The Hindu Business Line : BPL on the comeback trail

Keiji Oshima, President and COO, Sanyo BPL, and Ajit G. Nambiar, Chairman and CEO, Sanyo BPL at the launch of Sanyo Next Generation 21" Super slim TV in Bangalore.

SOON after the launch of the joint venture between Sanyo and BPL, the honchos of the two companies flew to Kolkata for the reopening of the BPL Gallery. There, they were introduced to a couple who told them that they had waited for nearly two years for the showroom to be reopened to replace their television set with that of BPL, says V.G. Rajagopalan, marketing head of Sanyo-BPL.

"The loyalty to our brand has not withered even though we weren't in the market for over two years," says Rajagopalan, his face lighting up with pride. But BPL will need much more than a couple of loyal customers to battle it out in a market that is being increasingly dominated by Korean brands. And in a market place where brands burn out fast, it won't be too long before one knows the fate of BPL.

Ajit Nambiar, Chairman and CEO of Sanyo-BPL, the man whose every move will be watched and debated, however, expects his brand to become a market leader in five years. "We have been out of the market for over two years now. We are confident we will regain our market share," says Nambiar. He expects Sanyo-BPL to post over Rs 2,000-crore turnover in three years and lead the market in consumer durables as well as white goods in five years.

According to Rajagopalan, for the last two years, his team has been working hard, crunching numbers, sharpening its marketing skills and perhaps waiting endlessly for the joint venture to be launched. "Probably for want of having nothing else to do, we have been sharpening our skills, planning our moves and studying the changing market scenario for quite some time," says Rajagopalan.

Consumer research during that time threw up some interesting facts. While BPL was seen as trustworthy, it was also seen as a brand that lost out because it lagged behind in technology. "We were not seen as a technology leader," Rajagopalan. It was ironic _ BPL was once seen as an innovator; it was perhaps the first to launch the flat TVs, a hot favourite today.

A recap of the ORG figures shows that while BPL was the leader in the CTV market in April 2002 with a share of 17.2 per cent, it had slipped to the fourth position by December with a share of 9.8 per cent. LG Electronics and Samsung had overtaken it to occupy the top two positions in the pecking order with shares of 15.3 per cent and 13.5 per cent, respectively. Since then, it has been a free fall for the BPL brands.

The research sample consisted of some 1,200 people and 12 focus groups. The positive factor was that BPL was still seen as a trusted band with a very good service back-up. "Fortunately for us, we don't have to build the brand," says Rajiv Rastogi, Sanyo-BPL's head of brand management. Hence, most of the advertising and marketing will revolve around emphasising the technology edge the brand has acquired and the trustworthiness it already has. In a few weeks, the company will also decide on its brand ambassador. It has shortlisted a few celebrities to promote the brand. "We are looking for a brand ambassador who comes across as a person you can trust. Someone who has been in his field for quite some time and has established his credibility," says Rajagopalan. "There aren't that many to choose from to fit such a profile."

Another big issue was whether the products should have the names of both the partners or whether they should go it alone. After a lot of research and market surveys, it was decided that BPL will be positioned as a mass market player with some aggressive pricing to back it up, while Sanyo will be positioned as a niche player to address the high end. The logic behind the decision was that BPL had always been seen as a volume player, while Sanyo, with its Japanese pedigree, could compete with Sony on an equal footing. The strategy was simple: each brand will build on its strengths rather than try and create new space. Also, the retail market would have access to the entire basket of products as well as pricing - something the dealer would be only too willing to promote.

However, in the case of white goods, Sanyo will have its own range of unique products such as the jumbo-sized 332-litre frost-free refrigerators and the frontloading tilted tub washing machines.

But industry watchers say the company will face challenges on every front. Says D.K. Sabharwal, a management consultant with Abacus, which works with companies such as Pepsico and Whirlpool: "Once you vacate the space, it is extremely difficult for the player to return to the same place in one of the fastest growing markets in the world."

Sabharwal says the only way a company can make a comeback is with innovative products like the Swift car that is redefining the auto industry, or superior technology. "Do they have it in them to come up with such products?" asks Sabharwal.

LG Electronics' Vice-President for marketing, Girish Bapat, says the only differentiator in the marketplace is how innovative the product is. "Technology and innovation are playing a critical role as never before," says Bapat.

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