Interviews

HAIER AIMS FOR DOUBLE-DIGIT GROWTH TRAJECTORY IN 2023, EXPECTED TO LAUNCH NEW PRODUCTS IN AIR CONDITIONER AND REFRIGERATOR CATEGORIES

CXOToday has engaged in an exclusive interview with Mr. Satish NS, President, Haier Appliances India

 

  1. What is the current market scenario for the consumer durable industry?

India has become one of the fastest growing ACE markets in the world and is also emerging as a tremendous manufacturing hub through the introduction of PLI (Productivity-Linked Incentives) schemes.

Presently, the industry is witnessing a premiumization trend across the market, having higher sales from the premium and mid premium segment. Many consumers are opting to upgrade their home electronics and appliances. The industry is expected to continue its growth in the coming years, driven by technological advancements and innovation. Moreover, consumers are shifting their focus from visiting showrooms and learning about the products to online research. As many as 50 per cent of the consumers do their research online and then purchase the products. People are looking for energy-efficient and feature-rich products wherein they won’t mind paying extra to buy better quality products. This trend has led to an increase in consumer finance and credit card offer schemes wherein consumers consider the option of buying the products on EMI.

 

2. What are growth trends expected in the consumer durable industry? What are the key consumer insights that the company is seeing?

The industry had crossed the pre-pandemic mark in value terms in FY22, demand driven by both urban and rural segments, though rural demand has come into play in the second half of the financial year. Air conditioners (AC) segment has been the key growth driver for the industry. Demand for ACs and Refrigerators are being driven by changing weather patterns. Additionally, demand for television has been driven by shorter replacement cycles, and preference for larger screens packed with latest features. Technological advancement, high competition and consequent significant reduction in prices have also aided demand in this segment.

There is also a shift in buying behaviour wherein most of the customers are not buying online, as more offline stores continue to offer evolved buying experiences. Brands are now offering experiential brand outlets for customers to have a physical interface with products, especially while making high-end purchases. This trend is here to last, as offline shopping for customers continues to be a means of spending time outside the home with themselves or their families. Furthermore, while traditional home appliances have remained popular, products such as smart air conditioners, refrigerators, televisions and robot vacuum cleaners are gaining popularity among customers as new enablers.

 

3. Throw some light on the demand from tier II and tier III markets in India and expectation from 2023?

In the new emerging India, the expansion of Tier II and Tier III cities, supported by the ongoing tech revolution, is fueling the country’s economic growth and driving socioeconomic transformation on a global scale. Our consumer insights show that tier II and III cities have twice the demand for branded consumer durables and electronic items as tier I cities, especially during the festive season.

The growth opportunities in tier II & tier III cities, have remained an untapped asset of the country for long. Furthermore, changing consumer behavior as a result of increased internet penetration has created new opportunities for us wherein these cities are expected to provide a significant boost this year.

 

4. How is inflation going to impact the consumer durable industry? How different is the Indian market in comparison to the rest of the world, especially the Asian markets?

Amidst the rising inflation strategic actions are required to strengthen the manufacturing in India, it will be critical to maintain the country’s current path of steady economic growth. We see disruption occurring, which is why we are attempting to pre-empt certain production. The supply chain will be disrupted, but we will be able to salvage it. However, if this trend continues, there will be a shortage in the coming quarter. It could have an impact on sales in the April-June quarter. While consumers will hold on to discretionary spending due to inflation, certain home appliances will remain in demand with the seasonal change.

 

5. How is Haier supporting India to become a leading manufacturing hub and what are its expectations from the PLI scheme?

The primary goal of the PLI schemes is to make India self-reliant in terms of domestic manufacturing to create international standard manufacturing hubs, reducing import bills, increase export capacity, and creating jobs opportunities in the country.

Over the years, Haier has stayed true to its commitment to continuously offer India-centric innovative products that deliver the promise of quality to the customer. Apart from Haier’s manufacturing plant in Pune, we have established our manufacturing unit in Greater Noida to further the intent of ‘Made in India’ and ‘Made for India’ initiative. The Greater Noida facility is one of the state-of-the-art R&D centers focusing on innovating to address local needs of the consumers. Every Haier product stem from its brand philosophy of ‘Inspired Living’, whether it’s the Bottom Mounted Refrigerators which was designed keeping in mind the dietary and food storage habits of India consumers, India’s first side-by-side refrigerator to cater the food storage needs of consumers, a range of washing machines that operate in nearly Zero Water Pressure or Haier’s PuriCool AC range equipped with Self Clean technology.

Haier has topped Global Major Appliances Brand Rankings recognized by Euromonitor International for 14th consecutive year. Additionally, we have also been felicitated with ‘The Most Energy Efficient Appliance’ award by the Bureau of Energy Efficiency (BEE) – Ministry of Power, Government of India at National Energy Conservation Awards (NECA) – 2022.

 

6. What has been Haier’s philosophy for innovation in products and design?

At Haier, customer-inspired innovation has been a key driver for brand growth. We believe that when a brand begins to think about its customers and their needs, it automatically works in the benefit of company’s development.

Haier draws its inspiration from the customer and combines it with three decades of technological and industrial know-how to deliver tailored innovations: products that are smart, convenient and stylish. We are consistently working towards our goal to introduce products and solutions that cater to the pain points of consumers in everyday life, thereby also fulfilling our commitment of Inspired Living by drawing inspiration from our customers. As a leading consumer appliance brand, we recognize this as our core philosophy, which is why we are successful in creating and developing products that are the highest standards of quality and durability.

 

7. Are there any new launches planned for this year? If yes, can you share details?

Haier’s commitment to developing innovative products for Indian consumers has remained central to the company’s operations, and the brand has evolved to meet consumer demands for inspired living. Lately, Haier has increased its emphasis on producing premium products in India through local manufacturing. In the upcoming summer season, Haier will release a new line of air conditioners and refrigerators, with an aim to achieve a double-digit growth trajectory for the categories in 2023. We will also be announcing new products across our Television and Washing Machine categories as we move forward.

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