Despite the country's economic slow-down, South Korea-based Thai Samsung Electronics has earmarked a Bt2.05-billion marketing budget to promote 300 new innovative products that will encourage sales to grow 25 per cent to Bt25 billion this year.

Of that amount, Bt10 billion is expected to come from audiovisual (AV) products, Bt8 billion from mobile phones, Bt4 billion from home appliances and Bt3 billion from information-technology (IT) products.

Arnut Changtrakul, deputy managing director for consumer electronics and IT operations, said the country's economic slow-down would affect consumer spending and have a negative impact on the home-electronics market, which is expected to show slight growth of less than 5 per cent this year.

But the company believes its marketing strategy of focusing on innovative products and the premium market will drive its sales to meet the growth target of 25 per cent this year, he said.

"We plan to introduce up to 300 innovative products to the market for all of our four product categories: 100 new home-appliance products, 80 AV products, 20 IT products and 100 mobile phones. That will drive our

sales to meet the target," he said.

Meanwhile, the company has set up a marketing budget of Bt2.05 billion to promote the new products and build up its premium brands this year. Of that, Bt800 million of the budget will be for promoting mobile phones; Bt600 million for AV products, particularly high-definition liquid-crystal-display and SlimFit televisions; Bt400 million for home appliances; and Bt250 million for IT products.

The company has a higher marketing budget this year because most of its new products are innovative ones that require more information in order for its customers to make a decision to buy. As a result, 60 per cent of the total marketing budget will be spent on below-the-line activities like event marketing and promotions at dealers' shops. The remaining 40 per cent will be used for television commercials and print advertising.

Thai Samsung Electronics company expects its premium products' to take up to 15 per cent of its total sales target this year, leaving 35 per cent for the middle market and 50 per cent for the economy market. The company believes that after launching more innovative products over the next three years, the share from its premium products will reach 30 per cent in 2009, Arnut said.

To achieve the company's target, the company has also reorganised its management in this year's first quarter, separating its home-appliance unit into three teams. Those are for air-conditioners, home appliances (refrigerators, washing machines and vacuum cleaners) and a Built-In team that focuses on commercial projects, with property developers using Samsung products in their built-in kitchens.

"We won't increase prices on our new products, because we've benefited from the baht's appreciation and our cost-saving policy. Thus, our new product prices are close to our existing models but offer more functions and designs, to meet customer demand," Arnut said.

"Although consumers continue to be concerned about their future earnings and delay their decisions to spend following the low economic growth and political uncertainty, we believe that when we introduce high-quality products at reasonable prices to our customers, our sales will grow enough to achieve our target. This is shown by our sales in the first four months of this year, which grew 50 per cent compared with the same period last year."

Somluck Srimalee

The Nation