THE GAME CHANGERS OF THE CONSUMER DURABLES INDUSTRY
Date: Tuesday , March 04, 2014
Panasonic India is the Indian division of Panasonic Corporation (PCRFY) that develops and engineers electronic technologies and solutions for customers in residential, non-residential, mobility and personal applications. Headquartered in Osaka Prefecture, Japan, the company has a current market cap of $29.11 Billion.
The Indian consumer durable industry is growing by leaps and bounds, expanding at a CAGR of 14.8 percent to $15.5 billion in FY2015. With intense competition in this space, companies are under continuous pressure to deliver substantial, innovative and technologically advanced products in a shorter time period. The year 2014 will witness companies adopting emerging disruptive technologies like social media, mobility, cloud and data. Combination and convergence of these technologies are leading to the emergence of new products and solutions offering. With the multiplying smart devices, instant connectivity and massive growth of social media, customers today demand real time communication and consistent experience across channels. Companies are leveraging disruptive technologies to not just meet these changed expectations, but also to innovate and present cutting-edge products and solutions. Along with these advancements, being one of the fastest growing industry segments in India, other factors contributing to the development in India are local manufacturing facilities, increase in customer base from the rural areas and government support in ways like relaxation of tariffs and increased liberalization.
While the sector is set for a further upsurge encouraged by numerous opportunities, there are still some challenges that exist. With India surging ahead on its growth path, we are witnessing a fundamental shift in the consumption and buying behavior of the \'core\' Indian consuming class. The Indian consumers have grown not just in terms of numbers but also in terms of product preference and technological understanding, giving a stiffer competition to the industry. A healthy competition can yield better results and this is what the consumer durables industry is undergoing today. Despite the fact that there is a significant increase in the purchasing power, consumers are looking for \'price plus\' \'value options\' which brings together the best of price, quality, convenience, consistency, innovation and shopping experience. They are not only looking for availability of products; they also want better experience, services and ambience.
Although, the Indian consumers are evolving, it is still a challenge for a brand to communicate its value over price as majority of consumers get influenced by the pricing over quality. In order to counter the challenge, Panasonic in recent times has begun plugging the price gap without compromising on quality aspects. Panasonic has overhauled its retail strategies, unleashed new products in different categories and stepped up advertising & marketing spends, and will continue to meet the expectations of a varied class of customers. The brand has been entering new businesses and product categories and continues to launch a range of new products suited for the Indian market.
In line with this, the company has progressed rapidly by way of some innovative product offerings and by building exciting sales and marketing strategies. With an innate understanding of the Indian market, we have made brand Panasonic high on local flavor with a major youth connect and a presence across India. As a part of some initiatives led by us, Panasonic became one of the very few brands, to parallely tie up with two most influencing factors in the country - association with celebrities and partnered with sporting events. These initiatives have been instrumental in channel penetration and consumer excitement for Panasonic products.
The brand has endeavoured to be not a Japanese company operating in India, but rather an Indian company with Japanese roots. We believe that localization has been the key driver for our business growth in India. It is the pillar which helped us to wear India lens and understand the need-gap of the market to create products that truly give best-fit solutions to our consumers. For instance, the company developed and introduced first-of-its-kind India specific innovation Cube AC which was localized to the Indian customer requirements married with the best in class technology and concept.
The very successful \'Sound for India\' campaign was also flagged off which communicated the brand\'s promise of bringing products that are tailored to local needs. Lastly, we marked our entry into the Smartphone segment in India, thereby redefining the Indian Smartphone consumer experience. Following the success, today, and pursuing a localization strategy in India, Panasonic has grown from $1.3 billion in FY 2012 and is expecting a growth of $1.65 billion by FY 2013.