Television: Banking on 3DTV as a key driver

There was a time when buying a TV was considered a one-off household purchase. In developed Asian markets at least, those days are long gone, thanks to constant technological upgrades and relatively low pricing.

Going forward, the region's leading electronics players are banking on 3DTV as a key revenue driver. Although the infrastructure for content distribution is still lacking in many markets, Dave McCaughan, regional strategic planning director for McCann Worldgroup, notes that this has not presented a hurdle for HDTV, which launched under similar circumstances.

"It is a rare event when software has to catch up with hardware development, but it will continue with the introduction of 3DTV to the mass market," he predicts.

Sony and Samsung can be expected to lead the development of the 3DTV market. While Sony has outlined the technology as its focus for regional growth, Gregory Birge, managing director of F5 Digital Consulting in Singapore, suggests that Samsung may already have the edge, thanks to strong advance planning. The company is the first to launch a full line up of 3D technology-enabled TVs in Korea.

However, while Samsung's models rely on glasses, Sony has been touting technology that does not require them. Both brands are optimistic about the potential of the FIFA World Cup to drive sales, although industry observers have suggested that, in Japan at least, pornography is also likely to be a key driver to the uptake of 3DTV products among male consumers.

But as exciting as the technology appears, it will be some time before it becomes a mainstream feature in the region, if at all, according to Jon Wright, regional director of analytics and insight at MEC. He cites price and infrastructure as barriers to takeup. "Mainstream adoption is likely to be a minumum of three to four years away," he says.

While Apple has yet to feature among the region's top ten TV brands, Scott Rhee, chief executive of Euro RSCG Korea, suggests that its products could emerge "as a potential rival to 3DTV brands as they attempt to make TVs smarter".

In terms of overall brand awareness within the sector, Sony, Samsung and LG dominate the region. Sony ranks first in eight of the ten markets surveyed in this year's report. Interestingly, however, it is outperformed by Sharp in its home market, while LG is the TV brand of choice in Korea.

The top two brands' marketing strategies vary significantly. Rather than relying on overt branding, Samsung has typically emphasised the functionality and design of its products. It has also benefited from an integrated retail programme that offers consumers separate Samsung home appliances at a lower price when purchasing a TV; Sony, meanwhile, continues to take a softer approach, with branding campaigns revolving around the theme of colour. It is also due to roll out an eco-friendly 'Green TV'-which it claims consumes 70 per cent less energy-at the end of July to appeal to a growing segment of ecologically conscious consumers.

"In general, product pricing and dealer incentives still work best as a convergence to sales," states Ryusuke Fukushima, a marketing strategist at Sony in Japan.

Unsurprisingly, advertising for TV brands continues to rely heavily on the TV platform, although campaigns are increasingly supported online with microsites. In-store and experiential marketing also remains a priority. In Korea, leading domestic brands operate TV flat panels in high traffic public areas such as malls, airports and subway stations as a means of showcasing their products and engaging potential buyers.

Outside of Japan and Korea, China undoubtedly offers the region's biggest growth potential. LCD flat panel sales are expected to triple between 2008 and 2012 (from 13 million to 37 million sets).

The market is currently dominated by local brands such as Changhong Electric and Hisense, although LG and Sharp have established local production facilities. And while Dutch brand Philips doesn't even advertise in Japan or Korea, it is an active presence in China. A differentiation strategy for the brand in that market is its 'Ambi-light' technology, which claims to offer viewers a semi-3D experience at a lower cost.

Top 10 television

1 Sony
2 Samsung
3 LG
4 Panasonic
5 Sharp
6 Toshiba
7 Philips
8 Hitachi
9 Tatung
10 Sanyo

This article was originally published as part of the 2010 Top 1000 Brands report.