RBV of Schneider’s foray in the Indian Retail Market
In partial completion of the course CTC, by Prof Srinivas Gunta, EPGP 2011-12
16th June 2012
Schnieder Electric: From RIN to VRIN
Schneider Electric till year 2011 was only targeting the large corporations and contractor market in India for its power generation and energy efficiency products. But this changed after the arrival of Oliver Blum to head the India operation. Blum decided to foray into the retail market to directly sell their products to the end customer. The retail foray gives Blum a huge opportunity to reach homes directly. Blum wanted to be present in every sector of electricity from power generation equipment to distribution to security systems across businesses and residential areas and finally reach the end user.
However to enter the retail market Schneider had to gain access to a retail network which the company never had. It had products that can be sold to this market but didn’t have the resources to access this market.
Blum hence decided to acquire Luminous Power Technologies Pvt Ltd which had around 25,000 retail outlets. This was a strategic move since now Schneider has gained access to the retail market to sell its Schneider branded premium electric products. It has also decided to rebrand some retail shops to exclusive stores selling only Schneider products. This will increase the visibility of the brand along with penetration in the retail market. The retail outlets will also continue to sell the Luminous brand, competing with leader Anchor, in the cheaper range.
To take a RBV on Blum’s strategy, clearly he wanted to generate more value from its premium products, that were so far only restricted to large institutions and contractors. By gaining access to a large market through the retail network it moved from RIN to VRIN, by making something that is rare (high