Micromax Wakes Up, Finally!

Being an established brand with an entire line of product portfolio of consumer devices, Micromax has many advantages over its competitors,including the Chinese brands, and the company can hold on to its glory provided it goes nuts about innovations and shows guts in executing all that it had charted out in its vision 3.0.

micromax_logo_3.0

It was classic exemplification of ‘better late than never’ by Micromax last week when the company, it appeared, rose from its slumber all of a sudden and tried to portray itself as a ‘revamped’ Indian brand. Just not that, the company also promised itself to fire all cylinders to become the country’s top services company in next five years. In a glittery event held in one of country’s glamourous event hosting venues, the ‘Kingdom of dreams’, Micromax wove some dreams for its customers, for the industry, and of course, for itself.

During the event, Micromax, in a valiant display of its re-gathered confidence, put before the audience its wish list for the next five years. It wants to be known as the country’s top services company, mind it, not just a smartphone company, in next five years; to be among world’s top 5 smartphone brands and to have all of its products manufactured locally in next two years. At present, 60% products of Micromax are locally manufactured, the company claims.

It was good to see the company making tall claims clubbed with confidence and that too at a time, when, for various reasons, the company is struggling to stand tall among its fiercest competitors in a very competitive Indian smartphone market.

But, Why Now?

The re-branding exercise, in fact, was an answer to the numerous wake up calls the company received in the last year or two. Micromax, who has been the number two smartphone company in the country and way ahead of its local competitors like Karbonn and Intex in various parameters, however, was slowly, losing its grip off the Indian handset market. On a quarterly performance basis, according to multiple research agencies, the gap between number one and number two smartphone brands was widening and that of number three was shrinking. Micromax, some claimed, was losing the number two spot. CMR claimed, in Q1 2016, Intex surpassed Micromax, though the research agency also said the Gurgaon headquartered firm will surely make it up in the very next quarter.

Again, it was not about just one wake up call. There were many. You can’t sleep on a ‘bed of complacency’ for long. Micromax had great products – feature phones, smartphones and, yes, tablets. In the introductory years, Indian consumers bought more Micromax Canvas tablets than that of Samsung and Apple put together. But the company could not hold on to that for long because of multiple factors including the most pressing one – global market for tablets was degrowing.

Third wake-up call was when some senior executives quit the company in a very short period of time. People come and go, that’s a global phenomenon with corporates, but when some decorated senior employees leave within months of induction, eyebrows raised.

The next wake-up call sounded when Micromax cofounder Rahul Sharma formed another company out of Micromax – YU Televentures and created a new smartphone brand – YU. That confused the industry. ‘Who is looking after Micromax now’ was the unasked question. For obvious reasons Rahul’s entire focus was on YU, and none of the other three co-founders were visible during Micromax events or were appeared to looking after business affairs of the company. Rajesh Agarwal was out of the smartphone business for quite some time, Vikas Jain was focusing on some other products like laptops and TVs, and the fourth one- Sumeet Arora has always been a backstage expert.

Now, take a jump to a step below the corporate hierarchy.

One of the company’s most decorated catch, Sanjay Kapoor, ex-CEO of Bharti Airtel, had quit the company within months; and Vineet Taneja, again another telecom veteran having exposure to services as well as devices business, had also put in his papers. Simply put, Micromax appeared to be head-less, though there were quite handful of industry veterans with immense potential to take the company out of the rough waters. But they were under-utilised.

With all these pressing issues plaguing the company, it was difficult for Micromax, or for that any company at this situation, to remain focused and retain its glorious past at the same time grow at a required pace.

Fortunately, the company, though late, seems to have realized the issues, and the re-branding exercise was a step toward putting the things in place once again.

Micromax: What Is New Now?

For me, there were lots of ‘new’ with this revamping of the company. The company tweaked its corporate logo a bit with a new tagline. This time, the new tagline – Nuts : Guts : Glory- complements the logo – the ‘Fist’, more than the earlier one – Nothing Like Anything.  The earlier tagline sounded very product centric, the new one identifies with the company, the brand., offering a holistic view. A ‘Fist’ with slogan like ‘Nuts and Guts’ could mean the company may leave no stone unturned and do ‘whatever it takes’ to reach ‘there’.

The second ‘new’ factor was the showcasing the next line of leadership. The event witnessed a rare development, where the four co-founders of the company, after many years, shared the stage, though for a brief period. But they spoke nothing.  It appeared the baton was handed over to someone else. The grand event which the company calls as ‘Micromax 3.0’ saw two second line of senior executives – CMO Shubhajit Sen and Business head Ajay Sharma, take the center stage and chart out the company’s future goals.

Company insiders say it was Sen, who took the challenge head-on and initiated steps in planning the future goals of the company. The insiders also say that Sen held numerous close door meetings with industry experts to understand the issues with the company and find out remedial measures.

Third but one of the boldest statements was to aim to be among world’s top 5 smartphone brands by 2020. The company in last two years has expanded its business to SAARC countries and Russia. In a recent survey by TeleAnalysis, Micromax was the most popular Indian smartphone brand in the SAARC region. In Russia too, the company is placed at No. 3 position, and starting with this year, Micromax wants to expand to other CIS regions and Eastern European countries.

Besides all the above, Micromax’s co-founder Vikas Jain in a statement said it would invest another Rs 300 crore in setting up 3 more manufacturing plants. This would help the company produce all of its products locally manufactured which, at present, stands at 60%.

The Micromax 3.0 has one more thing which, I’m sure, must be there in the vision document but was not disclosed – to go public. The company has been trying to bring out its IPO for a long time now but issues mentioned above, and some failed external investment proposals had pulled it back. Hopefully, this new avataar of the company can lead Micromax to become India’s first public-listed smartphone brand.

Nuts, Guts & Glory

All said and done, dreams appear rosy as long as you are seeing it. Chasing it and putting a certain execution plan, is what required to make it come true. “I understand, the vision of Micromax 3.0 is now clearly defined. And we will start working on our execution plan starting today,” admits Sen. It would not be a cake walk for Micromax to reach where it wants in its vision ‘3.0’ as competition is fierce here, and Chinese brands with their deep pockets and mature smartphone production experience, can pose new threats to gain that edge over Indian brands. However, Micromax with an already established brand pull has many advantages, and the company can hold on to its glory, provided it goes nuts about innovations and shows guts in executing all that it had charted out in its vision 3.0.

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