Optical disk drive
LG still sitting pretty
LG, the 2008 Channel Champion in the optical disk drive (ODD) category, ruled the channel mindshare in 2009 too. The vendor continued to do well on channel expectations.
Sony, which was ranked second in 2008, maintained its position. However, the brand had availability issues during Q2 2009, when the company for a brief period stopped DVD R/W supplies because it wanted to push Blu-ray products. However, after finding a lukewarm response to the new ODD standard, Sony had to reintroduce its DVD products in the market.
In the case of Samsung, many of the company’s own authorized sub-distributors rued the lack of focus of the company on ODDs. Similar to 2008, the company witnessed more in-warranty failures (primarily related to the CD tray) than its peers, and also reported more post-sales turnaround issues. As a result, resellers weren’t keen to push the brand in the market—and Samsung had to be content with the number three position behind Sony.
Product availability
LG saw the most consistent availability of products. Sony reported availability issues during Q2 2009, but except for this period, supplies were consistent. However, a few respondents, particularly in the western region, complained that the company frequently changed its sub-distributors, thus creating confusion among resellers about whom to buy its products from. Samsung had no supply issues; however, the channel demand for its products was low.
Price-performance
LG topped this parameter followed by Sony and Samsung. Samsung had relatively high in-warranty failures compared to its two counterparts; Sony too had its share of performance issues. A few respondents said that there were issues regarding the DVD lens in a few Sony drives. On the price front, the average selling price (ASP) of the entry-level 22x drive is Rs 1,200, and there exists hardly any price difference between the three brands.
Partner profitability
For a product category with such a low market operating price (MOP), the margins are hardly Rs 50-75, and all brands offer similar profitability. LG, by the virtue of being the best-selling brand, offered better partner profitability compared to Sony and Samsung.
Marketing and training
Many resellers said that they had to dissuade customers from buying Samsung drives due to warranty issues. According to respondents, the category is so low-value that no vendor does any channel or customer schemes.
Post-sales support
Both LG and Sony introduced over-the-counter (OTC) replacement during the year. Samsung however introduced the OTC feature only from January 2010.
LG polled as the brand with the best warranty support, with the least amount of in-warranty failures, and the quickest service turnaround. While Samsung has a wider service network compared to Sony, it suffered due to in-warranty complaints and a longer repair turnaround time.
Channel policy and management
LG ranked higher on this parameter because respondents said that the company engages more frequently with channels at the local level. Their managers are accessible, and escalated cases are addressed in a channel-friendly manner.
Sony’s channel engagement, including distribution, sales and post-sales warranty, is managed by Rashi Peripherals and overall the distributor is doing a good job.
Samsung needs to improve on its product quality and warranty in case it wants to have a presence in this market. Some Samsung partners said that since the beginning of 2010 the company has made attempts to streamline its warranty support, which is a positive sign.
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