MOBONIK CASE

Submitted by: Kanupriya Gathoria Roll No.: PGP10023

CASE FACTS
 2 new launches
o Mobi K5: premium category, launched 1st May
o Mobi L2: mass category; launched 31st May
 Mobonik performance: market leader in mobile category; invests 10% in research and development
o Distribution Strategy: sales potential and performance based; exclusive and multi-brand stores
o Display Strategy: eye level is buying level; products placed at start of aisle do not sell well
o Product performance: K5 and L2 are inputs to future business strategy of entire company

CHANGES FOR NEW MODELS

 Launched K5 and L2 as upgrades for K4 and L1

 Changed the visual displays in exclusive outlets to maintain their market leadership
 Changed planograms for May-June period
 THREATS:
o Cannibalisation of K4 and L1
o 85% of sales were through 1-star category outlets which became a concern for the company

RECOMMENDATIONS

● After the launch of L2 with growing sales, sales of L1 fell by 82.14% in June from 1372 to 245 units
which depicted cannibalization of L1. Thus, L2 proved to be a successful product launch.
● But in case of K5, there was an increase in sales for the month of June probably because of Planogram,
but in subsequent months, sales reduced to 301 units. However, Sales of K4 reduced just by 12% in
June and later grew by >60%. Though the sales reduced even later but not drastically. Hence, we can
say that K5 might not be that successful launch.
● Clearly from table 1 we can categorize exclusive, 4 & 5-star outlets into value outlet and 1,2 & 3-star
outlets into volume outlets
o Premium category phones in the value outlets can add an exclusive attribute
o While mass category phones in the volume outlets can stress on price points and features
available
● Since Chinese companies will have the upper hand in 1-star club due to price factor. And, Revenue
generated by 5,4-star clubs remains less affected, but for 3-star clubs it goes down by 24%. Mobonik
could tie up with more dealers to improve this downfall as 85% of its mobiles are sold through 1-star
category outlets.