LAL BAHADUR SHASTRI INSTITUTE OF MANAGEMENT

MARKETING MANAGEMENT

PROJECT REPORT
ON
MARKETING STRATEGY OF AIR CONDITIONER

SUBMITTED TO: Prof. S.P. Ketkar

SUBMITTED BY (Group 6):

Dharmesh Goyal- 302/2021
Manasvi Agrawal- 302/2021
Aakriti Gupta- 303/2021
Sudhit Mahajan- 304/2021
Sanjam Kaur- 305/2021
 SECTOR – AIR CONDITIONERS

INTRODUCTION
Air Conditioning Market comprises of Residential and Commercial Sector and is an
extremely important part of the automotive industry.
Air conditioners, which once seemed luxurious, are now becoming a global necessity.
The AC market continues to rise as the automobile industry grows steadily, driven by
population growth and high urbanization rates.
The impact of COVID19 on the growth of the global air-conditioning market: All industries
in the world have suffered the consequences of the COVID19 pandemic and experienced an
unprecedented slowdown.
The Company which we are starting the operations with is named as SUNSHINE.
About SUNSHINE-
Sunshine with its, ‘Make in India’ philosophy, has entered into Air Conditioning market. We
having a long standing commitment to serve our customers, we will make good quality
products with wide range of facilities at a very reasonable price.
Vision-
Driving value through smart engineering.
Mission-
We will offer our customers good quality products so as to build market leadership.

PESTEL ANALYSIS OF AIR CONDITIONING INDUSTRY

Each and every organization works in an ever dynamic environment and is affected by
various external forces around them. In such a scenario preparing PESTEL and monitoring it
becomes crucial in order to plan the future activities and stay ahead from the competitors.
PESTEL stands for Political, Economic, Social, Technological, Environmental and Legal
forces that has major impact on company in some or the other way. Businesses remain
proactive and keep a check on these macro-economic variables and adapt accordingly in
order to build a competitive advantage in the industry by identifying certain opportunities and
threats

Top companies of Air conditioning industry in India

 Voltas Ltd
 Blue Star Ltd
 LG India
 Amber Enterprises India Ltd
 Johnson Controls-Hitachi Air Conditioner India Ltd
 LEEL Electricals Ltd
 Daikin Ltd
 Samsung
 Whirlpool
Political Factors that Impact Air Conditioning Industry

Segregation of Political Responsibilities between Different Government Agencies

-Various government agencies has stopped industries to put pressure on one industry. But, on
comparison with other aspects, both time and costs are increasing and which clearly results in
getting late certifications and clearances.
Judiciary Independence – When comes to handling commercial and taking business
decisions, country’s judiciary is very much independent. Problem arises in business when
differences occur between public interest and proprietary technology.

Democracy & Other Democratic Institutions –There is a need to empower democratic

institutions so that air conditioning industry can strive in open, stable environment. This step
will enhance transparency and clarity and thus, corruption will be reduced.

Transition of Government and Changes in Policy – Policies made by governments are

consistent and in line with each other regarding air-conditioning industry. Other parties
strictly follow all the treaties and rules made by previous governments.

Role Local Governments Play – Local governments are in charge of decision and policy
making strategies of air conditioning industry and these are highly implemented and followed
by local government as enforcement agencies keeps tracks on their activities and directly
reports these in their own states.

Threat of Terrorist Attacks –Air conditioning industry were living under threat because of
violent terrorist attacks. To solve this, prudent policy was there to take insurance in order to
help other air conditioning corporate industries to balance out the losses happening because
of various attacks.

Economic Factors in PESTEL ANALYSIS?

Economic factors control the potential capabilities and attractiveness of potential market.
These factors should consider present market scenario and inflation, GDP growth rate,
disposable income level etc.

Economic Factors that Impact Air Conditioning

Inequality Index– These indexes are considered of varied importance when it comes to
measuring harmony and development of society. Income inequality increases the probability
of conflicts which increases crime in society. That ultimately results in uncertainty and
suppressions creating losses for air-conditioning industry.

GDP Trend & Rate of Economic Growth – Higher GDP directly shows that economy is
flourishing in the country. Air Conditioning industry can directly use current GDP to expand
its product and target potential buyers. Another way is to track the changes in- consumer
purchasing pattern and emerging value proposition.

Employment Rate – Employment rate has to be kept potentially high so to provide

customers with effective Air Conditioning products and secondly Air Conditioning industry
will get to hire talented and skilful set of employees in order to fulfil successful market
demands.

Inflation Rate – Inflation rate can dynamically impact the sale of air conditioning products.
Higher levels of inflation may cause increase in prices of air conditioning goods which could
further lead to low brand loyalty and it would potentially lead to difficulty in handling costs
of products.

Social Factors in PESTEL Analysis

Social factors including demography trends, power structure, women participation in

workforce etc plays a vital role in boosting country’s economy and also workforce talent
availability which helps in successfully meeting increasing levels of consumer demands.

Social Factors that Impact- Air Conditioning Industry

Power Structure in Society – Air Conditioning industry should work on both aspects-power
structure as well as its impact on the economy. For example India has high power structure
towards older generation as that generation has more income compared to millennial of
society.
Gender Composition in Labour Market-Air Conditioning Industry can make use of the
fact of liberal nature of society, women rights and women’s opinions in areas of societal
issues and consumption based decisions. This factor is the best indicator of income of
households and priorities related to domestic households and other daily needs.

Attitude towards Authority – Different cultures have different opinions and reactions
towards authority. Air conditioning Industry should carefully identify all potential measures
before launching a market campaign for its on going business operations related to products
and services.

Attitude towards Savings –Savings culture varies greatly from place to place. This culture
of savings and consumption effects both type and intensity of consumption levels.

Attitude towards Leisure –Air Conditioning industry should have knowledge and conduct
ethnographic survey about both leisure activities preferred by individuals and also on what
basis they opt for them.

Societal Norms and Hierarchy – It majorly emphasizes on the fact that what sort of
hierarchy and norms are suitable for society which also links directly to the consumption
levels of society.

TECHNOLOGICAL FACTORS

Advancement of technology- AC industry should be aware of all the technological

advancements going on and take advantage of the same to provide users with more enhanced
experience.

Due to everchanging technological advancement Smartphones, tablets, apps and 4G

communications have widely impacted various industries including the air conditioner
industry. These developments have helped the appliance think more innovatively. Some of
the examples are -

With advancements in internet facilities the air conditioning industry is also registering a
fast adoption of the same. With internet connectivity, AC’s are now becoming more
integrated in the home to bring efficiency. The user can now control the features such as
temperature, fan speed and mode remotely by installing mobile application for the AC.

Sensor technology - It can help collect data and transfer it securely for further actions/
implementations. Various companies use a combination of sensors and sensor technology for
smart colling nowadays.

The companies are also coming up with technology to detect human presence to cool the
room at optimum level.

The Wi-Fi connected air conditioners- To provide more ease to the consumer the Wi-fi
connected air conditioners help control the room temperature with the help of smartphones
and other electrical gadgets.
As AC produces a lot of harmful gases of the manufactures should constantly look for a way
to manufacture air conditioners that run on renewable energy such as solar energy. They
should take advantage of the new smart and innovative technologies and develop more
energy efficient air conditioners. Like

Digital inverter technology- Several companies such as LG and Hitachi adopted the dual
inverter technology compared to single inverter technology. In the latest new product lines,
many companies are also coming with triple inverter technology which will help increase the
performance of AC as the inverter AC uses around 40% less energy than the normal AC.

Environmental Factors

 Level of Consumer Activism Regarding Environmental Concerns – It is important to

understand the level of consumer activism regarding environmental concerns is. It will help
Conditioning Air in both developing environmentally friendly products and preventing PR
stumble blocks.

Focus & Spending on Renewable Technologies – due to increasing awareness and concern
about environment allocating budget on renewable energy sources and how Conditioning Air
can make this investment as part of its competitive strategy should be thought of.

Regulations and environmental standards both at National & Local Level – Often the
environment policy at national and local level can be different. This can effect air
conditioning companies in numerous decisions such as plant location, product development,
and pricing strategy.

Seasonal factors – Countries like India touch high temperatures in summers thereby
increasing the sales of air conditioners.

LEGAL FACTORS
Legal factors often govern the conditions to enter the market, laws to operate in the market,
and procedure to resolve any dispute with other stakeholders. If the legal system is not taken
care of then Air Conditioning companies can face numerous challenges – from consumer
petitions to shakedowns from authorities. One such factor includes -
The rule of banning import of AC units by the Director General of Foreign Trade (DGFT) is
one such example of legal factors
The government to fulfil the objective of making India self-reliant imposed a ban on import
of air conditioning units that are filled with 'refrigerants'.
While this could have serious impact on small fly by night operators and Chinese firms which
launch their products during peak summer season could disrupt the market, but the local
manufactures can benefit from it.

PORTER’S 5 FORCES MODEL

This model discusses the five forces of the market which shape any industry and determines
the competitive edge and strengths and weaknesses of that industry. This helps in determining
the corporate strategy , to maximize profits in that industry. It is applicable to any segment of
the economy and can be used to understand the level of competition in an industry. This
model was named after the Harvard business school professor Michael E. Porter. This
business model helps define the competitive strategy for a business.
Following is the study of Air Conditioners Industry

Bargaining power of suppliers

Due to the supplier concentration in this industry the bargaining power of supplier is very
low. Which means that since there are too many AC provider options available to the
consumer , the firms cannot bargain on the price much since the consumer might move to
another firm, hence the fear of losing the customer reduces the chances of bargaining.
This industry is also dependent of volume of sales and hence facilitates bulk buying , which
again reduces the bargaining power of suppliers.
Presence of substitute goods like cooler etc also reduces the bargaining power of supplier.

Bargaining Power of Buyers

Due to heavy competition in the market, Performance and Quality of the product are the
major factors that give high bargaining power to the buyers. This lowers down the prices of
Air Conditioners because of which it limits the profit potential of the companies.
Backward integration in Air Conditioner Industry involves high amount of investment. Here
due to less backward integration, the bargaining power will also be less.

Threat of new Entrants (LOW)

Due to the capital requirements in this industry that are needed to set up a plant are very
high , there is very low threat of any new entry. Setting up a plant would need a lot of initial
investment in getting quality components and R&D, to meet the pace of changing
technology.
Also , due to meeting of demand and high fixed costs , manufacturers in HVAC industry need
to build economies of scale , which again reduces this threat.
The level of customization is high in the central and packaged AC system, which is not
possible for a new player to do , but is essential to survive in the market, hence new players
avoid this sector
The distribution channels of existing players are very strong, which is difficult to match for a
new player , hence is a bid barrier o new entrants.

Threat of Substitute Products and services

In the Air Conditioning Industry, if the threat from substitute products is high, then the
companies have to work on the R&D of the product and find a way to sustain its position in
the market or else the market may get disrupted.
Some of the products that pose threat to Air conditioners are: bladeless fans, adiabatic cooler,
traditional fans and coolers, etc.

Rivalry in the Industry

 Air conditioning Market has huge competition from domestic as well as international
firms.
Indian companies include- Voltas, Blue star, Llyod etc..
Foreign companies include- LG, Panasonic, Hitachi etc..
 In the booming real estate face where the demand of houses are more, there will be
huge demand and supply of Air conditioners.
In 2017, the market size of real estate was 134.3 billion dollars. And the expected
market size in 2022 is 197.4 billion dollars. Hence, the rivalry in the industry is likely
to increase.
 Brand value also plays a vital role in Air Conditioner Industry. As once a consumer
gets satisfied from one brand, it is more likely that he/she purchases the product from
the same brand

INDUSTRY ANALYSIS
The Air Conditioning (AC) Market is projected to grow at a significant CAGR from 2019 to
2027 based on MRFR analysis.
Steady rise in global air conditioner market share is likely attributable to active construction
activities around the world to accommodate the growing population, and continuous increase
in people's living standards and widespread urbanization.
The commercial AC market is also on a growth trajectory, with the fundamental
responsibility of global companies to provide clean air.
However, the latest market trends show that the global AC market share will be driven by
future technological developments.
According to a report from the global AC industry, after several decades of rapid growth, the
industry is currently in the maturity stage of the product lifecycle (or PLC) and is expected to
continue that way for a long time.
The cumulative annual growth rate (CAGR) of the global air conditioning market during the
forecast period is expected to be 5.87%.
Major changes in government regulations, such as the ban on the use of R22 refrigerant, have
raised awareness and demand for eco-friendly models to effectively replace traditional air
conditioners in residential, commercial and vehicle market spaces.
Due to the significant growth in the number of commercial institutions such as hotels,
hospitals and individual clinics, the growth rate of the commercial central air conditioning
segment is expected to be slightly higher than that of the entire industry.
AC Market Segmentation
1. Residential, Commercial, Industrial
2. Unitary, Rooftop, PTAC
3. Inverter, Non-Inverter

Marketing Strategy-Product Life Cycle

After conducting successful PESTLE analysis, it is now time for the product Sunshine ACs to
enter into the market. Sunshine ACs needs a perfect marketing strategy to enter the market,
become established and build a strong consumer base as product enter and exit the market
place.

Stages in the Product Life Cycle

The four stages in the product life cycle are:

 1. Introduction Stage

Sunshine ACs has just entered the market. Sales are slow as product is just launched. We
need a perfect marketing strategy to build customer base and do strong promotions and
branding to attract the attention of customers as in introduction phase customers are not
significantly interested in buying the product and hence, profits of company are low.

No amount of profits or benefits can be availed in this time period as production capacity is
not utilized to its maximum extent.

Now, the main aim of Sunshine ACs is to spread widespread product recognition and
encourage market communications to spread product awareness and attract potential buyers.
The principle goals of this phase are to build the demand of the product in the market while
focusing on how the customers are responding to the product. Promotion tactics are applied
to attract innovators and stimulate trials of product by customers. In this phase, cost should be
kept in mind while promoting, as heavy spending also incurs losses as there is no guarantee
that product will cover all losses.

Depending on the market conditions and demands, these 2 techniques can be applied to
cover losses:-

Price skimming: Charging an initially high price and gradually reducing the price as the
market grows.

Price penetration: Establishing a low price to quickly enter the marketplace and capture
market share, before increasing prices relative to market growth.
2. Growth Stage

After successfully introducing the product into the market and meeting the requirements of
customers, product now enters growth stage where product actually grows exponentially and
generates large amount of revenues. Production of Sunshine ACs takes place at much higher
pace as sales are increasing and demand of product in the market is rising. Sunshine ACs are
been accepted in the market and competition between companies become fierce to target the
potential buyers.

Now, since competition is high for the product, Sunshine ACs has to invest heavily in
advertising and promotion tactics to beat the rising competitors and to capture the market
share. Growth of sales of ACs increases the prices of ACs with no improvements done in the
product quality and more distribution channels and layouts are designed to target more sales
volume.

Maturity

At this point, Sunshine ACs have grown to the highest potential and sales of the product
starts declining which means that Sunshine ACs have reached saturation point. Sunshine ACs
has to develop innovation techniques to maintain their position in the market and to balance
out shrinking demand. Pricing of the product are cut down and new promotion strategies are
developed so that weak competitors gets kicked out from marketplace and strong players like
Sunshine ACs continue to dominate the market with altered products.

The biggest challenge for Sunshine ACs is to maintain profitability. To fight this, customer
brand loyalty has to be retained. In addition, to re-innovate itself, Sunshine ACs typically
have to work on strategies such as market development, product development, or marketing
innovation to ensure that the product remains successful and stays in the maturity stage.

Decline

Although after developing significant strategies for product enhancement of Sunshine ACs,
still the sales of product continues to fall and profitability decreases. It happens as other
substitute products have met requirements of customers and competitors have taken over
market share causing sales to deteriorate and losing interest of customers.

These effective strategies can now be employed to save the life of product:-

• Reducing distribution channels gradually and removing the product from underperforming
geographic areas. This method enables the corporation to discontinue the product and replace
it with a new one.

• Selling a specialty operator or subcontractor the product. This allows the business to get rid
of a low-profit item while keeping its loyal clients.
STP-SUNSHINE ACS

Segmentation, targeting, and positioning together comprise a three stage process. Firstly,
SUNSHINE ACs has to determine which kinds of customers exist, and then perform
segmentation by optimizing products for that segment and communicating the optimum
choices to meet the requirements of the potential customers.

Segmentation is used to target each segmented group based on their tastes and
habits, and to alter positioning in branding and marketing tactics to meet
Sunshine ACs needs and expectations.

MARKET SEGMENTATION
Sunshine ACs recognises distinctive and common tendencies in consumer
purchasing patterns, allowing the organisation to create far more engaging
marketing campaigns.

Sunshine air conditioners should aim for more saturated and mature markets
since they offer fresh opportunities and demonstrate distinct benefits to a sector.

1. Geographic segmentation: Sunshine Air Conditioners should track sales by country

and region to attract new customers. This will significantly segment the region,
resulting in revenues and losses.

2. Demographic segmentation: After determining the area, Sunshine ACs should

target potential customers based on the product used by different age groups. For
example, persons between the ages of 25 and 30 will be more interested in purchasing
air conditioners than those who are older.
 3. Behavioural segmentation: Sunshine ACs should assess which of its items are in
higher demand and work on developing and applying innovative strategies to those
products.

.Psychographic segmentation: Sunshine Air Conditioning should target its customers

based on their preferred lifestyle or possible interests.

These are just some of the possibilities for segmenting audience for Sunshine
ACs.

MARKET TARGETING
The next stage is to examine the sectors chosen by Sunshine ACs in order to determine the
finest business opportunities. Sunshine ACs must first establish the size of the market, which
will indicate whether it is worthwhile to pursue. After all, the marketing opportunity must be
significant enough to justify a campaign. The next stage is to see if there are any important
marketers that distinguish the segments; these can serve as the foundation for a STP
marketing effort.

1. Size: Sunshine ACs has to consider how large is the segment and whether it can
grow to its full future potential.
2. Profitability: Sunshine ACs has to consider which of segments are willing to spend
the most money on particular product or service and simultaneously determine the
lifetime value of customers in each segment and do comparisons
3. Reachability: Sunshine ACs has to consider how easy or difficult it will be to reach
each segment with marketing efforts. Higher CAC means lower profitability. 

Sunshine ACs must consider the prospect from a financial standpoint, as the
expected earnings must outweigh the higher marketing budget required to
implement it.

Finally, the targeting stage is all about determining the best ways to use the
customer data and insights gained during the segmentation stage by Sunshine
ACs. The customer journey can then be optimised and more relevant and
engaging marketing campaigns can be created.

MARKET POSITIONING

Finally, Sunshine ACs must evaluate positioning options that will enable them to
respond to a market need or demand that only their product can satisfy.

Sunshine ACs may use tangible data about what segments of the audience want to
position their product and establish a unique selling proposition, presenting the correct
message at the right moment, because they have tangible data about what segments of
the audience wants.

1. Symbolic positioning: Sunshine ACs must enhance the self-image, belongingness,

or even ego of their customers.
2. Functional positioning: Sunshine ACs must solve customer’s problem and provide
them with genuine benefits.
 3. Experiential positioning: Sunshine ACs must focus on the emotional connection
that customers have with their brand.  

A combination of these three factors results in the most successful product

positioning. Making a perceptual map for Sunshine ACs is one approach to
visualise this.

With a segmented and specifically targeted audience, Sunshine ACs product

positioning can have a much stronger impact, helping their message stand out in
a crowded marketplace.

MARKETING TACTICS
The marketing mix/ marketing strategy refers to the set of actions, or tactics, that a company
uses to promote its brand or product in the market. Various components of marketing
strategies are -
PRODUCT - A product refers to any item that intends to satisfy the needs and wants of a
target customer.
PRICE- involves decision regarding How much do you charge and how does that impact
how your customers view your brand?
PLACE – involves decision regarding Where to promote your product or service?
Where to ideal customers go to find information about your industry?

PROMOTION: involves strategies regarding - How do customers find out about you?
What strategies do you use, and how effective they are?

PRODUCT
Key points to be taken care while launching the product are –
 How the new product brand launch will impact the its image in the market .For
example often launching product with no innovative technology may end up
impacting the image of the company as an innovator in the field.
 Will the product be viewed completely different from the existing products of the firm
and how much is the risk of competition for already existing firms.
 Does the product launch satisfy potential customer needs and wants in a way that can
deliver profits to the firm?

The Sunshine AC has been designed to cater to today’s consumer needs. i.e. today’s
consumer seek more comfort by handling various functions through their phone rather than
using the remote control of the ac.
Catering to these needs the Sunshine AC would be developed with high technology providing
the consumer ease to control their Ac from their phones.
Moreover, due to increase global warming the temperature level is quite high in India in
months of May – August so the Sunshine AC would be developed in such way that it
provides faster and more efficient cooling that is it would provide more cooling with less
energy consumption.
Moreover to target customer even in off seasonal periods the Sunshine Ac would launch a
dual cooling system in which it not only would work as air cooler in summer season but also
as a heater in winter season.
PRICING
Various pricing strategy available are –
 Cost base pricing – it is a highly competitive strategy where we first calculate the cost
of producing the good and further decide a markup based on the profit we want to
earn

 Market penetration – it involves launching the product at a low cost to get foot hold in
the market/segment
 Market skimming – it involves charging higher price for certain well-established
product/ high quality products which have developed certain brand value in the minds
of consumer

 Competition based – this involves setting a price relative to the competitors will
simultaneously reducing the cost of production/operation to increase the profit

Since AC is used for industrial as well as in household so it would be best to adopt

differential pricing strategy i.e. cheap affordable prices for household purposes and charging
slightly higher prices for the industrial purposes.
Sunshine also needs to keep in mind the competitors price while setting its own price - such
as Samsung’s Ac cost starts from 25,000 and Daikin Ac starts from 22,000 so Sunshine AC
could priced around 20000- 25000 Rupees
Moreover ,Sunshine being a new brand needs to make space in the industry and compete
with existing brands so it would be best for Sunshine to adopt market penetration strategy in
initial stages to grab the market share by providing best quality products at a affordable price
and further we can adopt market skimming strategy for some well doing products in the
market as consumers do not mind paying slightly higher price for the brand they trust.

PLACE (DISTRIBUTION CHANNELS)

Various modes of distribution that can be used are -
 Direct distribution – where the company sell its product directly to the consumers
through its own store or by just selling the products online
  Indirect distribution – where the products are sold through channel partners like
wholesaler, retailers, and other distribution agents.

 Hybrid – it is a mixture of both direct and indirect distribution channel where the
critical aspect of distribution system are managed by the company itself, and
secondary functions such as warehousing, store management etc. are carried out by
various channel partners.
for Sunshine AC focus is on gaining customer loyalty, it is essential that the reach of
the product is widened to as much as possible.
Sunshine A/C Should choose hybrid distribution channel to reduce the inventory cost and to
grab lager consumer base.
 Main headquarters would be situated at four places Delhi (North), Kolkata (East),
Ahmedabad (West), and Chennai (South).
 Further the product would be available at different stores distributed to retailers via
wholesaler to make them available to consumers at every location.
 The product would also be available at company’s website and other e- commerce
websites

PROMOTION
The focus is on using different resources available to increase the awareness among buyers
regarding the product’s benefits and furthermore to convert the interest of the potential
consumer into desire which will ensure action on the part of the consumer to buy the product.

 The main aim would be to create awareness about the brand being an new entrant, the
focus will be on promotion through communication channels such as advertisement in
television, newspaper advertisement, social media and other platforms which will help
in spreading the aware about Sunshine AC across wider area.

 Using technology that produces less harm to the environment such as minimizing the
wasted to energy consumption creates a positive image in the minds of consumer also
such practices help boosting word of mouth.

Financials
Costing
Particulars Amount (in ₹) Periodicity
 Plant & Machineries 3,50,00,000 One time

Licenses and Certificates 25,00,000 One time

Other office equipment

5,00,000 One time
(Printer, Computer, Telephone etc.)
Other cost
1,75,000 Per month
(Racks and cartons)
Factory 4,30,00,000
One Time
(4000 sq. meter in Bhiwadi industrial area)

Raw materials
1,15,00,000 Per month
(Aluminium Fin Stock Foil, Copper Tube etc.)

Electricity & water bills 15,00,000 Per month

Salary to employees 30,00,000 Per month
Selling & Distribution expenses 7,50,000 Per month
Misc. Expenses 2,75,000 Per month

Forecasting
We have adopted a conservative approach in determining the sales of the company. The
demand for air conditioners is now increasing because of the shift in consumer income.
To arrive at the sales forecast, we took the population of Indian (1400 million) and then we
found out around 0.1% of the people lie in the range earning , this is the population that is
most likely to consume our drink.
So out of this 14 million people (1400*0.1%) we assume that around 80% people are
interested in buying the drink and consume such products. We have a market of 11.2 million
people.
The Global Air Conditioners Market is expected to reach USD 138.03 billion by 2026
growing at an CAGR of 4.42% during the forecast period. With rising GDP per capita
income around the world, the demand for air conditioners is expected to rise during the
forecast period.
According to this research, India Air Conditioner Market revenues are projected to grow at a
CAGR of 12.2% during 2018-2024. India Air Conditioner Market is highly competitive and
fragmented with the presence of domestic, international and unorganized market participants.
1. Production:
Machine capacity 1 Air Conditioner per 12 minute
Operating hours 10 hours per day
Monthly production capacity
1500 Air Conditioners
(24 working days)
Yearly production capacity 18000

2. Sales:
Particulars Year 1 Year 2 Year 3 Year 4
Monthly sales (Air
1500 1650 1900 2250
Conditioners)
Yearly sales (Air
18000 19800 22800 27000
Conditioners)
Average Price per Air
₹ 22000 ₹ 23100 ₹ 24500 ₹ 26000
Conditioner (₹)
Monthly sales (₹) ₹ 3,30,00,000 ₹ 3,81,15,000 ₹ 4,65,50,000 ₹ 5,85,00,000
Yearly sales (₹) ₹ 39,60,00,000 ₹ 45,73,80,000 ₹ 55,86,00,000 ₹ 70,20,00,000

Sales Breakup

Particulars Year 1 Year 2 Year 3 Year 4

Yearly sales
₹ 39,60,00,000 ₹ 45,73,80,000 ₹ 55,86,00,000 ₹ 70,20,00,000
(₹)
Online ₹ 9,60,00,000 ₹ 11,73,80,000 ₹ 15,86,00,000 ₹ 20,20,00,000

Distributor ₹ 30,00,00,000 ₹ 34,00,00,000 ₹ 40,00,00,000 ₹ 50,00,00,000

3. Profits
The approximated monthly cost comes to around ₹ 1,72,00,000. At a price of ₹ 22000 per
bottle, the monthly sales comes to around ₹ 3,30,00,000. The profit in the first month will be
around ₹1,58,00,000.

IMPLEMENTATION AND CONTROL

We discussed 4Ps of marketing , PESTLE analysis and situational analysis along with STP to
come to a concrete marketing plan that has already been discussed previously. Lets talk about
the same in detail.
Sunshine ACs plan to have very differentiated products like heavy technology for big rooms
like halls or conference rooms whereas small window ACs for smaller rooms. Also
sustainable or environment friendly ACs can be manufactured with minimal carbon footprint
since the society is moving towards a green future, so it would be in demand.
For pricing market penetration can be used initially to enter the market and capture the
market share by placing the price in comparison with the competitors to increase the sales.
Later on after we capture the market share, we plan to apply price skimming since the brand
would have gained some traction.
Both direct and indirect distribution channel should be used for distribution of sunshine ACs.
For promotion , we plan to use most sustainable ways which utilize minimum resources and
still bring in results. Like , digital marketing that has maximum reach and , giving ad
commercials and discounts.
The various potential market segments of the market are geographic, demographic,
behavioral, Psychographic that Sunshine AC can gain. The more humid and hot areas should
be targeted. The middle class and upper class are the target customers since they can afford to
pay. Also people high on environmental consciousness and awareness about the AC’s
emissions should be under our radar, as one of our product niche is into sustainable and green
AC. Moreover in each of these target segments we will see how much customer base we have
that can be converted into actual sales by doing survey or looking at the past data and then
forecasting. According to the potential that each segment showcases we can then invest in the
promotion of product. We wish to position our brand as a sustainable green brand , which can
emotionally connect with the consumers mind and create a sense of belongingness among the
consumers.
However if this plan fails to workout , we would try to give discounts on the same products.
Moreover, for the same target markets , we could make creative ad commercial which would
target the sentiments of parent child , brother sister , spouse , grandparents and make this
brand an emotion , not just a product. This would create a loyal customer base in the market
and help in securing us a position while beating the competition. This way by making
emotional advertisements, we will establish a personal connection with the consumers, and
position ourselves to be their preferred brand, thereby increasing our sales.