The Hindu Business Line : `India provides interesting opportunity'

Hans Straberg, President & CEO, AB Electrolux, and Peter Birch, CEO, Electrolux Major Appliances, Asia Pacific, on Electrolux's partnership with Videocon and the retail boom in India.

READY for the big spin ...

Why did you partner with Videocon? How has the association been so far?

Straberg: Well, in our business of consumer electronics and consumer durables, trust is an extremely important thing. People trust global international brands, since they have the expertise of global innovations. That is a reason why we acquire and partner with local players in different countries. Also, Videocon is one of the most trusted consumer durable brands in India, and there would have been no one better to partner with. We cover very different areas — Videocon is a mass brand whereas Electrolux is positioned as a premium brand. This extent and width of coverage provides a scale that's extremely helpful to grow Electrolux the brand even quicker. Moreover, with Videocon as our partner, we do not have to worry about things like a service and logistics network, which are absolutely essential for consumer satisfaction. In fact, even with manufacturing, it becomes even easier, with Videocon gaining the licence to even manufacture for us. So all we have to do is concentrate on building the brand.

So how do you plan to build the Electrolux brand in India? Also, with Korean companies like LG and Samsung are gaining ground fast with cheap prices and effective campaigns ...

Birch: Well, we believe that advertising and promotions are extremely important. And we do spend a lot of money in promoting our brands in India and the Asian region. As it's summer here and it is the season for sales of refrigerators and air-conditioners, we are going to heavily advertise and promote our product offerings in these segments. Also, products like washing machines and microwaves do not have any specific season, so we advertise and promote those product segments throughout the year.

We don't mean to be anything other than absolute experts in the home appliances segment here, and we are spending pretty good money for that. We have plans of using the traditional media such as television and print. We are also going to leverage from more interesting touch points through below-the-line activities that are very unconventional, as by their very nature, consumer durables are something that consumers are very close to and use several times during the day. In fact, worldwide, we have extremely good relations with professional chefs, who believe a lot in our kitchen appliances. Moreover, we do several shop-in-shop cooking demonstrations for our consumers at retail outlets.

There's a whole retail boom happening in the country. How do you plan to leverage that to build your brand in India?

Birch: Actually, the entire retail situation in India provides us with an extremely interesting opportunity for us. In fact, it's a win-win situation for all, the companies, the retail chains and above all, the consumers. However, we will give equal importance to the traditional local retail chains as well, as till date a major part of our revenues comes from these local chains. In spite of that, we will tie up with all the upcoming modern retail chains, as these retail outlets give lots of visibility and space to the brands.

What about introducing new categories into the Indian market from the Electrolux stable?

Birch: Well, we believe that India is a key market and there has been an incredible change in the economy and consumption habits in the country. As a result we do see a lot of scope for categories such as dishwashers that we are extremely strong in the international markets. In fact, we have plans to introduce a lot of our other products into the Indian market that are as yet not present here.

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