BenQ Develops Retail Channel Plan For CE, IT
By Greg Tarr -- TWICE, 1/26/2004
LAS VEGAS — BenQ used CES to show dealers its efforts to expand market share in both the IT and A/V entertainment sectors with an official entry into the retail distribution channel.
In that effort, the company first announced an expanded lineup of high-definition home theater products including LCD-TVs in the 26W-, 30W- and 46W-inch screen sizes. Then, the company announced it hired just prior to CES Mark Donnelly, former Samsung Digital Information Technology Division sales VP, as its new sales VP.
In an interview with TWICE, K.Y. Lee, BenQ Corp. global CEO, said that two years into the launch of the BenQ brand in the U.S. market, he expects 100 percent sales growth in 2004 as the company plots its course in retail distribution.
Previously, the company had sold primarily IT goods through online distribution and through two-step distribution partners, which will continue to help BenQ in its retail goals.
Now BenQ is also bringing on sales reps and will begin some direct sales, as it embraces more traditional CE retail channels.
Donnelly said BenQ has its sights set on becoming a major resource for home- theater displays — both in micro-display-based video projectors and in an extensive line of flat-panel LCD TVs. The company will protect its dealers from low-price-focused dealers by instituting a firm MAP program, that includes pricing guidelines in order to qualify for support and co-op ad program funding.
Ralph Tang, BenQ America president, acknowledged that the company's current sales performance in LCD TVs is small — a result he attributes to only entering the market for a short time, products with small-screen sizes, and a lack of awareness to the BenQ name as an LCD TV resource.
All three areas are being corrected, he said.
"Because we are also an LCD panel supplier, we foresee that approaching the end of the second quarter, the price for our 26W-inch LCD TV going down to the $1,499 range. Then we expect to see a heavy volume of sales from the retail channel," Tang said. "In LCD TV we will have three very important strengths over many of our competitors — contrast ratio, brightness and the video processing quality."
BenQ's new flagship DV4680 46W-inch fully integrated LCD TV offers built-in ATSC tuner, 1,920 by 1,080 progressive resolution, 16:9 aspect ratio, 800:1 contrast ratio and 600 nits of brightness. It will ship in August at a $7996 suggested retail.
The 30W-inch DV3080 ($4,995, March) and 26W-inch DV2680 ($2,995, February) both have widescreen aspect ratios, 1280 by 768 pixel resolution, 600:1 contrast ratios and 600 nits of brightness.
All come equipped with built-in speakers with SRS WOW Dynamic Surround Sound technology, and also feature de-interlacing, 3D Y/C Comb and 3D Edge Filtering systems, the company said.
Included are DVI-HDCP, composite, component, S-Video and D-Sub inputs.
Donnelly said that because BenQ is "a vertically integrated" supplier, it will be better positioned than most newcomers to supply both small independents and big national accounts like Wal-Mart or Best Buy.
Lee said that because BenQ builds its own LCD panels, it should be better positioned to drive prices lower than most competitors. BenQ's LCD panel company is the third largest in the world, Lee said.
"Those companies that do not have vertical integration of LCD panel production, long-term will find it difficult to compete. That is why Sony had to invest into Samsung's LCD panel manufacturing facility."
Lee has set an immediate goal of moving LCD TV pricing to roughly $100 per inch, and envisions one day getting as low as $50 per inch.
Despite its advantages, Lee said BenQ will "not be a low-price leader. With our manufacturing capabilities and our system and panel technologies we will be able to offer better performing products at a better value to our channel partners," Lee said. "We can also assure our long-term survival. With so many brands getting into the market now, after five years we don't expect to see many more than 10 brands remaining. We will be one of them."
Donnelly said BenQ will follow closely the marketing strategy of his former company, which built a market leading position in LCD PC monitors after just three years in the category.
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