sense and simplicity
Philips Consumer Electronics
Philips Medical Systems
Philips Domestic Appliances and Personal
Founded Eindhoven, 15 May 1891
Founder Gerard Philips
Headquarters Amsterdam, Netherlands
Area served Worldwide
Key people Jeroen van der Veer(Chairman)
Frans van Houten (CEO)
Products Home appliances
Revenue €21.39 billion (2014)
Operating income €486 million (2014)
Profit €415 million (2014)
Total assets €30.97 billion (2014)
Total equity €10.86 billion (2014)
Number of employees 116,000 (2014)
Slogan "Innovation & You"
(1910 to 1950s)
Philips Metal Filament Lamp Factory Ltd. was
founded in Eindhoven in 1907.
That was followed in 1912 by the foundation of
Philips Lightbulb Factories Ltd.
In 1920s,Philips started to diversify its product
In the 1920s, the company started to
manufacture other products, such as vacuum
In 1939 they introduced their electric razor, the
In 1949, the company began selling television
1990 TO 2015
In may 1990 when company
posted losses of $2.6 billion,top
management launched a major
initiative known as”Operation
In 1999,Philips embarked on a
worldwide marketing campaign
and changed their company’s
image to a technology-oriented
company rather than a market –
In 2001,Philips launched a
company wide restructuring
program called “Towards One
Philips’(TOP) under CEO
Gerard Kleisterlee to foster
The program helped not only in
lowering costs but also promoted a
spirit of collaboration.
In January 2011 Philips agreed
to acquire the assets of Preethi,
a leading India-based kitchen
In March 2012 Philips
announced its intention to sell,
or demerge its television
to TPV Technology.
April 2013, Philips announced a
collaboration with Paradox
Engineering for the realization
and implementation of a “pilot
project” on network-connected
solutions. This project was
endorsed by the San Francisco
TARGET APPLICATIONS IN THE PROFESSIONAL
MARKET ARE DECORATIVE OUTDOOR AND
• Globally,Philips derives 34 percent of its revenues from lighting ,in
India,the figure is 58 per cent.
• In Health care,the global contribution is 40 per cent.In India it is 18 per cent
• In Consumer lifestyle,the company gets 26 per cent of its overall
revenues,in India,it is 24 per cent.
• Totally the Indian unit closed the fiscal ended march 2012 with revenues of
Rs 5,579 crore,growing at a clip of about 23 per cent per annum.
GROWTH OVER THE YEARS
1891 1912 1920 1939 1949 1963 1982 2000 2011 2015
Philips embarked an improvement
program called BEST (Business
Excellent through Speed and
Have several tools and approaches as a
part of BEST.
Some of them are:
• Philips Business Excellence Model
• Process Survey Tools(PST)
• Balanced Scorecard (BSC).
Philips was successful since its
inception, but its faced poor financial
performance during the 1990s due to
• Fall of market share.
• High Manufacturing Costs.
• Lack of competitive product price
• Growing competition and Rapid
changes in the external environment
OEM & OES
Supports hospitals and
providers for experience
Home respiratory care
Market leader in male
Personal care product is
introduce in Tier 1 &
Wet & Dry electric shaver
Hair dryer & straightner
HEALTH CARE & PERSONAL CARE SOLUTIONS
Q.1 Evaluate Philips "sense and simplicity" strategy. What are the
risks the company faces in using the tagline?
Philips sense and simplicity
strategy was based around a
marketing insight they
obtained from a market
research on their consumer
segment. Philips wanted to
make the technology hassle
free and easy to access.
1) They would compromise on the
advancement in technology in
order to make things simpler.
2) They would give the impression
of a less advanced electronics
manufacturer, because of it's
simple design and features.
Q2. What strategies can Philips follow to ward off competition from
Japanese manufactures of consumers electronics?
The major advantage that
have over Philips
is their ability to keep their
if Philips were to emphasize
quality, simplicity of design, the
manuals, and the sense that
their products provide more value
for money, they would have an
advantage. The ‘Sense
and Simplicity’ campaign is all well
and good, but Philips should take
care to ensure that
advertisements are designed in
such a way as to ensure that
customers understand the
products in exactly what the
company wants them to.