Philips eyes 10% of RI electronics market<\/p>\n
Johannes Simbolon
\nThe Jakarta Post
\nBangkok<\/p>\n
The Dutch technology giant Philips is targeting to increase
\nits market share in Indonesia's electronics market to 10 percent
\nthis year, believing that affluent Indonesians will pay greater
\nattention to its products.<\/p>\n
The company has almost tripled its market share in the
\nIndonesian market over the past three years, up from 2.5 percent
\nin 1999 to 6.5 percent last year.<\/p>\n
\"Three years ago, our market share in Indonesia was very
\nsmall. Since then, our market share has been going up very
\nfast ... We are now targeting 10 percent of the market,\" Frans
\nvan Houten, executive vice president of Philips Consumer
\nElectronics for Asia Pacific, Middle East and Africa said last
\nWednesday in Bangkok during the company's annual meeting with the
\nregional press.<\/p>\n
Van Houten said Philips was also targeting a 10 percent market
\nshare in other Asia Pacific countries.<\/p>\n
According to company data, Philips' electronics market share
\nis still less than 10 percent in all the Asia Pacific countries,
\nexcept for three, New Zealand, Singapore and Pakistan, where it
\nhas a 24.3 percent, 14.8 percent and 21.3 percent market share
\nrespectively last year.<\/p>\n
In Indonesia, Philips' electronics products have been
\navailable for many years but the company has thus far failed to
\ncompete with Japanese brands for various reasons, including a
\nweak marketing strategy. Until 1999, it distributed its products
\nthrough a joint venture operation with a local firm.<\/p>\n
The economic crisis sparked by the sharp depreciation of the
\nrupiah against the U.S. dollar in 1997 and 1998 dealt a further
\nblow to the company, pushing up the prices of its products, which
\nare all imported. At that time, Philips' spare parts became
\ndifficult to find in Indonesia.<\/p>\n
The company then reviewed its marketing strategy. It acquired
\nits local partner's share in the joint venture operation in late
\n1998 so that it could wholly run the franchise, which is now
\ncalled PT Philips Electronics Indonesia.<\/p>\n
Since then, despite the lingering economic crisis, Philips has
\nbeen involved in an aggressive campaign to promote its products.<\/p>\n
\"Three years ago when I came to this region, one of the first
\ndecisions that I took was that Indonesia would be a priority
\ndespite the economic crisis.<\/p>\n
\"One of the first acts that we did was to establish a new
\ncompany, Philips Electronic Indonesia, as a vehicle to reenter
\nthe market,\" van Houten explained.<\/p>\n
He said Philips would focus on consumers in Jakarta and other
\nbig cities before moving into the rural areas.<\/p>\n
He ruled out the possibility of producing products for the
\nlower end of the market, saying Philips would maintain its image
\nas a producer of quality products for middle and high income
\nbuyers.<\/p>\n
He dismissed consumer worries about its after-sales service,
\nsaying that Philips' spare parts were plentiful on the local
\nmarket, and that there were numerous service centers in big towns
\nauthorized by the company to repair any broken equipment.<\/p>\n
The company imports all its products, and van Houten ruled out
\nthe possibility of setting up a manufacturing plant in Indonesia
\nfor the moment, citing Indonesia's currency fluctuations, social
\nand political instability, and the lack of skilled workers in the
\ncountry.<\/p>\n
During the two-day press event, Philips also announced some of
\nits latest products that would soon hit the electronics stands in
\nthe Asian market, including Indonesia.<\/p>\n
One of the new products is the Matchline TV series using Pixel
\nPlus technology. This technology doubles the horizontal
\nresolution of standard TVs and increases vertical resolution,
\nthus bringing sharpness, detail and depth to pictures on screen.<\/p>\n
Another product is the Streamium MC-1 2000, an audio product
\nthat enables consumers to choose music stations available on the
\ninternet through broadband access.<\/p>\n
Thus far, Philips has inked agreements with seven top online
\nmusic providers to make their services available on the new
\nPhilips audio product. The music providers are AOL Music, Launch,
\nAndante, MP3.com, MUSICMATCH, Radio Free Virgin and iM Networks.<\/p>\n
Philips also launched its new digital video disc (DVD)
\nproduct, called the DVDR890 recorder. This is equipped with a
\nnumber of facilities that makes it easy to use, and produces
\nexcellent pictures.<\/p>\n
The company also announced during the press event its
\ncollaboration with sport footwear, apparel and equipment maker
\nNike to produce and market \"smart\" products that combine audio
\ntechnology with sport footwear, apparel and equipment. Athletes
\nwearing Nike products can now comfortably use Philips's audio
\nplayers during sporting and fitness activities.<\/p>",
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