Optical storage devices (CDs and DVDs) company Moser Baer India Ltd has charted out an aggressive retail strategy for the distribution of its home entertainment (video CDs and DVDs) business even as it plans to sell audio CDs for Rs20.
The company is working on a multi-tiered distribution model that includes selling its products at organized retail outlets such as Reliance Retail, tapping local retailers including the paan shops, small mom-and-pop stores, home video rental stores and stationery shops in smaller towns, as well as setting up its own exclusive Moser Baer outlets across major towns.
Moser Baer forayed into the home entertainment business in December last year, competitvely pricing its products way lower than its rivals. While CDs and DVDs were being sold for Rs150 and Rs300, respectively, Moser Baer priced its CDs at Rs28 and DVDs at Rs34, respectively. The company aims to generate around Rs250 crore from the entertainment business. Its total revenue in the fiscal year ended March was Rs2,061 crore.
“Indian consumers’ obsession for films is well known. After pricing our products low, and hence making it affordable for consumers, our next focus is on making it available to them,” said Ratul Puri, executive director, Moser Baer.
The company already has five exclusive outlets and it plans to have 300 such stores by 2009. Its video CDs and DVDs are currently available in markets such as Andhra Pradesh, Uttaranchal, Punjab, besides the four metros.
“In India, more than 300 movies are released every year, and going by the demand, we need to touch base with the customer once in every two days,” said Puri.
Even then, he said that covering 30% of his targeted market will take another two years. Currently, the company has 450 distibutors across all channels that service around 150,000 retail outlets in India.