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Durable Defiance

Slowdown or not, the Indian consumer durables industry seems set to defy the laws of gravity by posting robust growth.

On a high

The first flush of quarterly results gave a hint of it. The CII Ascon report confirmed it. The Indian consumer durables industry is on a roll, with most segments displaying a buoyancy that has taken even optimistists bsy surprise.

This is great news, given that last year was nightmare of tragic proportions (after ten years of over-20 per cent growth).

Has 2002 put all that behind? Looks like it. Take CTVs, India’s foremost durable category. Figures so far indicate a growth of some 40 per cent (over equivalent periods in 2001) in this market, buoyed by the summer’s soccer mania. And also, perhaps, some cheeky marketing by aggressive players such as LG, which has made a marvellous play of refining the consumer’s notion of what really is precious (remember the ‘wall’ of footballers covering their eyes instead of their, er, you-know-whats?). “We had a target of 1 million TVs this year, and have already sold more than half of that – though usually most sales are made in the second half of the year," says Pradeep Tognatta, VP, Sales and Marketing, LG.

Refrigerators and ACs have done well, too. For this, thank the soaring mercury scale, and the dead-on-arrival monsoon (at least in urban India for now; the negative fallout overall will be felt later, say analysts). For refrigerators, especially, it has been a revival, given that the market had been declining in the past two years on account of the recession.

Latest quarter results show that fridge sales are up 10 per cent. Apart from the regular brands, Godrej has been a strong player this year, with its new Preity Zinta ‘Life jum jaye’ advertising thrust. Well, it has apparently jelled so well that the brand is back in the reckoning with a bang. "We have grown by strengthening the functional and emotional value proposition of our products, and also by improvement in general sentiment of the market," says Soumitra K Ghatak, executive vice-president, Marketing and Sales, Godrej Appliances.

As for ACs, the market has grown 22 per cent, compared to 15 per cent last year. A contributing factor has been a bitter price war, with branded players slashing prices to strike within a more affordable price range. Carrier made a comeback, but leadership usurper LG only strengthened its health theme with the ‘clean-air-for-pregnant-wife’ campaign, which took the brand beyond its rivals’ reach. LG has stretched its 2002 sales target upwards. It is now eyeing a total of 200,000 units, up from the initially targeted 130,000. In July, by when the monsoon normally hit North India, LG sold 12,000 units - up from usual 4,500 in this month.

Washing machines? It has not joined its livelier counterparts in all the fun. This category has been sliding for the past two years, and the revival this year has not been very encouraging. Perhaps marketers need to make a better effort, with Whirlpool responding to the gentle-wash fabric-preservation pitch being made by new-entrant Kenstar.

The good news is that smaller consumer electronic items seem to be picking up. Audio systems are doing well, reportedly. Philips’ revolutionary wind-up radio has become the subject of some attention in rural India.

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