Odds, but Unfazed
A number of top management exits upset the growth momentum somewhat but the long-term ambitions grew only bigger
For homegrown handsets maker Micromax, which counts itself as the world’s 10th largest handset producer and aspires to break into the ‘Top 5’ league by 2020, the year gone by presented a mixed bag. Bracing up for the global play, it overhauled its corporate, brand and product strategy titled as Micromax 3.0, with a goal that is two-pronged. One, to be first among Indian smart device makers; and two, to find a berth in the Top 5 global handset manufacturers. It has already tested the international waters having ventured into Saarc markets and Russia, where Micromax became the third largest vendor in just two years. It now intends to do an encore in other CIS countries and East European markets.
Exactly how these global ambitions pan out remains to be seen, considering that its performance was impacted during the fiscal, at least in part due to some high-profile exits including its erstwhile Chairman Sanjay Kapoor, CEO Vinay Taneja, and other senior officials. Sales plunged with shipments slowing down to a level lower than industry’s average. Micromax’s earlier stake sale deliberations with China’s Alibaba also went to a cold storage.
Back home, the company retained the No. 2 rank in the mobile phone segment, both in terms of shipment and revenue. In the smartphone segment too, it held on to its position in spite of the intense competition it faced in the Rs 3,500-Rs 7,000 price-band from other local brands. Its Yu brand crossed two million units in 2015.
In anticipation of demand, Micromax will add three more plants—one each in Telangana, Madhya Pradesh and Rajasthan, involving an investment of Rs 300 crore and creation of 10,000 jobs by 2017. It is also ramping up production at its Rudrapur facility to make devices 100 percent in India. Currently, just about 30 percent components are sourced locally.
Going forward, services are expected to have a crucial role involving equitylevel partnerships in services’ start-up ecosystem. The company will infuse capital among promising entrepreneurs to strategically develop its value added services division. By doing so, it wants to build an ecosystem of content, applications, services and software experience.
As it gears up for the global play, Micromax also unveiled a new brand identity and logo, “Nuts: Guts: Glory,” reinforcing its DNA to challenge accepted notions. The consumer electronics maker has roped in celebrities Kapil Sharma and Rana Daggubati to take its market-leading innovations and connect millions of customers. Also, its 360-degree marketing campaign aims at encouraging 70 million new age consumers using feature phones to switch to smartphones. The adoption has been at a slow pace due to three key challenges: high cost of ownership including data packages, hesitation to use touchscreen and English language user interface. To close this gap, the company debuted products with bigger screens, regional language support, and customized data packages.
The company boasts of several firsts. From introducing the 30-day battery backup, to dual SIM-dual standby phones to universal remote control mobiles to first quad-core budget smartphone, its product basket includes over 60 models. With a footprint in 560 plus districts and over 1.2 lakh retail outlets, it is reportedly selling nearly 2.3 million devices every month.
Micromax held on to its No 2 position in the smartphone segment too, in spite of the intense competition it faced in the Rs 3,500-Rs 7,000 price-band from other brands.