Hyundai plans product assault on Middle East

South Korean newcomer Hyundai Electronics is planning a major commercial assault on the Middle East consumer electronics and household appliance sector.

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By  Aaron Greenwood Published  May 9, 2006

South Korean newcomer Hyundai Electronics is planning a major commercial assault on the Middle East consumer electronics and household appliance sector. The company will rollout a comprehensive product portfolio as it aims to capitalise on the high-profile market presence of South Korean counterparts LG and Samsung in the region. “We must position our business by leveraging the popularity of South Korean consumer electronics brands in the Middle East,” said Rajiv Srivastava, general manager of Hyundai Electronics’ UAE division. “Initially, we must expand our product range and establish our channels. We don’t have the channel strength at present to ensure commercial success in this region.” Srivastava said that Hyundai Electronics aimed to capitalise on the success of the ‘soft launch’ last December of a select range of products across the Middle East. “Hyundai Electronics launched a range of LCD and plasma TVs in markets including Saudi Arabia and the UAE last year in a bid to boost the profile of the brand prior to a full-scale product launch,” he said. “This initial launch provided us with a vital insight into what consumers demand in this region, in terms of product features and prices. “We are now targeting a massive product launch from entry level through to top-end consumer electronics and household appliances.” Srivastava explained that Hyundai’s next-generation range of LCD TVs would kickstart the process. “Everything we launched last year will be scrapped,” he said. “We launched those products purely to test the market. We will unveil a whole new product line starting with the LCD TV range.” Srivastava said the range would be pitched as a premium offering in a bid to boost the company’s brand image across the region. In contrast, Hyundai’s range of DVD players and home cinema systems will be pitched as mid-market offerings and priced accordingly. In the household appliance sector, Srivastava said Hyundai planned a rapid rollout of products commencing this month with a range of air conditioners, microwaves, cookers, refrigerators and kettles. He said the company planned to introduce two washing machine models in July. “MP3 players will be introduced at a later stage,” he said. “We’re also currently studying the market with a view to introducing a range of entry-level digital cameras.” Srivastava explained that Hyundai Electronics was aggressively targeting distribution expansion opportunities across the region. “Hyundai currently has around 80 distributors worldwide and is committed to expanding its channel presence in the Middle East,” he said. “The company has already appointed distributors in Saudi Arabia, Kuwait, Syria, Yemen, and Libya. Admittedly, Hyundai Electronics’ profile is very low at present, but once the full product range is introduced, you can expect to see a major marketing push promoting its entry into the consumer electronics sector.” In the UAE, Srivastava said that the products would be initially stocked in Hyundai Electronics showrooms in Dubai, Sharjah, Abu Dhabi, and Al Ain. “We have also signed agreements with E-Max Electronics and Sharaf DG to stock the products,” he said. “We’re currently negotiating agreements with other retailers for specific products, including our plasma and LCD TV ranges.” He added that while the Hyundai expected to be present in hypermarkets in the future, independent retailers were key to the company’s initial plans in the region. “We are planning to enter the hypermarkets in the future, but independent retailers remain vital to our initial plans,” he said. “The major retailers here accept a few well-known brands, but unfortunately for newer players it comes down to how willing you are to negotiate on price as to whether they are interested in stocking your products. You have to ensure that you provide the right mix of features at the right price.”

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