Panasonic India is seeking to up the ante on online sales of its mobile phones (under the Eluga brand) even as it targets ₹2,000 crore worth of handset sales this fiscal. According to Pankaj Rana, Business Head, Mobility Division Panasonic India, almost 25 per cent (one-fourth) of the targeted turnover is expected from online channels.

In an interview to BusinessLine , Rana talks about the company’s FY-18 plans, increasing market share, eyeing export markets and ‘Arbo’ (artificial intelligence embedded virtual assistance) as the new USP for its smartphones. Edited excerpts:

How was FY-17 for Panasonic mobiles?

After November, the industry went for a jolt. But, apart from that last fiscal was good. We could establish the brand in the distribution channels. And, we penetrated beyond Tier-I and Tier–II towns last year. Out of our total sales, distribution contribution was 90 per cent, and online was 10 per cent or less than that. In FY-17, we sold around 2 million smartphones and did a turnover of ₹1,340 crore.

What is this year’s target?

In FY-18, we intend to clock a turnover of ₹2,000 crore with sales of 3 million smartphones. We will also be launching close to 18-20 devices compared to last year’s 17-odd.

Any plans to shore up online handset sales?

Compared to the industry where 30-35 per cent mobile sales are online, ours is much less. The plan for this fiscal is to take it to 20-25 per cent (online sales). Buying patterns are changing and a huge chunk is there online. The online customer is generally the youth — our target audience. We have to connect with them to build the brand equity.

Has a separate online only portfolio been planned?

In March, we launched handsets with the Arbo and they were exclusive to Flipkart. This was the first time we showed our aggression and intent in the online space. So, yes there will be online-only models.

Compared to last fiscal when we had just two products online, this year at least six to seven will be online only.

Panasonic as a brand has great equity offline with all of its other products having a strong presence through the distribution channels. We do not want to jeopardise that. However, in the online space, we’ll not be a commodity product and offer something different like Arbo.

Run us through your plans of introducing Arbo as a differentiated offering in mobiles.

Discussions are on regarding how Arbo will be placed in Panasonic smartphones (whether to have it across price points or concentrate on a specific one). Our plans around Arbo involve having phased launches and to keep evolving it through continuous development and feature enhancements. We feel, Arbo has the potential for which there will be good demand and curiosity around Panasonic’s smartphones.

Any particular sweet spot you are targeting with mobiles?

In the distribution space, we are targeting a price bracket between ₹6,000 and ₹12,000 while for online it will be ₹8,000-15,000. In the coming days, you’ll also find other mid-to-high offerings in ₹15,000 and upwards.

And the target market share?

Our market share is around 2–2.5 per cent and within this year we want to take it up to around 4 per cent.

How easy or difficult would it be for you to compete with Chinese players dominating the Indian market?

The one good thing that has happened with the new Chinese players having a presence here is they have revived the distribution and retail channel sales. They have also improved price positioning in the market. This is in a way helping brands like Panasonic.

Are you looking to export to new markets from India?

At this point smartphones are being exported from both India and Hong Kong. We sell in Nepal, Sri Lanka, Saudi Arabia, Egypt and South Africa.

We started our overseas operations last year and hence we will still need some six-odd months to stabilise operations there. After that we will look at other countries. In terms of new markets, we want to expand our business into the various geographies of Africa and it includes the likes of Ghana, Kenya, Zambia, Nigeria, among others.

In terms of contribution, overseas sales accounted for 12-15 per cent of the turnover last fiscal.

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