The Hindu Business Line : Bathroom design matters

The demand for sanitary ware is on the increase with the market seeking new designs and product range. The industry is growing steadily and branded players are gearing up to meet customers’ aspirations. In the last few years, companies have released more products than they have done in the earlier decades, says Mr V. Krishnamurthy, Head Marketing, Building Product Division, Hindustan Sanitaryware & Industries Ltd.

Hindware, Somany Group company, is a market leader, is widening its product range and offerings in various segments aggressively. With a significant share in most of the market segments, the company is targeting the consumer for growth.

Excerpts from a chat with Business Line:

What is the trend in the sanitary ware segment? Has the slowdown in the real-estate market had an impact?

The company is growing at about 16 per cent against the industry growth of about 13 per cent.

Pricing is not under pressure, at least as far as retail sales is concerned, but there is some pressure in bulk sales — bulk buyers have access to a larger choice of brands and products in the market. They are expecting major discounts. Bulk sales, for us, account for about 25 per cent of our business and we are continuing to grow in sales.

How is it that this line does not reflect the trend in the construction industry?

Because we cater to the projects that have been announced two-three years ago and those projects are continuing. The demand is bound to continue down the line and we do not see any major drop or shift in trends at least till 2010. Our forecast is that the growth will continue.

Also, our focus on retail sales is a strength.

There is no drop in people making their own choices and doing up or refurbishing the bathrooms. In refurbishing, India is still an emerging market — this accounts for about 10-15 per cent of sales. But judging from trends abroad this is a big segment and there is bound to be a big boom in sales here. Customers are beginning to upgrade their bathrooms in about five-seven years.

Which of the segments — mass market, midline or premium — is the growth area?

We have a varied offering of standardised products ranging from the mass market segment to the high end premium, including niche products that are imported. The mass market segment is met by the Raasi brand and then up the chain the basic Hindware, and Hindware Art and Italian collection. Keramag — the international niche brand which is imported — is from Sanitec of Finland, a $1.5-billion group and a world leader from whom we import the range to offer the premium products in India.

The strongest segment is the luxury and the premium line, which is growing at about 25 per cent and accounts for about a fourth of our sales.

But this is also because the starting base is low in the market for this range and so the growth is more. The premium segment is just taking off with more offerings from international brands in the market.

Customers are demanding more and the aspiration levels are increasing. The other segments are established with large volumes — the numbers are bigger but relative growth small. Hindware is focusing on the middle and upper segment.

How is focus in marketing shifting with customer demand?

We maintain a closer contact with the end buyer. Bathroom design is a key factor in people selecting an apartment. As a brand we are offering a wide choice in various segments. In the last five years, we have launched more products than in the previous 35 years.

One series of products is launched every three months, this will make a lot of difference. Hindware is going at it at a faster pace than its competitors. Also, we are building a lot of activity around the brand.

For the first time in the industry there is a consumer scheme on offer pan-India. Such schemes were among the biggest catalysts for growth in the white goods industry.

For example, when customers buy a water closet set for about Rs 4,500 they get an assured gift for about Rs 3,500. Gifts include cash back, cutlery sets, travel package and a lucky draw in which you could win a sedan. This ensures value to consumers and preference for the brand.

What are your plans to strengthen retailing?

We have a 1,000-strong network of distributors with a retail network of over 10,000 and growing.

Our market penetration is increasing with our basic products being introduced into smaller towns with a population of at least 20,000.

Our brands enjoy a significant market share — 33 per cent in the case of Raasi and about 40 per cent in the Hindware range.

Responses to blproperty@thehindu.co.in

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