For large spends, consumers still prefer brick & mortar stores

E-commerce players are finding it tough to sell larger home appliances, as buyers still prefer to touch and feel before buying them. Online sales for such products tend to hover in the range of 1-5 per cent. Shantanu Dasgupta, VP (Corporate Affairs & Strategy), Whirlpool India, said, “E-commerce sales currently contribute less than 5 per cent for the home appliance industry.”

Rajeev Jain, Sales Head (Home Appliances), LG India, said the key reason is that consumers still want to touch and feel home appliance products the final purchase. In fact, some players say that some of the models of home appliance products, sold on e-commerce sites tend to be ones which are not the most popular models sold in brick and mortar sales.

Another home grown player Godrej Appliances does not expect festival sales to go beyond 1.5 per cent of its usual sales through e-commerce sites.

“Logistics is an issue for e-commerce sites as it is difficult to transport big appliances like ACs and refrigerators. Besides there is no difference as our products are sold at market operated prices both through offline and online stores.,” says Kamal Nandi, Executive Vice President (Marketing & Sales), Godrej Appliances. In the case of big appliances, it is not the companies who give discounts but the sites themselves who pass on the benefits of margins they get vis-à-vis the brick and mortar retailers which give to consumers as discounts. “We do not give our products at a discount but it is popular e-commerce sites who sell it at cost price since they save on the margins made by the brick & mortar stores,” explained CM Singh, Chief Operating Officer, Videocon Industries.

Eric Braganza, President of Haier Appliances (India) added, “We do not directly give our products to e-commerce players. They take it from other dealers and third-parties, then discount these products by 8-10 per cent. It remains to be seen how sustainable this strategy is going to be.”

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