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Sandip Somany

Joint MD | 28 Apr 2008

The consumer mindset is evolving, they want a good quality product, with good pre-sale service as they want to understand how the product would fit and what it would do. They also want a product with minimum requirement of after sales service, but want to be sure that should they have a problem, the company is there to support and guide them.

Sandip Somany, Joint Managing Director, Hindustan Sanitaryware and Industries Ltd (HSIL) and an alumna of University of California, has been associated with the Hindware brand in India for over two decades. He began his career as a trainee in the company and then moved on to hold several key positions, including Vice-President (Technical), and President of Ceramic and Glass Division, which he counts as the most enriching experience of his life so far.

In 1990, Somany became the President of Ceramic and Glass Division and then took over as the Joint MD of the company in 1994. With a view to acquiring greater market share as well as to makes its presence felt in the Southern market, he acquired sick company Krishna Ceramics Ltd, a sanitaaryware unit at Bibinagar. He also spearheaded the company in crossing important milestones with the implementation of sanitaryware division’s expansion plans, repositioning of the Hindware brand, modernisation of casting processes by installing capillary and battery casting machines.

HSIL has recently forayed into the organised retail sector with its brand EVOK, a home interior retail brand. In conversation with exchange4media’s Abhijeet Mukherjee, Somany talks about his future plans, company growth strategies and customer expectations from EVOK.

Q. What prompted you to diversify into the home interiors retail business?

We had been looking at opportunities for growth in one of the areas that has been growing significantly over the years, and that is organised retail. So, we looked at various opportunities and found that there is lot of scope to grow in this business. Secondly, there are very little few players in the kind of model that we have, which is specialised interior home products. That’s how we started drawing up a plan to get into this new business. To some extent, the business is also known to us because in the bath and the kitchen side we already have domain knowledge as we are India’s largest company in the ceramic side. We already know what the sector is all about, so this is like a forward integration for us.

Q. What would be the promotional activities for EVOK, the new retail brand that you are starting?

Promotion would be regional, however, every store would have a launch activity. Then we would have selective advertising in media, originally in regional space as the stores would be regional. Once we get a larger footprint, we would go for a national promotion campaign. We would use mainly newspapers, interior and consumer interest magazines, outdoor and FM radio, but not television because we cannot justify the price as we don’t have a pan-India presence yet. We are investing Rs 250 crore over the next five years for the EVOK retail business, of which, 7 per cent would be initially used for the promotional activities, which would later be reduced to 5 per cent.

Q. With so many competing sanitaryware companies, what strategies have you planned to keep yourself ahead of others?

There is competition from every corner of the world, now that all major companies are coming to India, but the strength of our company is its brand and its distribution network. Our brand is the most well recognised brand according to an international study done by ACNielson in India and the point is very simple – we expect our brand to continue to drive our growth, besides the product introductions that we have already done and are planning to do.

Q. What is the growth rate of the sanitaryware industry in India? What is HSIL’s growth rate and market share?

The sanitaryware industry is growing about 15 per cent per year. HSIL is growing at between 20 per cent and 25 per cent per annum. Our current market share is 40 per cent.

Q. From where do you plan to start your home interior retail business? Which are the cities you are targeting in the initial phase?

Initially, we would launch in the North, and the first place would be the NCR region where we might have 3-4 stores. The first store would come up at Faridabad, the second store would be at Gurgaon. Then there would be a store either in Delhi or Ghaziabad. We would then roll out in other Northern regions like Jaipur, Lucknow, Chandigarh, and Jalandhar.

Q. What can a consumer expect when they visit an EVOK store?

They can expect many things – it would be a large format store, there would be a vast variety and range of products along with a wide array of services such as design services, which are not given by any other company. Products that please the customer and at prices that they can afford, because our target segment is very clear, we are not going for the lowest in consumer segment, nor are we aiming for the premium segment. We are targeting the middle class and higher middle class segments.

Q. Where do you plan to foray next?

We are looking at acquisitions, but I cannot divulge more in this regard as nothing concrete has materialised yet.

Q. How has the consumer mindset been as far as sanitaryware is concerned?

The consumer mindset is evolving, they want a good quality product, with good pre-sale service as they want to understand how the product would fit and what it would do. They also want a product with minimum requirement of after sales service, but want to be sure that should they have a problem, the company is there to support and guide them.

Q. Will your home retail business also help consumers learn and understand how to get what they want?

Absolutely. We have a team of specialist in the home retail business to advise customers on the technical aspects and the installation aspects. Every store has interior designers and decorators who help consumers zero in on what they want and translate that into a drawing or a picture for the consumers to see. While many consumers can describe what they want, they cannot visualise it. We would do that for them. We have a team of installers who install the products at the consumers’ homes. In fact, it is the service that we would offer that would differentiate us from our competitors.

Q. How has the consumer mindset changed over the years?

Compared to what it was before, the mindset has changed completely. The consumers’ expectations and aspirations have changed over the years. Consumers want better looking products with more features and functions. I think today, the consumer is quite clued into what he wants. They are looking at value-additions in terms of style, colours, eco-friendly products. Our products help save up to 28,000 ltr of water per annum per bathroom. This is a very significant value addition, give the water problems faced in some metros.

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