Lg Rural Marketing

LG India advent To Rural Markets Summary From the few years, consumer electronic manufactures have started focusing on the untaught markets for their evolution and expansion. The major reasons include saturation of urban growth rate and ontogenesisd contribution and higher growth rate in markets. Increase in disposable incomes due to good agricultural output, increase in easy financial options by banks and financial institutions, increased media keenness and electrification of inelegant areas are influencing the growth of merchandise in rural areas.In this electric discharge situation, Indias learning consumer electronics manufacturer LG Electronics India Pvt. Ltd. (LGEIL) began concentrating on rural market. To mark its front and to increase sales, LGEIL intentional a different market outline for rural areas. It made changes in its point of intersections to suit needs of rural customers. For example, LG removed flourishing eye technology in models sold in rural market. retentiveness in mind about the rural customers, LG carried out campaigns in various regional channels like Lashkara, Alpha Punjabi, and Gujarati.LGEIL adopted a unique(p) scattering strategy for rural markets to increase its presence and sale of its early(a) products. The follow designed a pyramidal sales structure by decentralizing its distributing network. The company fragmented the distribution network with branch offices run from big cities and legion(predicate) Remote Area Officers (RAOs) working at a lower place for apiece one branch office. These RAOs were provided fragmented with Regional Sales Officers (RSOs) working under the supervision of each RAO. By 2005, company had 51 branch offices and 78 RAOs.Each RAO was given charge of the territory with an independent accounts, sales, servicing and marketing team. To incite RAOs in there endeavour the offices were computerised and connected with branches officers and the corporate offices ERP system through Very Small Aperture Terminal (V-SAT) and an Intranet network. This enabled the RAOs to have with-it data on important aspects such as inventory, payment spot of the dealers, etc. The RAOs overseeing the territories were given independent decision-making powers to the extent of developing their own marketing and promotional strategies in their territories.This setup helped the company in not meet improving sales but also in penetration mystifying into the market. The distribution setup also enables the company to establish relationship grain the sub-dealers who are not been contacted by the company representatives. Better servicing of the sub-dealers helped in increasing their sales. But analysts pointed out that such a distribution strategy was not unique and had been many of its competitors. For example Samsung and Electrolux Kelvinator followed the same strategies. Questions for disputeion 1.A company needs to be careful in its approach while victorious decisions regarding terri tory management. Discuss the territory management followed by LGEIL for its rural markets. dissolve Territory management develops and implements a strategy for directing selling activities toward customers in a sales territory aimed at maintaining the lines of communications, improving sales coverage, and minimizing osteal time. It includes the allocation of sales calls to customers and the planning, routing, and scheduling of the calls. LGEIL designed a different marketing strategy for rural areas.It made changes in its products to suit needs of rural customers. Keeping in mind about the rural customers, LG carried out campaigns in various regional channels like Lashkara, Alpha Punjabi, and Gujarati. The company designed a pyramidal sales structure by decentralizing its distributing network. The company fragmented the distribution network with branch offices operating from big cities and many Remote Area Officers (RAOs) working under each branch office. These RAOs were further fr agmented with Regional Sales Officers (RSOs) working under the supervision of each RAO.Each RAO was given charge of the territory with an independent accounts, sales, servicing and marketing team. To suffice RAOs in there endeavour the offices were computerised and connected with branches officers and the corporate offices ERP system through Very Small Aperture Terminal (V-SAT) and an Intranet network. This enabled the RAOs to have up-to-date data on important aspects such as inventory, payment berth of the dealers, etc. The RAOs overseeing the territories were given independent decision-making powers to the extent of developing their own marketing and promotional strategies in their territories.This setup helped the company in not scantily improving sales but also in penetration doubtful into the market. The distribution setup also enables the company to establish relationship rag the sub-dealers who are not been contacted by the company representatives. Better servicing of th e sub-dealers helped in increasing their sales. 2. LGEIL followed a new sales structured to market its products in the rural markets, different from the one used in urban market. Discuss the advantages and disadvantages of LGEILs rural sales structureAnswer Advantages * Better market coverage. * Effective distribution of work load. * Evaluate sales people. * Control on direct and validatory costs. * Optimum utilization of sales time. * Helps manager better control and admonisher sales and evaluate programms. Disadvantages * Sales achieved through personal relationships * Sale of technological and sophisticated products. * Customers spread over vast geographic area. * Service expectations and product deliveries is at multiple places so geographic division will not help.