The Hindu Business Line : Summer's onset heats up market for white goods

WITH summer round the corner, consumer electronics majors in the refrigerator, air-conditioning and cooler markets are warming up to a slew of new product launches and active marketing campaigns to grab a slice of the growing market for these white goods.

The market sentiment is bullish, especially as the healthy economy has increased the purchasing power of the middle-class and upper middle-class.

The expanding market is prompting the consumer electronics companies to focus on different market segments by launching new products at varying price points. And with brand consciousness increasing in the marketplace, the companies have earmarked substantial budgets for brand campaigns both in the electronic and print media. The accent of the campaigns appears to be on health, which, in other words, means improvement in the quality of cooling from the standpoint of health.

For example, LG Electronics India Pvt Ltd will focus on the commercial air-conditioning segment this summer. For this, the company will launch about 20 new models in this segment, with capacities ranging from 1.5 tonnes to 10 tonnes, in April this year.

"The new products will incorporate our plasma technology, which is basically a unique air-purifying technology that can generate high voltage to eliminate microscopic contaminants like dust particles, pollen, pet fur and even bacteria and viruses," Mr Alok Divatia, the company's National Head (Commercial Air-conditioning), told Business Line.

The company has spent Rs 7 crore on R&D for the new products, which will be marketed as new brand entities. "We plan to launch our campaigns shortly. The campaigns will seek to highlight the incorporation of our plasma technology in the new products with accent on health," according to Mr Divatia.

LGEIL selected this segment as its focus this summer because of the high growth in the commercial air-conditioning market. "This segment is growing at 30 per cent. We achieved a turnover of Rs 40 crore from this division in 2003 and now, with our focus on this segment, we have targeted a turnover of Rs 200 crore in 2004 with our new launches, which would mean a market share of 45 per cent," Mr Divatia points out.

Blue Star has opted to focus on manufacture of chillers that are used in massive central air-conditioning systems. The company has been importing chillers, but has now decided to tie up with Hanbell Precise Machinery Co of Taiwan for supply of compressors so that it could assemble the product here under its brand name. "We will be using our design and manufacturing capabilities to leverage on the Hanbell hermetic screw compressors. We have been marketing about 200 chillers a year, but with this tie-up we will be producing 400 chillers," says Mr Satish Jamdar, Executive Director of Blue Star Ltd.

In the refrigerator segment, Electrolux Kelvinator Ltd, the Indian subsidiary of Electrolux Group, has launched two new models in its Oxy-range category, which are equipped with Magicoat RB freezer that ensures quick ice-making and easy retrieval of ice trays. "With the launch of these two new products, which are priced at Rs 8,690 and Rs 8,290, we now offer a wide range of direct cool refrigerators. These products will be part of Electrolux's life-nourishing appliances with features like Health Guard and Ice-Lock," says Mr Jayant Kaushal, the company's General Manager (Marketing).

Indeed, as the heat waves start rolling out, the market for these white goods will hot up, as their manufacturers will be sweating it out to grab as much market share as they can. And one of the biggest beneficiaries will be the TV and print media, which are betting on some big business from the consumer electronic companies.

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