Retail Strategy of Handset Makers

BenQ
This Taiwan based handset maker supplies its products to its national distributor, Salora International, who in turn caters to its 4,000 retailers out of whom 3,500 are loyal retailers who place orders every month. On a national level, the handset maker has a tie-up with Aircel where the service provider could woo a customer with a BenQ handset along with its own service. At the state and regional level, the company also has made some tie-ups with other service providers, like BSNL in Rajasthan and Airtel in the eastern part of the country. The company is also foraying into organized retail market. Though it is yet to get a national level presence through these chains of stores, it has a presence in south India through Universal, a retail chain of stores in the southern part of the country.

To provide post-sales service to customers, BenQ has a partnership with Onida. Adonis, the service arm of Onida, which takes care of the service and repair part of BenQ phones. They have more than 210 such centers in 170 cities across India.

LG
The unique strategy of LG is that it does not have a national distributor. LG GSMs sell directly through dealers, as they believe in maintaining a direct relationship with channel partners. Presently, they have 18,000 dealers in 550 cities and plan to expand it to 25,000 by the end of 2007. To maximize sales volume, LG has initiated setting up of experiential stores called 'Fone&Fun' in the metros. LG has branch offices in larger cities, central area offices in smaller towns. These branches in turn reach out to even smaller towns and villages through remote area offices. LG already has got a stronghold in these circles, which has further got strengthened by its association with Airtel.

In providing post-sales service, LG has introduced a unique initiative called "One–Hour Service" ie handsets are serviced in one hour and if can't be fixed in an hour the company provides a temporary replacement till the original is repaired. They have 650 company owned service centers.

Motorola
Motorola has two national distributors-Bharti Teletech for GSM handsets and Brightpoint for the CDMA model. With these two national distributors, Motorola handsets are available in 32,000 retail outlets covering 200 towns across the country. The company also has tie-ups with all major service providers like Airtel, BSNL, Hutch, Tata Teleservices and Idea cellular. The company has three exclusive showrooms called Motostore where the company's handsets and accessories are available. Currently, these stores are in Mumbai, Bangalore and Chandigarh. Also, the company sells its products through a number of retail chains like Mobilenxt, Mobile Magic, Mobile Store and HotSpot.

On post-sales service and repair front, the company has service centers in all the major cities. They have Motorola owned service centers as well as Motorola authorized service centers across the nation. Also the company has 300 collection centers in small cities where faulty handsets are being collected and sent to authorized service centers for repair purposes. For high-end phones, the company appoints Motoassists, who, upon getting a call from the customer, would go to his doorstep, and collect and send the handset to a service center. Once the handset is repaired, they get back to the customer with the repaired handset at his doorsteps.

Nokia
The brand Nokia is used by 800 mn customers globally and India contributes around 9%, which means around 75 mn phones have been sold in India. For handsets, Nokia is opting for a TIER strategy and it focuses on four key things-telecom, Internet, entertainment and retail.

Till date, the company has done extremely well and according to VOICE&DATA, it has a combined market share of 55.4%, whereas globally it is at around 36%. On the accessories part, it is still a small business and is not picking up due to high duties. In terms of distribution, the focus is on increasing reach by developing strong distribution points and developing branded retail through Nokia Priority Dealer (NPD) and Nokia Concept Store (NCS).

The mobile leader has a three-tier distribution model. It starts with HCL and Bright Point as national distributors followed by redistributor stockists and, finally, retail outlets. The company has a wide reach in terms of retail distribution as it is available in 90,000 retail outlets across India and is catered by around 800 distribution points. In terms of coverage it is present in around 5,000 plus towns. The company is also planning for a massive expansion in towns and villages and is at par with the massive expansion plans of service providers. On the post-sales service front, Nokia claims that around 95% of their complaints are resolved within 24 hours.

Samsung
Samsung, as part of its global strategy does not cater to the cheap, low end Indian market. It has two national distributors, Telemart and United Telelinks which in turn cater to 10,000 retail outlets covering 2,000 towns. Also, this handset manufacturing giant has partnership with service providers to expand its business of CDMA phones, where the customers get a handset when they go for any of these service providers. As Samsung targets the urban youth, its brand promotion strategy is youth oriented. Their branding strategy includes coming up with new, feature rich and slim phones, which are glamorous and handy.

All types of post-sales service are provided at Samsung service centers. Depending upon the service requirement, which can be as simple as the demonstration of phone usage to PCB related problems, the company categorizes the services under various levels (between Level 1-Level 4). In case of extreme cases, the company also undertake full replacements of the handset. Currently, Samsung has 20-customer service plaza, which are company operated service centers, and 250 authorized service centers across160 cities.

Sony Ericsson
Sony Ericsson's distribution system starts with its national distributors, Salora International, Sony India and Ingram Micro. And these national distributors supply Sony Ericsson's products to 25,000 retail outlets covering 784 cities spanning the whole nation. The company's retail presence is also noticeable through 375 shop-in-shops, which have dedicated corners for Sony Ericsson's products. The company also has nine Advantage Stores-the Sony Ericsson exclusive stores-in all the metros to give consumers a complete feel of the Sony Ericsson products. The mobile handset maker has also gone one step ahead in making the customers know what they are buying and what the handset features mean to them by taking the customers to their Experience Stores. There are currently 15 such stores in metros and some 'A' category cities, and the company plans to expand the number to 100 by the end of this year.

The company's after sales service network is spanning over 270 service centers in 166 cities. Also the company has a dedicated customer help line. Some of the issues that are related to handset uses can be sorted out over phone, and if the issues are related to handset malfunctioning, then the customers are asked to drop their handsets at the nearby service centers; alternatively, an executive can come to the customers place and pick the faulty handset, get it repaired and deliver.

Spice
Spice Mobile has a reverse distribution system. Unlike others, Spice's distribution starts with retailers and on the way reaches micro distributors at the district level and at the end reaches regional distributor, which could be at the state level or national level. Currently Spice has 36 regional distributors and 375 micro distributors catering to 20,000 retail outlets across India. Spice handsets are also available in Hotspot, the retail arm of the Spice group. Currently Hotspot has 50 stores in Delhi and their plan is to reach 1,500 outlets in 200 cities over the next two years.

Spice has nearly 100 after sales service centers across India. These centers are actually the franchisee of Spice, as Spice has no authorized or company operated service centers of its own. They have four levels of post sales service centers, from L1 to L4. L3 service centers are the ones where the main activity takes place, where issues related to hardware and software malfunctions can be fixed. L4 is the highest level of service options that is available to customers where issues related to component changes can be done. Presently Spice has only one L4 service center in New Delhi and they are planning to open three more L4 centers. On the expansion note, Spice is planning to add another 50 numbers of L3 centers and 10 company owned service centers by 2007 end.