Companies

Consumer durables sector sees ‘silver lining’ in pent-up demand

Meenakshi Verma Ambwani New Delhi | Updated on May 06, 2020

Pandemic-led hygiene concerns, WFH-induced call for convenience seen to boost home appliance sales

As Lockdown 3.0 began with some relaxation in norms, one of the first things Bengaluru-based food writer and blogger Monika Manchanda did was to buy a new microwave from the nearest LG outlet. “Pleased to inform, new microwave has arrived,” she tweeted on Tuesday. “And oh child is baking a mango coconut cake to test it.”

Consumers like Manchanda will perhaps bring some cheer in the coming days to home appliance players and retailers who are banking on pent-up demand to lift sales that have been hit hard by pandemic-led disruptions.

With the Ministry of Home Affairs (MHA) allowing standalone shops in urban regions and all shops in rural regions, barring those in malls, to reopen, some consumer durable retailers are gradually opening stores in select regions in line with the norms set by the respective State governments. At the same time, e-commerce channels have begun taking bookings for non-essential items in green and orange zones.

Summer sales

“We have enough inventory available with our distributors and at the factory to meet consumer demand,” said Manish Sharma, President and CEO, Panasonic India.

“Looking at some very early signs in India, consumers are going to shops that are opening up to make purchases, but largely for necessary items. With the onset of summer, we anticipate a pent-up demand for consumer appliances, especially ACs and refrigerators.

“Also, we believe smart products that will help consumers multi-task or convenience products that help them work-from-home (WFH) efficiently such as vacuum cleaners and washing machines, are expected to see traction in the coming days.”

Leading consumer durable firms such as LG Electronics India and Samsung India have also swung into action, taking pre-bookings on their websites with EMI and cashback offers. These pre-booked products will be delivered by their offline retailers in line with the relaxations given by the respective local authorities.

Industry watchers believe this move will help offline retailers bring down their inventories apart from nudging consumers to begin buying, even as they grapple with the new normal.

Bigger, smarter

“In the past one month, we have received thousands of queries from consumers across the country as to how they could buy our TV or digital appliances, as they felt the need to equip their homes with the latest technology while they stayed home and worked from home,” said Raju Pullan, Senior Vice-President, Consumer Electronics Business, Samsung India.

“Many, including those in tier 2 and 3 cities as well as rural areas, are wanting to buy bigger Samsung Smart TVs, 5-in-1 smart convertible refrigerators and hygiene steam washing machines from Samsung, as their needs are changing.”

Companies are also gearing up to meet the evolving needs of consumers for whom convenience and hygiene have now taken centre-stage.

Vijay Babu, Vice-President, Home Appliances, LG Electronics India, concurred that health and hygiene have become key factors in selling. The company has a range of white goods loaded with features, such as steam wash in washing machines and hygiene caring system in refrigerators, which will cater to consumers’ evolving needs, he said.

“As consumers are increasingly doing household chores themselves, we expect them to upgrade to bigger capacity washing machines, refrigerators and, in fact, dishwashers, which have very low penetration (at present),” he added.

“A few shops, post government directives, have opened and we can see good traction. E-commerce is allowed to deliver in orange and green zones, and certainly this will play an important role,” Babu added.

Published on May 06, 2020

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