State of consumer electronics industry & the ‘go local’ sentiment
Guest Column: Avneet Singh Marwah, CEO, SPPL & Thomson TV-India writes about living in the new normal, the state of consumer electronics and more
This pandemic-like any other major global event or happening has made brands rethink and re-evolutionise strategies across every sphere. Customers are going to be buying in a certain way or mood, vendors or associates are going to function in a different way and so on. As we see time pass, areas or localities with a spike in Covid-19 cases may have to formalise rules and regulations as the situation demands.
The level and speed of pivoting that has happened with business within this time frame has been quick and something that was envisaged for a couple of years more. More customers have willingly moved to digital. Brands and retailers will finally get a better ROI on their spendings on digital as they have a larger base of audience shopping online.
However, we must not miss out the excessive revenue loss that happened amidst this lockdown, which is now relaxed to an extent. This was inarguably required and was for the welfare of the nation albeit we must point out that it was a tad bit irregularly planned. Coming back to our prior sentiment, India is now more prepared with an increased production capacity for PPEs, masks and so on - a development which gave the government some confidence to relax the regulations for lockdown 4.0.
Having said this, while the essential products categories did not take the said hit and fearlessly went on to provide their services and products as per government directives, the non-essential category on the other hand took the entire hit as sales on e-commerce platforms and offline outlets had been barred for a while. This resulted in the electronics industry’s sufferings as the industry absorbed heavy monetary losses.
Living in the new normal with caution
As we kickstart our economy, industry leaders need to be more prepared than ever to undertake all the precautionary measures to ensure employee safety. Factories and all workspaces must ensure that they abide by the revised SoPs for functioning in a socially distanced and hygienic environment.
Some steps include mandating social distancing to avoid any future infection or diseases, installing human sanitization machines, having a quarantine floor for any medical emergency, phased production with staggered shifts, frequent disinfection and sanitization, compulsory masks, protective gear, regular temperature checks, frequent sanitization, and training the employees to ensure workplace compliance. Factory owners must also ensure that the end product is sanitised well, too, for the sake of our consumers. Labourers must be trained and taught not to fear the virus but instead take all necessary precautions.
A new discipline of hygiene has to set in across all manufacturing units across sectors of sorts.
The state of consumer electronics
As discussed above, the industry has faced a loss of more than Rs 20,000 crore in revenue whereas the government has suffered a Rs 6,000 crore loss as well. In terms of unit loss, 1.3 million households in India are still without television. With theatres stadiums and all other sources of entertainment prohibited by the government the only source of entertainment remains are smartphones, tablets, laptops and televisions.
About 70% of the offline Indian market is for Smart TVs and 80% for the same, online. One of the major reasons why non-smart TV still sells is because of D2H (Direct to Home). Post the announcement of the lockdown, the TV industry has been facing a huge lag in content with no means to produce new content thus going back to replaying their old content.
This has led to a massive number of people switching to OTT platforms. There is a new form of democratisation of technology, content and entertainment now.
These OTT platforms, also newage production houses, such as Netflix and Prime are not only finding takers of their newly produced shows and movies but a new wave of people are also going back to their earlier produced, award-winning and worthy shows.
Lead starrer movies with names such as Amitabh Bachan and Nawazuddin Sidiqqui are now being premiered on OTT platforms and India welcomes this move.
Thus, demand for smart TVs is set to increase with the market for replacement of gadgets also kicking in - converting non-Smart to Smart TVs.
Undeniably, the number of first-time online buyers will also increase. Trends show that people in the age group of 35 years and above will start their shopping journeys online as physical retail spaces become a tad bit undesirable. This has already happened in many other countries so it will be a game changer for India. Those modern retail chains who have begun their online ecommerce journey, with a physical presence as well, will also see a growth in their numbers. Online retail is only 2% in India, by the end of 2025 this will grow more than 15% in India.
Vocal about Local
As soon as the government opened up red, green and orange zones for delivery, early trends show there is a spike in online sales. Additionally, we are also seeing more Made in India companies being demanded whereas those that are being imported are lagging on their sales figures. This is making international brands with products being manufactured abroad, more cautious about launching (or not) their products in India.
This is overall an encouraging sentiment as India truly has begun to go local. This will only spurt our nation’s manufacturing capabilities, employment numbers and the skillset.
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