Slide Share Excercise

1. PEST & Porter’s 5 Force Analysis
New Entrant to Indian Laptop
Market
Ramesh Palanisamy

2. PEST Analysis

3. Political
The Indian laptop industry is rising very rapidly because the consumer work life style is
change day by day, consumer needed are increasing they want those type of product which
is save their time, money and increasing their work efficiency. Some of factor for increasing
laptop sales such as for example where past few decades ago laptop price used to be more
than desktop but today laptop price is equal to the desktop price. Technological world today
and it cannot be ignored Indian laptop industry has going on path of progress step by step
just because due to the expansion of technology in all over the world.
• Slow-down in government decisions due to political instability
• Adverse changes or unpredictability on foreign investment, import, ownership, pricing or
tax issues
• Disruption of normal business due to social and political unrest
• Corruption and bureaucratic inefficiency
• Fluctuation in interest, inflation and currency rates
Increasing focus on the environmental impact of high-tech trash has lead to more stringent
environmental regulations on the electronics industry would require additional testing and
certification involved directly affect the supply chains for laptop and PC manufacturers,
resulting in increased costs

4. The growth in consumer PC market was driven by growing shift in end-user demand towards
portable PCs, which grew at 20.2 per cent in 2012 over 2011, IDC said in a statement.
According to the latest data released by market intelligence and research firm, IDC, Hewlett-
Packard repositioned itself as the number one PC brand in India in October-December period
of CY2012 with a market share 16.5%. Lenovo slipped to number-two position during that
period with a market share of 13.2% followed by Acer at 12.1%.
Tamil Nadu & UP government’s free laptop programme for students, such special projects
could be repeated in few of the larger states with forthcoming elections in 10 states.
Economical

5. Social factors such as education, preferences, income levels, and other cultural factors
influence demand patterns in the different regions and therefore affect how a company
operates in each region.
The education and income level of users affects the brand perception of the computer
manufacturers.
This research analyzes the market for laptops and tablets and the tensions between these
product categories. It presents the latest data on purchase patterns, tests consumer demand
for Ultrabook laptops, and gauges how Ultrabooks will impact the laptop and tablet
markets.
Tablets and laptops are both appealing options for consumers, and some purchase one at
the expense of the other.
Social

6. Emerging technologies such as social media, mobility, analytics and cloud (SMAC) are driving
the growth in this segment and helping it move to the next level.
Technological advances over the past decade, such as increased processing power with
reduced power consumption and reduced cost, or the standardization of Windows and Intel
in laptops, are one of the main reasons for the increase in market share of the laptop
segment compared to the overall PC industry.
Technological

7. Porter’s 5 Forces

8. Competition Rivalry with Industry
As a matured industry, the laptop industry is seeing a price downtrend in the long
term, indicating that aggressive pricing will bring more consolidation in the industry
to reduce development costs.
India's largest computer seller Lenovo said it expects higher competition from rivals
HP and Acer in the coming year, as PC sellers in the country continue to launch
aggressively priced devices in an attempt to attract cost conscious consumers.
Different brands pursue different strategies. Some compromise on profits to win
large deals.
India has traditionally been a price sensitive market for PC's, where no single vendor
enjoys a clear monopoly. Industry watchers say that it is hard to predict how the
Indian market will go forward, given the number of brands and new launches over
the past couple of years.
PC business is a very low margin segment, therefore the game really is to come up
with newer models

9. Due to aggressive pricing and reducing profit margins, there is a high barrier to
entry for new companies. Since large companies are able to invest more in R&D and
more easily hire top management talent, there is greater possibility for more
innovation in the products.
This further increases the barrier to entry for smaller companies.
Sony India has recently announced its plans to market 6.5 lakh laptops of the Vaio
brand in 2012-13. The electronics company from Japan is supposed to put in INR 90
crore and initiate a fresh marketing program for the brand with Kareena Kapoor, its
brand ambassador.
At present brands like Apple, Dell, Sony, HP, and Toshiba are being regarded as the
most preferable options when it comes to laptops. However, other companies like
Samsung are also making their mark. Indian companies such as Wipro & HCL have
some takers as well.
Threat of New Entrant

10. Research and Markets (http://www.researchandmarkets.com/research/q68lhs/ultrabooks) has
announced the addition of the"Ultrabooks, Laptops and Tablets: Complements or Substitutes"
report to their offering.
This research analyzes the market for laptops and tablets and the tensions between these
product categories. It presents the latest data on purchase patterns, tests consumer demand for
Ultrabook laptops, and gauges how Ultrabooks will impact the laptop and tablet markets.
Specific attention is also given to the Microsoft Surface product and how the tablet market will
receive it.
Tablets and laptops are both appealing options for consumers, and some purchase one at the
expense of the other. Ultrabooks will impact this dynamic by making laptops a more appealing
choice in comparison to tablets.
The laptop industry faces a significant threat from new trends such as cloud computing, Which
potentially will reduce the need for high computing power & storage in portable laptops.
Moreover, advances in computing power and as well as communication technologies (3G,4G etc.)
have enabled devices such as smartphones (iPhone, Android Blackberry, etc.) to compete with
laptops by providing similar capabilities. For instance, iPad, Galaxy TB, Funbooks, Kindles reduce
the need for laptops by providing similar functionality or becoming alternate for specific use.
Threat of Substitution

11. Customers have large bargaining power over manufacturers, since a major part of the
total PC sales is made up of large volume buying from businesses. In addition, consumers
also have bargaining power in terms of dictating demand and buying preferences.
Example: bulk order from the Tamil Nadu government to supply free laptops to
schoolchildren.
Consumer preference for mobility and wireless connectivity at low cost resulted in the
growth of the laptop market compared to desktops. In addition, continued demand for
cheaper costs lead to aggressive pricing as well as the creation of new categories such as
netbooks/Touch screen. The power of customers is reflected in the change in buying
behavior
Example: PC sellers in the country continue to launch aggressively priced devices in an
attempt to attract cost conscious consumers.
Buying Pattern of the consumer influences company to change decisions.
Example: customers’ buying behavior in developing markets influenced Dell’s decision to
sell through retail stores as well.
Buyer Power

12. The suppliers for all competitors are quite limited in terms of bargaining power due to
increased commoditization of hardware components. Intel and AMD, the two major
microprocessor suppliers, compete for increased market share. However, their power is
limited due to their need for product promotion among consumers. For hardware such as
hard drives (Samsung, Western Digital, Seagate, etc.) or motherboards (Intel, MSI,
ASUSTek, etc.) there is very limited bargaining power due to their lack of branding on the
finished product. Most manufacturers use different suppliers for the same component, by
sourcing their requirements from whoever is cheaper at that time.
Thus, if the prices are not competitive, the suppliers risk losing out to their rivals. On the
software side,
Microsoft dominates with its Windows line of Operating Systems (OS) and therefore
exerts considerable power over PC manufacturers.
Supplier Power