Consumer durable players hopeful of a ‘happy Diwali’
This Diwali, consumers are purchasing high-end products and companies are betting on innovation and new product launches to cater to the changing consumer needs on account of the pandemic
While the pandemic-induced lockdown hit businesses across categories severely, there were some sectors that saw an uptick in sales during the period--automobile and consumer durable being two of them. While the automobile category got a push because of an increased preference for personal mobility due to safety concerns, the stay-at-home compulsion led to an increase in demand for consumer durables. The increased need for home appliances combined with the fact that festive season is considered an auspicious time for purchasing new household items and, renovating, shifting into or buying new houses, the months ahead also look promising for the consumer durable category. We take a look at how the sector is gearing up for the festive season.
Parag Kulkarni, Managing Director, A. O. Smith India, believes that the Dussehra–Diwali period is the period of joy & positivity and would lift the overall sentiment significantly. “We are already witnessing this in our categories (water purifiers and water heaters). This sentiment is widespread and not restricted to metros alone, but is more visible in Tier II & Tier III cities,” he says.
Banking on the positive consumer sentiment, Satish NS, Senior Vice President, Marketing & Sales, Haier India, shares that with consumers spending more time at home, they are upgrading home appliances such as TV, washing machine and microwave. “Given the change in consumption patterns of our consumers in the post-Covid times, their willingness to buy high-end products has increased due to the fact that they are not spending much on travelling, eating out, and other such activities that involve expenditure from their savings. Henceforth, we can say that the consumers are open to premium category products and are relying on appliances that will make their life easier.”
“In view of this trend and our attractive festive offers and easy financing schemes, we’re optimistic of a good festive season sale ahead, and the revival of the consumer durables industry at large,” says Satish NS.
The pandemic has led to a change in every facet of life, whether work from home becoming the norm, online being the mode of learning for students or video calls being the new way to ‘meet’ friends and family. Even gaming has witnessed a surge as a recreational activity. All this has given a fillip to the PC category.
For Acer, PC becoming an essential device has given an impetus to their demand. Says Sooraj Balakrishnan, Head-Marketing, Acer India, “The preliminary phase saw a lot of demand being served where discretionary spending was reduced. We are seeing good sales across our channels. The conversions are much higher as we see more in-market audiences coming to the store. People are inclined to purchase higher-end and premium laptops as they prefer more powerful thinner laptops. The gaming laptop also witnessed good momentum even with the lockdown. We are hopeful our consumer PC business will continue to stay strong.”
Innovation and launches to the fore
At A. O. Smith India, the communication strategy focused on the health benefits of the brand. Kulkarni says, “We believe that consumers need to be communicated the benefits better as well as value propositions need to be built within our offerings. Once that’s done, it’s natural for the consumers and the trade to respond positively towards the brand. We have been consistent with the communication to emphasize the health and hygiene messaging for the water heater and purifier categories.”
He adds, “We’ve launched new products in both the water heater and water purifier categories. We believe that innovation and new products are needed to address the underlying need of safety & immunity.”
Similarly, with high consumer demand, Satish NS is confident of high double-digit growth. He says, “This festive season, the consumer spending has revived manifolds in comparison to the past months, and at Haier India, we’re expecting an overall growth of more than 35%. In addition, we have witnessed a 50% surge specifically in the premium sector. Categories such as side-by-side and bottom-mounted refrigerators, top load and front load fully automatic washing machines and Google android smart televisions touched record high demand in September-October and we expect this upward trend to continue until Diwali.”
Sharing ad spend estimates, he says Haier India’s spends this Diwali season is similar or a little higher than last year and the brand believes that being aggressive will help capture the consumer attention and market share.
Talking about marketing during the festival season, Balakrishnan, says Acer is constantly looking at options with an eye on how the market is evolving. “We will be strategically looking at all the options available with a keen eye on new-age mediums. In the short-term, digital will drive more spends, but as the situation improves, we will expand our mediums after observing consumer trends and shopping behaviours. Consumers are also looking at a trusted voice to cut through clutter and with Sonu Sood coming on board as our brand ambassador, we feel this is a great way to reflect what our brand stands for – breaking barriers between people and technology and playing an integral role in the new digital-first India.”
Significant shift to digital
A.O. Smith India’s brand promotions and launches have focused on an increased intensity on digital communication. Kulkarni says, “We have been advertising in both digital and print to optimise our reach to our TG. From a channel perspective, there is a high impetus on digital platforms and e-commerce due to a surge in online purchases during the pandemic. With our readiness to address the rising demand from this channel, we have a strong foundation to be aligned with the current situation. We are one of the most active brands in our categories on e-commerce. We will continue to focus our efforts on trade, modern retail and key accounts that constitute the base of our business and are expecting good growth from these channels as well.”
He adds, “With the radical change in media consumption, this festive season offers opportunities for us as marketers to connect with consumers like never before. As a consumer brand, we are focusing on solutions that are relevant for the new normal, such as re-looking at the media-mix to build the right ROI and focusing on truly incremental marketing outcomes. Mediums like digital and streaming platforms etc will be key, but like any brand, we will move where the audience is. Also, many media houses are consolidating their offerings instead of individual mediums, and this is the way marketers should also look at.”
On his part Satish NS says, “Compared to last year, the shift to digital is quite substantial this time. In the southern markets, we have invested in TV in combination with Print. Nationally, we are using Print and have tied up with major publications across the country as we see a big opportunity in Print. In terms of spends, Print has the larger share followed by TV and Digital.
(With Inputs from Ritika Raj)
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