• 1. Date : June 2003 Prepared by : ACNielsen International Hong Kong Prepared for : Philips LightingCustomer eQTM Study for Philips Lighting Wave 4 - Regional Presentation
    • 2. Background Research Objectives Methodology Sample Philips Lighting eQTM Model Overview of findings Strategic Resource Allocation Executive Insights and Recommendations Individual Country Diagnostics AppendicesPresentation Outline
    • 3. BackgroundPhilips Lamps and Philips Luminaires conducted their own Customer eQ surveys separately before 2002. After the integration of the three business units of Philips Lighting, a merged Customer eQ survey was conducted starting from Quarter 4 of 2002 to cover the customers of Lamps, Luminaires and Lighting Electronics (LE).
    • 4. ObjectivesPhilips Lighting wishes to: Understand the requirements of their business customers and how to build a strong relationship for future growth Identify critical improvement areas Identify competitive strengths and weaknesses Allocate resources appropriately
    • 5. MethodologyCustomer eQTM of ACNielsen adopted for this study Customer lists provided by Philips Lighting in all markets Sampling method: Top customers selected for interviews in Korea, New Zealand, Pakistan and Hong Kong Census (in selected cities/regions) conducted in Indonesia, Singapore, Malaysia, Thailand and the Philippines Pre-notification letters sent by Philips to invite the participation of the target customers Face-to-face interviews using a standardized questionnaire conducted in all countries (The questionnaire used in the Philippines is slightly different from the other countries.) Fieldwork period: Nov - Dec 2002: Korea, Malaysia, New Zealand, Pakistan, Singapore Jan - Mar 2003: Hong Kong, Indonesia and Thailand Apr - May 2003: the Philippines
    • 6. Surveyed MarketsThe following Asia Pacific countries are covered in this study:
    • 7. Target SampleBusiness customers who have used or purchased the products of Philips Lighting in the past 12 months: Direct customers – buy or use the products of Philips Lighting Indirect customers For all countries except the Philippines: Indirect luminaires customers – specify or recommend luminaires products to their own clients, but are not the end-users of the products. For the Philippines: 2nd Tier customers – purchase Philips’ products from the exclusive distributors of Philips The eligible respondents must be : the key persons of their companies dealing with Philips Lighting and are responsible for / at least have some influence on purchase decisions for lighting products.
    • 8. Sample Profile - Customer Type Base: All respondents (Direct customers only for the Philippines)N.B.: For the Philippines, we will focus on the Direct customers sample only in this report. Data weighting was conducted to maintain equal weight of all VCOs in the total sample of Direct customers. The findings for the 2nd Tier customer sample will be presented in a separate section at the end of this report.
    • 9. Sample Profile - by Product Purchased from Philips N.B.: In this presentation, we can construct the trend of Philips performance evaluated by lamp customers only. Base: All respondents (Direct customers only for the Philippines)There are considerable overlaps in the customers buying Lamps, Luminaires and LE in all countries, except Korea.
    • 10. Philips Lighting eQ™ Model
    • 11. Customer eQTM used for this study. A strategic tool developed by ACNielsen Designed to measure and manage the equity of customers which has an influence on company’s business growth/success
    • 12. Loyalty / SupportBiz Growth/ ExcellenceBehavior ABehavior BFactor BFactor CFactor AAttribute AAttribute BAttribute CAttribute XCustomer eQ™ Model
    • 13. Customized to your Organization’s needsCustomer eQ™ Provides a reliable measure of your performanceIdentifies precisely what drives ‘loyalty’ or behavior Relevant recommendationsCustomer eQ™ ModelPrioritize ActionsImportance MeasurementActionable InformationBehavioral Scale
    • 14. Customer eQ™ Model Customized to your Organization’s needsRelevant recommendationsCustomer eQ™ ModelThe eQ™ Model comprises all the factors and attributes included in the eQ™ questionnaire which have an impact on customer satisfaction. Factors and attributes were determined in consultation with Philips Lighting. The eQ™ Models for Trade customers and Project & OEM customers are slightly different, in order to reflect the various needs and requirements of different types of customers.
    • 15. Philips Lighting eQ™ Model - TradePURCHASE FROM PHILIPS/ GROW PHILIPS BUSINESSPRODUCTORDER & DELIVERYPRICING & INVOICINGCUSTOMER SERVICEProduct quality Product life time Product range Strong packaging New product intro. Value for money Coherent pricing policy Accuracy of invoicesCondition of goods on arrival Stock availability** Punctuality Accuracy of delivery Ease of ordering Time between order & delivery*** Ability to meet short term notice order*Quality of technical support Timely technical support Product support and training Biz support and training Merchandising support Ad. and promotional support Incentive schemes Keeping you informed of Ad & sponsor deals Trade margin Credit termsAccessibility Attitude Handling of complaints Handling of return /defectivesAvailability & accessibility Attitude Product & biz.knowledge Ability to handle enquiries straightawayBIZ & TRADE SUPPORTSALES REPSNote: * applies to purchase of Luminaires only ** applies to purchase of Lamps or LE only *** applies to those without a fixed delivery scheduleAttributes for Trade customers only
    • 16. eQ™ Model - Project Customers and OEMPURCHASE FROM PHILIPS/ GROW PHILIPS BUSINESSPRODUCTORDER & DELIVERYPRICING POLICY & INVOICINGCUSTOMER SERVICEProduct quality Product life time Product range Strong packaging Tech.advanced/ innovative products Aesthetics*Value for money Coherent pricing policy Accuracy of invoicesCondition of goods on arrival Stock availability** Punctuality Accuracy of delivery Ease of ordering Time between order & delivery*** Project schedule’s lead time*Quality of technical support Timely technical support Ability to provide design solutions*Accessibility Attitude Handling of complaints Handling of return /defectivesAvailability & accessibility Attitude Product & biz.knowledge Ability to handle enquiries straightawayBIZ & TRADE SUPPORTSALES REPSNote: * applies to purchase of Luminaires only ** applies to purchase of Lamps or LE only ** applies to those without a fixed delivery scheduleAttributes for Project customers & OEMs only
    • 17. Importance MeasurementAsk customers directly which factors are most and least important to them Assign a weight of 100 to the most important and a weight of 1 to the least important Assign a weight for all other factors relative to these anchor pointsIdentifies precisely what drives ‘loyalty’ or behavior Prioritize ActionsImportance Measurement
    • 18. Performance Measurement Behavioral Scale Reflects customer’s own experience, linked to actual behavior Uses customer language to describe levels of performance Removes abstract meanings of scales; customers know exactly what is being measured ActionableProvides a reliable measure of your performanceActionable InformationBehavioral Scale
    • 19. Customer eQ™ Customer eQ™ ModelImportance MeasurementPerformance Measurement Philips eQ™ Model - factors and attributes Importance rating of factors and attributesRating of Philips / competitors on attributes
    • 20. Overview of Findings
    • 21. eQ™ Index Measures the overall performance of company, taking all the factors in the model into consideration, and weighted by importance
    • 22. Overall eQ™ Index(n=45) (n=50) (n=67) (n=42) (n=102) (n=66) (n=16) (n=29) (n=37)Base: All respondents (Direct customers only for the Philippines) The customer equity of Philips is fairly good across the countries. Philips has the strongest relationship with the customers in New Zealand.
    • 23. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)N.B.: Trend data analysis is not conducted for the Philippines as the sample of this wave for this market is considerably different from the previous waves. Lamps customers’ overall evaluation of Philips remains stable in all countries since the last survey in 2000, except a slight increase in New Zealand and a slight drop in Hong Kong.
    • 24. Overall eQ™ Index of Philips - by Customers of Various Products(n=45) (n=50) (n=67) (n=42) (n=102) (n=66) (n=16) (n=29) (n=37)Base: All respondents (Direct customers only for the Philippines) N.B.: Considering the overlapping of customers of the three product categories, analysis by customers of various products is not conducted in this report.No obvious difference in the evaluation on Philips by customers buying Lamps, Luminaires and LE mainly due to the overlapping of these customers.
    • 25. Overall eQ™ Index - Philips Vs. Osram Vs. GEN.B.: India is not included in this chart because the base size for Osram and GE is too small. The Philippines is also not included since we only ask the Direct customers to evaluate the performance of Philips only. Osram is quite strong and stronger than Philips in HK, Indonesia, Korea and Thailand. In Pakistan and Singapore, the two brands are on a par. Philips is leading over both Osram and GE in New Zealand and Malaysia only. GE is weaker than Philips in all countries except Indonesia and Singapore.
    • 26. Most ImportantLeast ImportantCommitment Drivers‘Products’ remains the top concern of Philips’ customers, followed by ‘Pricing & invoicing’ and ‘Order & delivery’. ‘Order & delivery’ is more important in the Philippines. ‘Business & Trade support’ is considered to be the least important in most countries.
    • 27. N.B.: Products Pricing & Invoicing Order & Delivery Sales Reps Customer Service Staff Biz. & Trade SupportDenotes statistically significant rise/fall in performance score given by Lamps customers at 90% confidence interval over the previous wave.SINPHIFactor Performance PAKNZMAL58 60 58 59 66 38HKPhilips is performing well on ‘Products’ and ‘Pricing & Invoicing’ in all countries except in Hong Kong. ‘Order & Delivery’ and ‘Business & Trade support’ are weaker areas for Philips across the nine countries except in New Zealand. Philips’ performance is very good in New Zealand, with weighted top-2-box of over 70% on all factors. (Weighted Top-2-box %)67 81 49 62 72 3975 74 52 76 63 4578 63 55 76 67 5178 87 72 83 87 7372 82 74 67 63 3770 72 47 66 54 5669 65 54 72 75 4173 67 44 55 54 38KORINDOTHA
    • 28. Strategic Resource Allocation
    • 29. The strategic resource allocation maps the importance of a factor against the performance of Philips Lighting relative to the competition*. identify priorities for resource allocation based on the competitive strengths and weaknesses. Strategic Resource Allocation - Philips vs. Competitors*Average of all competitors rated by the respondents.
    • 30. Regional Summary - Strategic Resource Allocation -
    • 31. Executive Insights & Recommendations
    • 32. Regional Level InsightsPhilips has maintained a satisfactory level of customer equity in the Asia Pacific region, with eQ Indices of 70 or above. The customer satisfaction with Philips is the strongest in New Zealand and the weakest in the Philippines and Thailand. The overall customer loyalty of Lamps customers with Philips remains stable since the last survey in 2000. In Pakistan, Malaysia, Singapore and Indonesia, Philips is on a par with the competition on an overall level and should strive for differentiation from the competition. Osram appears to be slightly stronger than Philips in Hong Kong, Korea and Thailand. Philips needs to make special efforts to catch up with Osram in these markets.
    • 33. Regional Level Insights‘Products’ is the competitive strength of Philips in most countries, which should continue to be leveraged on to further enhance the customer equity. However, it should be noted that in Hong Kong, Philips is considered weaker than both Osram and GE on Lamps products and weaker than Thorn on Luminaires products. ‘Pricing & Invoicing’ is another factor of high importance to Philips’ customers. It is a critical competitive parity for Philips in Indonesia, Korea, Malaysia and Singapore, where Philips should turn it into a competitive strength. The common critical area for improvement across the countries is ‘Order & delivery’, except New Zealand and Pakistan. Philips should take immediate improvement actions in these countries to catch up with the competition. Improvements on ‘Sales representatives’ in Hong Kong and ‘Business & Trade support’ in Thailand are also important.
    • 34. Country Level InsightsPhilips’ performance is the most satisfactory in New Zealand. It is the best performer on all factors among all major brands in the market. Philips should maintain its leading position by further improvement on weaker areas on ‘Products’ and ‘Order & delivery’. Besides, special attention should be paid to Trade Professional customers, as they are the important customer segment and less satisfied with Philips. In Pakistan, Malaysia, Singapore and Indonesia, the main target of Philips should be to stand out from the competition and establish its leading position in the market. In Pakistan, Philips is performing well but only on a par with Osram and Sun on an overall level. Philips should try to benchmark its performance on ‘Sales representatives’ with those of Osram who are performing very well; differentiate from Osram and Sun on ‘Pricing & Invoicing’. In Malaysia, Philips is just marginally stronger than Osram and GE. It needs to further widen its performance gap with these two competitors. Top priority is to improve its ‘Order & delivery’ services on which Osram and GE are perceived as stronger than Philips. Should also make efforts to differentiate from Osram and GE on ‘Pricing & invoicing’, by further improvement on ‘Coherent pricing policy’ and ‘Value for money’ of Philips’ products.
    • 35. Country Level InsightsIn Singapore, all the key lighting brands have very similar overall performance, with eQ Index ranging from 74 to 77. A thorough review and immediate improvement actions on ‘Order & delivery’ is critical for Philips to stay ahead of the competition. ‘Sales representatives’ and ‘Customer service staff’ are the secondary areas for improvement, as Philips is still weaker than the competition on some aspects. Trade customers should be given more attention in the improvement plan. In Indonesia, Philips’ overall performance is similar to most of the key competitors. Similar to most of the other countries, ‘Order & delivery’ should be the critical area for improvement. Philips also needs to further enhance the customers’ perception on its Luminaires products and improve the range and packing strength of Lamps products. ‘Pricing & Invoicing’ also needs improvement as Philips’ performance on this factor has dropped significantly in the past two years.
    • 36. Country Level InsightsIn Hong Kong, Korea and Thailand, Philips should catch up and benchmark its performance with Osram’s. In Hong Kong, it is noteworthy that Osram is performing very well and has taken over the leading position from Philips in this wave. In order to resume its competitive edge, Philips needs to take immediate improvement actions on all factors except ‘Business & Trade support’: Top priority is to improve the customers’ perception on its ‘Products’, especially on durability and quality, and, Should align its performance on ‘Order & Delivery’ and ‘Sales representatives’ with that of Osram Areas of lower priority for improvement are ‘Value for money’ of its products and ‘Customer service staff’. In Korea, Osram is either on a par with or stronger than Philips on all areas driving customer equity. Immediate improvement actions are required on ‘Order & delivery’, with focus on ‘Stock availability’ and ‘Ability to meet project schedule’. Philips also needs to further differentiate its Lamps products from Osram and improve customers’ perception on the ‘Value of money’ of its products. ‘Customer service staff’ is the next area to be addressed in the improvement plan. OEM, Direct Project and Indirect Project customers require special attention.
    • 37. Country Level InsightsIn Thailand, Philips’ overall performance is slightly weaker than Sylvania and Osram. Philips should try to outperform these two brands. ‘Business & Trade support’, ‘Order & delivery’ and ‘Sales representatives’ are the critical areas for improvement, where Philips is considered weaker than the competition. Modern retail customers require extra attention from Philips as they are the 2nd most important customer segment but the least satisfied with Philips. In the Philippines, the VCOs and Trade Professional customers are satisfied with Philips’ performance. On contrast, OEMs and Modern Retail customers are less positive on all areas and thus required additional improvement efforts from Philips. Apart from ‘Order & delivery’, Philips also needs to improve its ‘Business & Trade support’, ‘Customer services staff’ and ‘Sales representatives’ for OEM and Modern Retail customers. All the five VCOs in the Philippines have very strong relationship with the 2nd Tier customers of Philips. ‘Order & delivery’ is a key area for improvement for all the VCOs. In addition, each VCO needs further improvement on the areas that they are currently weaker than the distributors of Osram and/or GE.
    • 38. Individual Country Diagnostics
    • 39. Hong Kong
    • 40. Sample Profile – by Customer Type
    • 41. Base: Those who rated the respective brands.Overall eQ™ Index (Q1 2003)(n=45)(n=17)(n=11)(n=13)Philips Lamps Vs. competition Q4’01 Q1’03 Philips 76 73 Osram 72 80 Thorn NA 72 GE 67 68eQ Norm for HK: 70
    • 42. Commitment Share Measures the proportion of customers who are more likely to be committed to company since their more important needs are met with a high level of performanceVulnerable Share Measures the proportion of customers who are more vulnerable to supporting competition since their more important needs are met with a rather low level of performance
    • 43. Commitment / Vulnerable Shares (Q1 2003)Vulnerable sharePhilips (n=45) Thorn (n=17) Osram (n=13) GE (n=11) Commitment shareBase: Those who rated the respective brands.Philips’ customers appear to be more loyal to Osram than to Philips
    • 44. Overall eQ™ Index of Philips - by Customer Type (Q1 2003)Base: All respondentsDirect CustomersIndirect Customers(n=11)(n=11)(n=19)(n=45)(n=34)#Caution - small base(n=4#)
    • 45. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 46. Overall Impact & Performance (Q1 2003)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: All respondentsccBiz. & Trade supportOrder & DeliveryCustomer Service StaffSales RepsPricing & InvoicingProducts IMPORTANCENote: Philips has big middle-boxes (25-41%) and very small bottom boxes for all factors.Key areas for improvement
    • 47. Weighted top-2-box %Overall Performance of Philips - Lamps Customers (Trend Data)Base: Those who buy Lamps products from Philips.
    • 48. Critical Area for Improvement - Lamp Products - Performance Gap Analysis - ATTRIBUTES N.B.: a, b or c denote statistically significant difference at 90% confidence interval.Osram(n=29)(n=13)cBase: Those customers who consider Lamps the most important product category to their business.#Caution - small baseProduct life timeProduct qualityProduct rangeNew product introductionStrong packagingTech. Advanced/innovative products(n=6#)GEBetterWorse
    • 49. ATTRIBUTESThornProduct life timeProduct qualityProduct rangeStrong packagingTech. Advanced/innovative productsBase: Those customers who consider Luminaires the most important product category to their business.Aesthetics#Caution - small base(n=16)(n=13)(n=5#)GE N.B.: a, b or c denote statistically significant difference at 90% confidence interval.aacccBetterWorseCritical Area for Improvement - Luminaires Products - Performance Gap Analysis -
    • 50. Thorn(n=33) (n=8#) (n=13) (n=7#)ATTRIBUTESBase: Those who deal with Philips on Order & Delivery.Condition of Goods on arrivalStock AvailabilityPunctualityAccuracy of DeliveryTime Between Order & DeliveryEase of OrderingAbility to meet short term notice order requestAbility to meet project schedulesOsramGE#Caution - small baseabaa N.B.: a, b, c or d denote statistically significant difference at 90% confidence interval. BetterWorseCritical Area for Improvement - Order & Delivery - Performance Gap Analysis -
    • 51. ATTRIBUTESBase: Those who rated the respective brands N.B.: a, b, c or d denote statistically significant difference at 90% confidence interval. ThornOsramGE (n=45) (n=17) (n=13) (n=11)Ability to handle enquiries straightaway Product & Biz knowledge Availability & accessibility AttitudeBetterWorseCritical Area for Improvement - Sales Reps - Performance Gap Analysis -
    • 52. Hong Kong - Executive SummaryPhilips has achieved an eQ Index of 73 in Hong Kong, which is slightly above the norm for Hong Kong. It is on a par with Thorn, slightly stronger than GE but weaker than Osram. It should be noted that Philips is lagging behind Osram in this wave. However, it used to be stronger than Osram in Q4 2001. Overall eQ Index (Lamp customers) Q4 2001 Q1 2003 Philips 76 73 Osram 72 80 The overall performance of Philips has deteriorated on most factors, except for ‘Pricing & Invoicing’ and ‘Business and Trade Support’. Osram is performing very well and considerably stronger than the other brands on ‘Products’, ‘Order & Delivery’, ‘Sales Representatives’ and ‘Customer Service Staff’. To catch up with Osram and resume the leadership position in lighting products in Hong Kong, further improvement is needed for Philips on all factors except for ‘Business and Trade Support’.
    • 53. ‘Products’ used to be a competitive strength of Philips in Hong Kong. However, in this survey, Philips’ products are thought to be weaker than those of Osram and GE on lamps and weaker than Thorn on Luminaires. =>Philips should take immediate steps to improve the customers’ perception on its ‘Products’. Communication on durability and quality of Philips needs to be further strengthened. Philips should continue to improve its ‘Order & Delivery’ as the current performance is still lagging behind the competition. ‘Time between order & delivery’, ‘Ability to meet project schedules’ and ‘Stock availability’ are the key areas for further improvement. Philips’ sales representatives also need improvement since they are performing not as well as those of the competitive brands on all areas except ‘Attitude’. Hong Kong - Executive Summary
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    • 58. Commitment / Vulnerable Shares (Q1 2003)Vulnerable sharePhilips (n=50) National (n=11) Artolite (n=8#) Thorn (n=5#) Chiyoda (n=5#) GE (n=4#) Osram (n=3#) Commitment shareBase: Those who rated the respective brands. # Caution - Small base
    • 59. Overall eQ™ Index of Philips - by Customer Type (Q1 2003)Base: All respondents#Caution - small baseIndirect CustomersDirect Customers (n=50) (n=32) (n=21) (n=5#) (n=3#) (n=3#) (n=18)
    • 60. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 61. Overall Impact & Performance (Q1 2003)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCENA N.B.: a, b, c, d, e or f denote statistically significant difference at 90% confidence interval.aNAKey area for improvement
    • 62. PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccHigherLowerIMPORTANCEBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProductss N.B.: ‘s’ denotes statistically significant difference at 90% confidence interval between Q2 2001 and Q4 2002. sOverall Performance of Philips - Lamps Customers (Trend Data)Dropped performance
    • 63. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProductsBiz & Trade supportStrategic Resource Allocation - Philips Vs Competition*Customer services staffN.B.: *Average of all competitors rated by the respondentsOrder & deliveryPricing policy & InvoicingSales representatives
    • 64. (n=33) N.B.: a, b, c, d, e or f denote statistically significant difference at 90% confidence interval. (n=1#)(n=5#)#Caution - small baseATTRIBUTESBase: Those who deal with the respective brands on Order & Delivery.Stock availabilityPunctualityAccuracy of deliveryTime between order & deliveryEase of orderingAbility to meet short term notice order requestAbility to meet project schedulesaaCondition of goods on arrivalNationalArtoliteChiyodaGE(n=2#)(n=3#)Osram(n=5#)aaacaaCritical Area for Improvement - Order & Delivery - Performance Gap Analysis
    • 65. Area for Improvement - Lamps Products - Performance Gap AnalysisATTRIBUTES N.B.: a, b, c, d, e or f denote statistically significant difference at 90% confidence interval.Base: Those customers who consider Lamps the most important product category to their business.#Caution - small baseProduct life timeProduct qualityProduct rangeNew product introductionStrong packagingTech. Advanced/innovative productsChiyoda(n=30)(n=5#)b(n=4#)National(n=3#)(n=2#)GEOsrambbcd
    • 66. ATTRIBUTESProduct life timeProduct qualityProduct rangeStrong packagingTech. Advanced/innovative productsBase: Those customers who consider Luminaires the most important product category to their business.Aesthetics#Caution - small baseNationalArtolite(n=19)(n=6#)(n=7#)b(n=5#)Thorn(n=1#)OsramGEbcNew product introduction(n=1#) N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval.Area for Improvement - Luminaires Products - Performance Gap Analysis
    • 67. Indonesia - Executive SummaryPhilips’ overall performance in Indonesia is just on par with the country norm, with an eQ Index of 73. The customer equity among Lamps customers remains at the same level as the last survey in the Quarter 4 of 2000. However, Philips is facing keen competition in the market. Osram, National and GE are performing equally well. Hence, Philips needs to strive for ways to further enhance the customer equity in order to establish its leading position in the lighting product market. Philips should further improve the customers’ perception of its ‘Products’. This should be of the top priority as it is the most important factor affecting customers’ loyalty and Osram is perceived to be stronger than Philips. All product attributes for Luminaires except ‘product quality’ and ‘aesthetics’ require improvement. For Lamps, ‘Product range’ and ‘Strong packaging’ need further enhancement.
    • 68. Philips is lagging behind the competition in all aspects of ‘Order & Delivery’ which is another key factor driving customer equity. A thorough review and improvement of the current logistic system is necessary. Though Philips is still doing quite well on ‘Pricing & Invoicing’, its performance has significantly deteriorated in the past two years and Osram and GE are also performing well. Further improvement is recommended on ‘Coherent pricing policy’ and ‘Value for money’. ‘Sales representatives’ and ‘Customer service staff’ are the next areas to be addressed. The improvement efforts should have focus on specific customer segments where evaluation of Philips is lower: ‘Sales representatives’: ‘Product & Business knowledge’ of those salespeople who are responsible for Trade Retail, Modern Retail and Trade Professional accounts ‘Ability to handle enquiries straightaway’ of all salespeople except for those handling Modern Retail accounts Indonesia - Executive Summary
    • 69. ‘Customer service staff’: ‘Handling of complaints’ from Trade Retail and Modern Retail customers ‘Accessibility’ for Trade Professional customers ‘Handling of returns/defectives’ from Modern Retail customers Indonesia - Executive Summary
    • 70. Korea
    • 71. Sample Profile – by Customer Type
    • 72. Base: Those who rated the respective brands.Overall eQ™ Index (Q4 2002) (n=67) (n=32) (n=14) (n=11) (n=9#)#Caution - small baseeQ Norm for Korea: 70
    • 73. Commitment / Vulnerable Shares (Q4 2002)Vulnerable shareCommitment shareBase: Those who rated the respective brands.Philips (n=67) Osram (n=32) GE (n=14) Kumho (n=11) Shinkwang (n=9#)#Caution - small basePhilips’ customers are more loyal to Osram than to Philips.
    • 74. Overall eQ™ Index of Philips - by Customer Type (Q4 2002)Direct CustomersIndirect Customers#Caution - small baseDirect CustomersBase: All respondents (n=67) (n=62) (n=31) (n=13) (n=11) (n=7#) (n=5#)
    • 75. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 76. Overall Impact & Performance (Q4 2002)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCE N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval.aaKey area for improvement
    • 77. The performance of Philips has improved or maintained at the same level on all factors except ‘Order & delivery’. PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccHigherLowerIMPORTANCEs N.B.: ‘s’ denotes statistically significant difference at 90% confidence interval between Q2 2001 and Q4 2002. ProductsBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingDropped performance
    • 78. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProductsStrategic Resource Allocation - Philips Vs Competition*N.B.: *Average of all competitors rated by the respondentsBiz & Trade supportOrder & DeliveryPricing & InvoicingCustomer services staff Sales representatives
    • 79. Base: Those who deal with the respective brands on Order & Delivery. N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval. OsramGE(n=65)(a)(n=14)(c)(n=32)(b)ATTRIBUTES(n=11)(d)KumhoabcaStock AvailabilityPunctualityAccuracy of DeliveryEase of OrderingAbility to meet short term notice order requestAbility to meet project schedulesCondition of Goods on arrivalTime Between Order & DeliveryShinkwanga(n=9#)(e)Critical Area for Improvement - Order & Delivery - Performance Gap Analysis
    • 80. ATTRIBUTESBase: Those who rated the respective brands.#Caution - small baseSecondary Area for Improvement - Customer Service Staff - Performance Gap Analysis Handling of complaintsAttitudeHandling of returns/defectivesAccessibility N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval. aad(n=67) (n=32) (n=14) (n=11) (n=9#)OsramGEKumhoShinkwangdadaac
    • 81. Korea - Executive SummaryPhilips has maintained a fairly good level of customer equity in Korea, with an Overall eQ™ Index of 75. It is marginally stronger than GE, Kumho and Shinkwang but slightly behind Osram. Philips’ performance on most factors is quite good or mediocre, except ‘Order & delivery’ and ‘Business & Trade support’. Osram is either on a par or stronger than Philips on all areas. Facing the keen competition, Philips should strive for ways to outperform Osram and further enlarge its performance gap with GE, Kumho and Shinkwang. ‘Products’ is a competitive strength for Philips on an overall basis. However, on Lamps Philips still need to continue to differentiate its products from Osram. ‘Pricing & Invoicing’ is a critical competitive parity for Philips. To stay ahead of the competition, Philips needs to further improve customers’ perception on the ‘Value for money’ of Philips products.
    • 82. ‘Order & Delivery’ is the most critical area for improvement since Philips’ current performance is very weak and weaker than all the main brands. Priorities should be given to strengthening ‘Stock availability’ and ‘Ability to meet project schedules’. ‘Ease of ordering’, ‘Time between order & delivery’ and ‘Ability to meet short notice order request’ also need further improvement. ‘Customer service staff’ should be the next area to be addressed in the improvement plan. OEM, Direct Project and Indirect Project customers require special attention. Focus should be put on ‘Handling of complaints’, ‘Handling of returns/defectives’ and ‘Accessibility’. Improvement actions in ‘Sales representatives’ and ‘Business & Trade support’ should be of the lowest priority as they are the least important in determining the customer equity.Korea - Executive Summary
    • 83. Malaysia
    • 84. Sample Profile – by Customer TypeBase: All respondents
    • 85. Base: Those who rated the respective brands. (n=42) (n=16) (n=11) Overall eQ™ Index (Q4 2002)eQ Norm for Malaysia: 73
    • 86. Commitment / Vulnerable Shares (Q4 2002)Vulnerable shareCommitment shareBase: Those who rated the respective brands.Philips (n=42)Osram (n=16)GE (n=11)
    • 87. eQ™ Index of Philips - by Customer Type (Q4 2002)Direct CustomersIndirect Customers#Caution - small baseDirect CustomersBase: All respondents (n=42) (n=35) (n=24) (n=7#) (n=4#) (n=7#)
    • 88. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 89. Overall Impact & Performance (Q4 2002)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCEKey area for improvement
    • 90. Lamps Customers’ evaluation on Philips has improved on ‘Products’, ‘Order & delivery’ and ‘Biz & Trade support’ since the Quarter 4 of 2000.PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.HigherLowerIMPORTANCEBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts
    • 91. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProductsBiz & Trade supportStrategic Resource Allocation - Philips Vs Competition*Customer services staffN.B.: *Average of all competitors rated by the respondentsOrder & deliveryPricing policy & InvoicingSales representatives
    • 92. Critical Area for Improvement - Order & Delivery - Performance Gap Analysis Base: Those who deal with the respective brands on Order & Delivery.OsramGE(n=38)(a)(n=11)(c)(n=15)(b)ATTRIBUTESCondition of Goods on arrivalStock AvailabilityPunctualityAccuracy of DeliveryEase of OrderingAbility to meet short term notice order requestab N.B.: a, b or c denote statistically significant difference at 90% confidence interval. Time Between Order & DeliveryAbility to meet project schedules
    • 93. Malaysia - Executive SummaryPhilips has maintained a fairly good level of customer equity in Malaysia, with an eQ Index of 76, which is marginally stronger than Osram and GE. The loyalty level of Lamps customers to Philips has increased slightly since the last survey in 2000. Indirect Project customers are the most satisfied with Philips’ performance, while Modern Retail customers appear to be the least satisfied segment. Philips Malaysia should strive for ways to further widen it performance gap with the competition and strengthen its leading position in the lighting product market. ‘Products’ is the competitive strength of Philips in both the Lamps and Luminaires categories, which should be leveraged on. ‘Order & Delivery’ is the top priority for improvement plan, as Philips’ current performance is quite weak and weaker than Osram and GE. Immediate improvement actions are required on ‘Stock availability’, ‘Time between order & delivery’ and ‘Punctuality’.
    • 94. ‘Pricing & Invoicing’ is the most important consideration of the customer and a critical competitive parity for Philips in Malaysia. Philips should make efforts to stand out from the competition. Improvement efforts are required to improve the following: ‘Coherent pricing policy’ among Project, OEM and Modern Retail customers Trade Retail customers’ perception on ‘Value for money’ of Philips’ products For ‘Sales representatives’, ‘Business & Trade support’ and ‘Customer Services Staff’, Philips should maintain the overall performance and pay attention to areas where the current performance is still weak: Customer service: ‘Accessiblity’, ‘Handling of complaints’ and ‘Handling of returns/defectives’ Sales reps: ‘Ability to handle enquiries straightaway’ Business & Trade support: ‘Incentive schemes’, ‘Trade margin’ and ‘Credit terms’ Malaysia - Executive Summary
    • 95. New Zealand
    • 96. Sample Profile – by Customer TypeBase: All respondents
    • 97. Base: Those who rated the respective brands.Overall eQ™ Index (Q4 2002) (n=102) (n=60) (n=32) (n=22) (n=16) (n=14)eQ Norm for NZ: 74
    • 98. Philips has the highest Commitment share and the lowest Vulnerable share in the competition, which indicates the best customer loyalty.Vulnerable shareCommitment shareBase: Those who rated the respective brands.Philips (a) (n=102) Thorn (b) (n=60) Sylvania (c) (n=32) Osram (d) (n=22) Pierlite Clipsal (e) (n=16) GE (f) (n=14)c N.B.: a, b, c, d, e or f denote statistically significant difference at 90% confidence interval.
    • 99. Overall eQ™ Index of Philips - by Customer Type (Q4 2002)Indirect Customers#Caution - small baseDirect CustomersBase: All respondents (n=102) (n=82) (n=64) (n=15) (n=3#) (n=20)Require special attention from Philips as they are the biggest customer segment for Philips but less satisfied than the others
    • 100. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 101. Overall Impact & Performance (Q4 2002)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCE N.B.: a, b, c, d, e or f denote statistically significant difference at 90% confidence interval.cefbcdefcdd
    • 102. Philips has made progress on all factors among Lamps customers, especially on ‘Sales representatives’. PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccHigherLowerIMPORTANCEs N.B.: ‘s’ denotes statistically significant difference at 90% confidence interval between Q2 2001 and Q4 2002. Biz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts
    • 103. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProducts Order & Delivery Pricing & InvoicingStrategic Resource Allocation - Philips Vs Competition*N.B.: *Average of all competitors rated by the respondentsSales representatives Customer services staff Biz & Trade support
    • 104. New Zealand - Executive SummaryIn New Zealand, Philips has established its leading position in the lighting market. Its current performance is very good and stronger than Thorn, Sylvania, Osram, Pierlite Clipsal and GE in all factors driving customer equity. ‘Products’, ‘Order & Delivery’ and ‘Pricing & Invoicing’ are the critical competitive strengths for Philips since they are the top considerations of customers. Philips should further strengthen its edge in these areas by improving the following: ‘Products’: ‘Product life time’ and ‘New product introduction’ for Lamps; ‘Product life time’, ‘Aesthetics’ and ‘Strong packaging’ for Luminaires. ‘Order & Delivery’: Top priority should be given to improvement on ‘Stock availability’ and ‘Time between order & delivery’.
    • 105. On ‘Sales Representatives’, ‘Customer service staff’ and ‘Business & Trade support’, no immediate improvement action is required. Philips can just maintain its current performance. Trade Professional customers is the biggest customer segment to Philips in terms of sales value. It constitutes about two-third of the national sales of Philips in New Zealand. However, they are less satisfied with Philips in most areas than the other types of customers. Philips should understand their needs better and further improve the services provided to them. New Zealand - Executive Summary
    • 106. Pakistan
    • 107. Sample Profile – by Customer TypeBase: All respondents
    • 108. Base: Those who rated the respective brands. # Caution - Small base (n=66) (n=10) (n=8) (n=7#) (n=7#)Overall eQ™ Index (Q4 2002)
    • 109. Commitment / Vulnerable Shares (Q4 2002)Vulnerable sharePhilips (n=66) Osram (n=10) OHMS (n=8#) Sun (n=7#) Khyber (n=7#)Commitment shareBase: Those who rated the respective brands. # Caution - Small basePhilips’ customers show similar level of commitment towards Philips, Osram and Sun.
    • 110. Overall eQ™ Index of Philips - by Customer Type (Q4 2002)Base: All respondentsDirect CustomersIndirect Customers(n=11)(n=21)(n=31)(n=66)(n=55)#Caution - small base(n=3#)
    • 111. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 112. The loyalty of Lamps customers to Philips has slightly increased in Q4 2002.Vulnerable shareCommitment shareBase: Those customers who purchase Lamps products from Philips.
    • 113. Overall Impact & Performance (Q4 2002)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: All respondentsccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCENA N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval.ceceea
    • 114. Lamps Customers’ evaluation on Philips has improved on all factors, especially on ‘Customer service staff’ and ‘Biz & Trade support’. PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProductsHigherLowerIMPORTANCEss N.B.: ‘s’ denotes statistically significant difference at 90% confidence interval between Q2 2001 and Q4 2002.
    • 115. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProductsBiz & Trade supportStrategic Resource Allocation - Philips Vs Competition*Customer services staffN.B.: *Average of all competitors rated by the respondentsOrder & deliveryPricing policy & InvoicingSales representatives
    • 116. Critical Competitive Parity - Sales Reps - Performance Gap Analysis ATTRIBUTESaaBase: Those who rated the respective brands.#Caution - small baseOsramOHMSSunKhyber N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval. cAbility to handle enquiries straightawayAvailability & accessibilityProduct and Biz knowledgeAttitude(n=66) (n=10) (n=8#) (n=7#) (n=7#)c
    • 117. Pakistan - Executive SummaryIn Pakistan, Philips has maintained a fairly good level of customer equity, with an overall eQ Index of 77. However, Philips’ overall performance is just on a par with Osram and Sun. It should strive for ways to stand out from the competition and establish its leading position in the lighting product market. Overall, Direct Project customers appear to be more satisfied with Philips’ current performance than Consumer Trade, Professional Trade and Indirect Project customers. The performance of Philips on all factors is considered to be good or mediocre, except the weak performance on ‘Business & Trade support’. ‘Products’ is an obvious competitive edge for Philips in both Lamps and Luminaires categories. Hence, it is important for Philips to maintain this since ‘Products’ is important to the customers.
    • 118. ‘Order & Delivery’ is another competitive strength for Philips. However, improvement efforts on the following areas can help to further widen its performance gap with competitors: ‘Stock availability’ ‘Time between order & delivery’ ‘Punctuality’ Improvement on ‘Sales representatives’ will be effective in enhancing customer loyalty since it is another key concern of the customers, and Philips is weaker than Osram, Sun and Khyber. Top priority should be given to improve the ‘Attitude’ and ‘Product & Biz knowledge’. ‘Ability to handle enquiries straightaway’ should also be improved. The secondary areas for improvement for Philips are: ‘Value for money’ - need to further enhance the communication of the product benefits with Trade customers, in order to differentiate from Osram and Sun. ‘Handling of complaints’ and ‘returns/defectives’ by customer service staffs Most attributes on ‘Business and Trade support’ Pakistan - Executive Summary
    • 119. Singapore
    • 120. Sample Profile – by Customer TypeBase: All respondents
    • 121. Base: Those who rated the respective brands. # Caution - Small base (n=29) (n=11) (n=11) (n=7#) (n=6#)Overall eQ™ Index (Q4 2002)eQ Norm for Singapore: 78
    • 122. Commitment / Vulnerable Shares (Q4 2002)Vulnerable sharePhilips (n=29) Osram (n=11) Changi Light (n=11) Thorn (n=7#) GE (n=6#)Commitment shareBase: Those who rated the respective brands. # Caution - Small base
    • 123. Overall eQ™ Index of Philips - by Customer Type (Q4 2002)Direct CustomersIndirect Customers(n=6#)(n=13)(n=10)(n=29)(n=23)#Caution - small baseDirect CustomersBase: All respondents
    • 124. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 125. Overall Impact & Performance (Q4 2002)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCEKey area for improvement
    • 126. Lamps customers’ evaluation of Philips has dropped on ‘Products’, ‘Pricing & invoicing’ and ‘Order & delivery’. PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.cHigherLowerIMPORTANCEBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts
    • 127. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProductsBiz & Trade supportStrategic Resource Allocation - Philips Vs Competition*Customer services staffN.B.: *Average of all competitors rated by the respondentsOrder & deliveryPricing policy & InvoicingSales representatives
    • 128. (n=23) N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval. (n=6#)(n=11)a#Caution - small baseATTRIBUTESBase: Those who deal with the respective brands on Order & Delivery.Stock availabilityPunctualityAccuracy of deliveryTime between order & deliveryEase of orderingAbility to meet short term notice order requestAbility to meet project schedulesaaCondition of goods on arrivalOsramChangiThornGE(n=6#)(n=4#)Critical Area for Improvement - Order & Delivery - Performance Gap Analysis
    • 129. (n=29)Secondary Area for Improvement - Sales Reps - Performance Gap Analysis (n=11)(n=11)ATTRIBUTESaaAbility to handle enquiries straightawayAvailability & accessibilityProduct and Biz knowledgeAttitudeBase: Those who rated the respective brands.#Caution - small baseOsramChangi(n=6#)(n=7#)ThornGE N.B.: a, b, c, d or e denote statistically significant difference at 90% confidence interval. d
    • 130. (n=29)(n=11)(n=11)ATTRIBUTESaaBase: Those who rated the respective brands.#Caution - small baseOsramChangi(n=6#)(n=7#)ThornGEHandling of complaintsAttitudeHandling of returns/defectivesAccessibilitySecondary Area for Improvement - Customer Service Staff - Performance Gap Analysis
    • 131. In Singapore, Philips has achieved an eQ Index of 74, which is quite satisfactory. Its overall performance is just on a par with Osram, Changi Light, Thorn and GE in this wave. Philips is performing quite well on ‘Customer service staff’ and ‘Sales representatives’ but weak on ‘Business & Trade support’. Its performance on the other factors is just average. It should strive for ways to stand out from the competition and establish its leading position in the lighting product market. Trade customers should require special attention from Philips as they are slightly less satisfied than Direct Project, OEMs and Indirect Project customers. ‘Order & Delivery’ is of critical need for improvement since Philips is weaker than all the key competitors. To catch up with the competition, immediate improvement actions on the following areas are required: ‘Stock availability’ ‘Time between order & delivery’ ‘Ability to meet project schedules’Singapore - Executive Summary
    • 132. ‘Ability to meet short notice order request’ ‘Ease of ordering’ ‘Sales Representatives’ and ‘Customer service staff’ are the secondary areas for improvement where Philips is considered weaker than most of the key brands. Improvement programs should concentrate on Trade customers. ‘Pricing & Invoicing’ is the top consideration of the customers in Singapore. Philips should try to further widen its performance gap with the competition by further improvement on ‘Coherent pricing policy’ and ‘Value for money’. Though ‘Products’ is the competitive strength of Philips on an overall basis, there is still room for improvement on customers’ perception on its Lamps and LE products. Philips should leverage on its strength on product quality and establish an image of longer-than-average product life time, in order to support its proposition of ‘good value for money’ It is also important to further extend the product range to suit the needs of customers.Singapore - Executive Summary
    • 133. Thailand
    • 134. Sample Profile – by Customer Type N.B.: * - Census was conducted in Thailand. The sales contribution of the total customer list provided is less than 100% because 12 Trade Retail customers were removed from the customer database from September 2002 under the new distribution policy. Apart from the companies interviewed in the main survey, there were 3 companies interviewed in the pilot survey.
    • 135. Base: Those who rated the respective brands.Overall eQ™ Index (Q1 2003)#Caution - small base(n=37)(n=13)(n=8#)(n=7#)eQ Norm for Thailand: 74
    • 136. Commitment / Vulnerable Shares (Q1 2003)Vulnerable shareCommitment shareBase: Those who rated the respective brands.Philips (n=37) Sylvania (n=13) Osram (n=8#) L&E (Luso) (n=7#) #Caution - small base
    • 137. eQ™ Index of Philips - by Customer Type (Q1 2003)#Caution - small baseBase: All respondentsDirect CustomersIndirect Customers(n=7#)(n=6#)(n=11)(n=37)(n=30)(n=5#)(n=8#)Modern Retail needs more attention as it is the 2nd most important customer segment.
    • 138. Overall eQ™ Index of Philips - Lamps Customers (Trend Data)Base: Those customers who purchase Lamps products from Philips.
    • 139. Overall Impact & Performance (Q1 2003)PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProducts IMPORTANCEKey areas for improvement
    • 140. Lamps Customers’ evaluation on Philips has improved on Sales Reps and Customer Services Staff while that of the more important factors has deteriorated. PERFORMANCE (Weighted Top-2-box %)FACTORSBase: Those who rated the respective brands.ccBiz. & Trade supportOrder & DeliveryCustomer service staffSales RepsPricing & InvoicingProductsHigherLowerIMPORTANCE
    • 141. Critical Need of ImprovementCritical Competitive ParityCompetitive StrengthsSecondary Need of ImprovementMaintenanceMaintenanceIMPORTANCEHIGHWEIGHTED PERFORMANCEBetterEqualWorseLOWProductsStrategic Resource Allocation - Philips Vs Competition*N.B.: *Average of all competitors rated by the respondentsBiz & Trade supportOrder & DeliveryPricing & InvoicingCustomer services staff Sales representatives
    • 142. aATTRIBUTESaaBase: Those who rated the respective brands.Trade margin Ad. & promotional support Keeping you informed of ad. & sponsor deals Incentives schemes Timely technical support Biz support & training Quality of technical support Merchandising support Product support & training Credit terms Ability to provide design solutions N.B.: a, b, c or d denote statistically significant difference at 90% confidence interval. SylvaniaOsramL&E (Lus o) (n=37) (n=13) (n=8#) (n=7#)#Caution - small baseCritical Area for Improvement - Biz & Trade Support - Performance Gap Analysis BetterWorse
    • 143. Sylvania(n=32) (n=11) (n=8#) (n=5#)Critical Area for Improvement - Order & Delivery - Performance Gap Analysis ATTRIBUTESBase: Those who deal with Philips on Order & Delivery.Condition of Goods on arrivalStock AvailabilityPunctualityAccuracy of DeliveryTime Between Order & DeliveryEase of OrderingAbility to meet short term notice order requestAbility to meet project schedulesOsramL&E#Caution - small base N.B.: a, b, c or d denote statistically significant difference at 90% confidence interval. aaaaaaBetterWorse
    • 144. ATTRIBUTESaaBase: Those who rated the respective brands N.B.: a, b, c or d denote statistically significant difference at 90% confidence interval. SylvaniaOsramL&E (Lus o) (n=37) (n=13) (n=8#) (n=7#)# Caution - Small baseProduct & Biz knowledge Ability to handle enquiries straightaway Availability & accessibility AttitudeCritical Area for Improvement - Sales Reps - Performance Gap Analysis BetterWorse
    • 145. ATTRIBUTESaaBase: Those who rated the respective brands.Accessibility Handling of complaints Handling of returns / defectives AttitudeSylvaniaOsramL&E (Lus o) (n=37) (n=13) (n=8#) (n=7#)Critical Area for Improvement - Customer Service Staff - Performance Gap Analysis
    • 146. Thailand - Executive SummaryThe overall customer equity of Philips in Thailand (71) is slightly below the country norm (74) and that of Sylvania (75) and Osram (75). The overall loyalty level of Lamps customers with Philips maintains at similar level of the previous survey in Quarter 4 of 2000. Philips faces keen challenge from the other lighting product brands in Thailand: Overall eQ Indices of the key brands in Thailand are very similar. Philips has a higher vulnerable share than the competition, which indicates that more customers are likely to switch to its competitors. Philips should strive for ways to differentiate from the competition. Philips has a stronger relationship with Trade Retail customers which contribute the highest proportion of sales. Modern Retail customers needs special attention since their relationship with Philips is the most vulnerable. Besides, they are the second most important customer segment in Thailand in in terms of sales contribution.
    • 147. Thailand - Executive Summary‘Products’ and ‘Pricing & Invoicing’ are the most important factors for Philips’ customers in Thailand. They are also the competitive strengths of Philips which should be leveraged on. However, Philips is weaker than nearly all key competitors on all other factors. ‘Business & Trade support’, ‘Order & Delivery’ and ‘Sales representatives’ are identified to be the critical areas of improvement. ‘Business & Trade support’: should benchmark its performance against that of Sylvania in all dimensions except ‘Ability to provide design solutions’. ‘Order & delivery’: improvement efforts should concentrate on: ‘Stock availability’ ‘Punctuality’ ‘Time between order & delivery’ Ability to meet project schedules’ for Luminaires Project customers ‘Sales representatives’: all aspects require improvement.
    • 148. Philippines - Direct Customers
    • 149. Sample Profile – by Customer TypeN.B.: * - There are five VCOs in the selected regions. For Cocolight and JECO, we actually interviewed two branches for each. Hence, the total number of interviews conducted for VCO is actually 7. **- The sales representation of the final sample is not available since the sales figures of each individual customer were not provided by Philips.
    • 150. Overall eQ™ Index of Philips - by Customer Type (Q2 2003)Base: All Direct Customers(n=1)(n=7)(n=5)(n=16)Caution - small base(n=3)eQ Norm for the PhilippinesOEM is the least satisfied segment with Philips’ performance and thus require special attention in the improvement plan.
    • 151. Overall Philips’ Performance – by Customer Type (Q2 2003)Base: All Direct CustomersCaution - small baseOEM and Modern Retail gave lower rating to Philips than VCO and Trade Professional customers on all factors.
    • 152. Critical Area for Improvement - Order & Delivery – Philips’ Performance by Customer TypeBase: All Direct CustomersCaution - small base
    • 153. Philippines (Direct Customers) - Executive SummaryPhilips has received satisfactory evaluation from its Direct customers in the Philippines on an overall basis, with an overall eQ™ Index of 70. Trade Professional customers are very positive about the performance of Philips. However, Philips needs to pay attention to OEMs and Modern Retail customers, because: they are less satisfied with Philips than VCOs and Trade Professional customers on all factors; they also purchase lighting products from the competitors of Philips. Hence, Philips should strive for ways to improve its services to these two customer segments in order to further enhance their loyalty to Philips.
    • 154. Philippines (Direct Customers) - Executive Summary‘Order & delivery’ is the critical area for improvement for Philips. It is the top concern for the Direct customers but Philips’ performance is weak(47% weighted top-2-box) and below the benchmark score of 65% weighted top-2-box. Top priorities should be given to ‘Stock availability’, ‘Time between order & delivery’ and ‘Ease of ordering’ in the improvement plan. Secondary areas for improvement should be ‘Business & Trade support’, ‘Customer service staff’ and ‘Sales representatives’ for OEMs and Modern Retail customers. Besides, Philips also needs to improve the OEMs’ perception on the coherence of its pricing policy and the ‘Value for money’ of its products. No immediate improvement actions are required on ‘Products’.
    • 155. Customer eQ Study for 2nd Tier Customers in the Philippines
    • 156. Sample Profile - by Customer Type
    • 157. Overall eQ™ Index of VCOsBase: All 2nd Tier Customers#Caution - small base (n=88) (n=30) (n=27) (n=15) (n=10) (n=6#)
    • 158. Overall Performance - ACE Foods vs. Distributors of CompetitorsVulnerable share ACE Foods (n=10) Dist.of GE (n=7#) Dist.of Osram (n=3#) Commitment share#Caution - small baseeQ IndexBase: Those 2nd Tier Customers who consider ACE Foods as their key supplier of Philips products.The other VCOs are either stronger than or on a par with the distributors of GE and Osram.
    • 159. PERFORMANCE (Weighted Top-2-box %)FACTORSccBiz. & Trade supportOrder & DeliveryCustomer Service StaffSales RepsPricing & InvoicingProductsHigherLowerIMPORTANCEOverall Performance of VCOsBase: All 2nd Tier Customers
    • 160. Dist.of GEATTRIBUTESDist.of OsramBetterWorseCondition of Goods on arrivalStock AvailabilityPunctualityAccuracy of DeliveryTime Between Order & DeliveryEase of OrderingAbility to meet short term notice order requestBase: Those 2nd Tier Customers who consider ACE Foods as their key supplier of Philips products.(n=10)(n=7#)#Caution - small base(n=3#)ACE Foods - Critical Area for Improvement - Order & Delivery - Gap Analysis
    • 161. Philippines (2nd Tier Customers) - Executive SummaryAll the five VCOs have very strong relationship with the 2nd Tier customers of Philips, with high eQ™ Index of over 80. Allied and Cocolight are the top performers, followed by Rexman. JECO and ACE Foods are slightly falling behind. On an overall level, Allied, Cocolight, Rexman and JECO are either stronger than or on a par with the distributors of GE and Osram. ACE Foods has the highest vulnerable share (12%). This is related to the weaker performance on ‘Pricing & Invoicing’, ‘Customer service staff’ and ‘Business & Trade support’ than the distributors of Osram. For the 2nd Tier customers, the ‘Products’ and ‘Pricing & Invoicing’ offered by the VCOs are very well received. No immediate improvement actions are required for VCOs on these two factors, except that ACE Foods needs to improve its ‘Pricing & Invoicing’.
    • 162. Philippines (2nd Tier Customers) - Executive Summary‘Order & Delivery’ should be the key area for improvement for all VCOs. It is critical for them to improve their ‘Stock availability’ (except Rexman) and shorten their ‘Time between order & delivery’ to their customers. For Allied, ‘Order & delivery’ is the only factor requiring further improvement, on which Allied is weaker than the distributors of GE. It can maintain its current performance on the other factors, as it is performing very well and stronger than the competition on those areas. For Cocolight, JECO, ACE Foods and Rexman, apart from ‘Order & delivery’, additional improvement efforts are required on the other factors where they are still weaker than the distributors of GE and/or Osram. The four tables on the next slides summarise the key areas for improvement and recommended actions for each VCO.
    • 163. Philippines (2nd Tier Customers) - Executive SummaryN.B.: Performance level: 81 or above (top-2-box %): Very good; 71-80: Good; 51-70: Mediocre; 41-50: Weak; 40 or below: Very weak.
    • 164. Philippines (2nd Tier Customers) - Executive SummaryN.B.: Performance level: 81 or above (top-2-box %): Very good; 71-80: Good; 51-70: Mediocre; 41-50: Weak; 40 or below: Very weak.
    • 165. Philippines (2nd Tier Customers) - Executive SummaryN.B.: Performance level: 81 or above (top-2-box %): Very good; 71-80: Good; 51-70: Mediocre; 41-50: Weak; 40 or below: Very weak.
    • 166. Philippines (2nd Tier Customers) - Executive SummaryN.B.: Performance level: 81 or above (top-2-box %): Very good; 71-80: Good; 51-70: Mediocre; 41-50: Weak; 40 or below: Very weak.
    • 167. Appendices - Sample profile by location - Impact of the integration of Philips Lighting business units - Weightage given to price vs. performance - Price index of lighting product brands
    • 168. Sample Profile - Location Base: All respondents
    • 169. Sample Profile - Location (Cont’)Base: All respondents
    • 170. Weightage Given to Price & Performance when Selecting Lighting Suppliers(n=45) (n=50) (n=67) (n=42) (n=102) (n=66) (n=16) (n=29) (n=37)Base: All respondents (Direct customers only for the Philippines)
    • 171. Price Index of Lighting Product BrandsBase: All respondents (Direct customers only for the Philippines)
    • 172. Awareness of the Integration of Philips Lighting Business Units(n=45) (n=50) (n=67) (n=42) (n=102) (n=66) (n=16) (n=29) (n=37)Base: All respondents (Direct customers only for the Philippines)
    • 173. Impact of the Integration of Philips Lighting Business UnitsPerceived Impact (Has this change had any impact on your business relationship with Philips?)Base: Those aware of the integrationPotential Impact (Do you think this change will have any impact on your business relationship with Philips in the future?)Base: those not aware of the integration and those haven’t seen any impact of the change yet%%
    • 174. (本页无文本内容)