Companies

Godrej Appliances to enter new categories for rural consumers

Purvita Chatterjee Mumbai | Updated on May 08, 2013 Published on May 08, 2013

Chill biz: The ‘Chootukool,’ a low-cost cooling appliance, fromGodrej.

To make specific products for bottom-of-pyramid consumers



Growing rural demand is making Godrej Appliances target consumers at the bottom of the pyramid with new products pegged below Rs 3,000.

Products in categories such as water purification and washing solutions at lower prices are being explored nearly three years after it launched the ‘Chootukool’ refrigerators at Rs 3,000.

George Menezes, Chief Operating Officer, Godrej Appliances, said: “We are testing the waters in terms of a new business model for the bottom of the pyramid in categories like water purification and washing solutions, which can work with and without electricity.”

In water purification too, the company is planning storage-based purifiers, which do not require running water and electricity.

“We already have ‘Chootukool’ as a product brand but, going forward, there could a new brand to cater to the bottom of the pyramid consumer,” added Menezes.

Incidentally, Chootukool has been running a pilot launch in such States as Tamil Nadu, Gujarat and Maharastra for the past three years and there are plans to scale up its distribution across the country.

“Almost 70 per cent of India is made up of rural markets, and we intend scaling up distribution as we want to add new products,” says Menezes.

Godrej Appliances has already segmented the market with Eon at the premium-end, followed by the Godrej brand at the mass end. New distribution channels, such as e-commerce are being explored aggressively by the company for the past two years.

“Today, sales through e-commerce comprise ten per cent of our turnover. We expect e-commerce to generate sales worth Rs 200 crore in the next two years,” added Menezes.

After lacklustre AC sales last summer, the company is looking forward to better days. “Last year has been a difficult year for the industry, but summer has now picked up in the past two weeks in north and central India.

Since 70 per cent of AC sales happen in the first half of the year, this will lead to a delayed summer for AC sales,” said Menezes.

The company is also innovating with categories such as microwave ovens that double as pizza-makers and 7-star-rated power-saving AC s.

“Last year may have been a exceptionally bad year, but this year we expect to grow at a CAGR of 25 per cent on the back of the new range of differentiated products,” added Menezes.

Godrej Appliance is the largest division of the Rs 5,000-crore Godrej & Boyce.

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Published on May 08, 2013
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