Barco Projection Systems

A Case Study by
Guy Minton Jasveen Samra Mukund Narasimhan Noppawun Sopee Raiju Neelamkavil Wei Zou
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Current Position
Barco N.V. is one of the top three worldwide manufactures with a focus on expensive high quality products in a niche market. It focuses on graphic projectors, which has the maximum growth and revenue in the projector market. Barcos market share are as followed: 4% in video projectors 23% in data projectors 55% in graphic projectors Major competitors to Barco are Sony, Electrohome, and NEC The product that would compete with the Sony 1270 (BG 800) had a 40% chance of being completed by the Infocomm trade show
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Issue we are facing

Sonys 1270 graphic projector with lethal combination of higher performance coupled with low price compared to Barcos existing & proposed projector, threatens Barco's market share and its traditional market segmentation. Sony threatens to redefine & capture the existing data and graphics market by its high performance and low pricing products. Thus eroding upto 75% of its forecasted profits for 1990. Only less than 4 months left to promote a superior product, at Infocomm 1990, that

What are the options

Option 1 - Continue working on product development but choose cut down prices of BD400, BD600 and BD700
Profit is significantly reduced.

Option 2 Stop the plan of introducing the BD700 in October and develop an advance version of the BD700, the BG700, hoping that it will be launched on time to compete with Sonys 1270
Barco should not introduce the BD700 if it cannot out perform Sony 1270 in terms of the performance.
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What are the options ( (contd.)

Option 3 Put other developments on hold and put major effort in the BG800 until completion. If the Infocomm deadline is not met -Offer future localized trade shows to promote and take orders for the BG800 and discount prices on existing higher line until the development is complete. Option 4 - Enter emerging markets like Asia and allow market share erosion in

Plan of action
Short term plan
Option 3

Long term plan

Continue to pursue high end products for niche market and also continue to devote commitment to research and development to retain top quality products. Barco should not rely on outside source for raw materials but instead develop most of it inhouse. Establish brand extensions, instead of focusing on high-end products, creates another brand as a subsidiary that sell similar products but lower quality and lower price 6 Diversify on market segmentations and be a market

Future strategies
Barco should find more providers of tubes, not just Sony. Sony focus on low end products, verses Barcos high end objectives. Barco should pay attention to this market and concentrate on diversification and launch brand proliferation. They can make a brand to focus on volume and low price. Investigate expanding production to provide all components. Make products less complex and more user friendly. Be at least 50% ahead in terms of technology 7 advances so as to absorb these shocks from the