and its attempt to go public in 2011 had to be aborted due to poor stock market conditions. But now that the financial markets seem to have turned a corner, who knows, the company could possibly hit the IPO market again Better late than never.
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Micromax as a Brand in the Media ( Posted: Monday, February 8, 2010. 10:45 PM IST on livemint.com (website of the famous Bnewspaper): Micromax challenges Samsung, LG in mobile phone stakes.)
The news further elaborates that Citigroup Global Markets Inc. has confirmed Jains assertion in a 3 February report, which said Micromax had a 10% market share, putting it at No. 3 behind Nokia and Samsung, which had 12-13%. The success of Micromax prompted US private equity group TA Associates to buy less than 20% of the firm for around $45 million (Rs210 crore today) in December, valuing it above $225 million and indicating confidence in its growth potential. Jain estimated that the firm will close the fiscal with sales at around Rs1,500 crore.The Brand Micromax has now started gaining acceptability not only with the consumers but also with the images, which now has started portraying it with a positive image. Whereas increased consumer sales support the acceptance among the consumes, following quoted are some extracts from the news reports that show that media is also looking up to this brand. Micromax seems to have taken a breath of fresh air and totally remade their presence. From their previously drab website, theyve moved into a much more vibrant state and theres clearly a significant difference in their mobiles as well, at least cosmetically, (quotes www.tech2.in in a review for its newly launched model X360.) Micromax has also tied up some pretty big brands like Yamaha for enhancing their audio experiences and the X360 comes with an MTV branding andexclusive content. Apart from the mobile handset market, Micromax was recently in the news for its alliance with BSNL. State-owned Bharat Sanchar Nigam Ltd. entered into an agreement with Micromax for sale and distribution of 3G data card to its subscribers. As per the agreement, Micromax would sell and distribute 3G data cards in the form of USB to the BSNL subscriber in various cities. In another venture, Micromax launched the Indias first operator branded 3G mobile phone H360, in association with MTNL. The H360, pre-loaded with applications to enable video calls, mobile TV,social networking, wireless business solutions through web browsing and other Internet-based services

Product Differentiation
So, as listed Micromax has been quite effective in the marking a difference with almost every product that it launched. The range that they have covered varies quite a large variety. Right
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from the handsets with 30 days battery backup, dual SIM, handsets switching networks (GSM -CDMA) using gravity sensors,aspirational QWERTY keypad handsets to operator branded 3G handsets to the most exciting OMH CDMA Handsets, etc. Every product of Micromax had the potential to grab the attention of media as well as the consumers in a market which is already flooded with mobile phone handsets and a launch is there in every day or two. (Micromax spent heavily on branding during the recent India v SA; Jaypee Infratech Cup) A recent Economic Times report

Image Differentiation : From Rural to the Urban grounds

Micromax specialized in entry-level and mid-segment handsets priced between Rs1,800 and Rs2,400 when it started selling the devices in 2008, confining itself to small towns and rural areas in the first 12-18 months. Encouraged by its success, the firm expanded to larger cities and now has a distribution network of 55,000 retailers, which it plans to scale up to 70,000 by the end of March as part of its strategy to raise sales to 1.5 million handsets a month. The journey is also now spans through the wide range that Micromax plans to offer to its consumers in the coming period. Micromax is planning to expand its range in keeping with new market demands. It is readying several high-end handsets, including phones that will run on Googles Android and Microsofts Windows Mobile operating systems. The handsets are expected to be available in April or May, Jain said. Micromax has also tied up with a Bollywood celebrity who will be announced shortly as brand ambassador, Jain said.

Channel Differentiation
Micromax has invested Rs100 crore to set up a plant in Baddi in Himachal Pradesh as it feels outsourcing manufacturing completely leaves the door open for supply-side uncertainties. Production will be scaled up from an initial 50,000 per month. If everything goes right, by the third phase in March 2011, the Baddi plant will be making about 500,000 handsets, Jain said. If the plant isnt able to cope with the numbers, the fallback plan is to acquire a facility in South Korea, Taiwan or China, he added. Nokia has a plant in Chennai, established in 2006 at a cost of around $150 million, from where it also exports

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Summary
Till very recently, Micromax was seen as a second grade brand with hardly any brand value. But with the recent reports listing the figures in the companys favour as well as the huge branding done by the company itself along with the interesting product portfolio has taken the brand to a respect position. And the position is still is very promising for the future. For a company which still has not been listed on any exchange, a turnover of about 1500 Cr. can be termed as huge. Certainly the company has the potential to be a threat to the foreign giant as it has been successful in studying the Indian mindset better.

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Bibliography /References

http://www.thehindubusinessline.com/features/investment-world/macroview/strategy-behind-the-screen/article4203766.ece http://www.thehindubusinessline.com/industry-and-economy/info-tech/micromaxoutsells-samsung-apple-tablets/article3978515.ece?ref=relatedNews http://www.micromaxinfo.com/resourceContent/Micromax-Mobiles-companyprofile-final.pdf http://www.rediff.com/money/slide-show/slide-show-1-tech-how-micromax-usedchina-to-build-its-business/20130204.htm#1 http://www.business-standard.com/article/management/how-micromax-cracked-thecode-112101002004_1.html http://marketingpractice.blogspot.in/2010/03/micromax-nothing-likeanything_16.html http://pitchonnet.com/blog/2013/09/23/case-study-micromax/

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