The outbreak of COVID-19 resulting in the nationwide lockdown has not just impacted the sales of consumer durables and electronics but has forced OEMs to rethink their existing strategies. While some of the brands such as LG has come up with lucrative offers, including cashback, Super Plastronics Pvt Ltd, the Kodak brand licensee is going to redirect all efforts towards online sales.
"Since it is work from home, we are working on the strategy front. We have evaluated ourselves on our performance, where we have gone wrong, and what we have been doing right. We have learned a lot of things we have been doing in the past and the direction we have to be in. Due to lockdown, it is a complete target change for the year 2020-21, and we are working on that. However, everything will depend on when we will resume sales and when the manufacturing facilities be open," says Avneet Singh Marwah of Kodak brand licensee Super Plastronics Pvt Ltd.
For instance, Super Plastronics was going big in the offline space. In April itself, the company did two major cash and carry agreements with Walmart, and was later approached by a modern retail chain outlet. "We thought of a huge spike in modern retail stores and regular retail stores, but now we are changing a few of our strategies because the next three months will witness a lot of social distancing. There will be a lot of surge in online sales, as people will refrain from going outside. Therefore, our digital marketing and PR campaigns have now been shifted to online. We will be targeting more potential buyers where for the first time the content viewership has reached the maximum during the lockdown," avers Marwah.
Smart TVs have been gained popularity over the last couple of years and the current lockdown will only fuel it further. Easy access to various applications for streaming content scores over expensive DTH subscription. Also, at the time of purchase, consumers will compare features and specifications, and might just opt for affordable brands that perform well. "Chances are that affordable brands will perform well after the lockdown. One of the reasons is the cost cut where the GDP is as predicted to be 1.5, so people will avoid spending and if they would prefer spending, they would like to buy bigger screens at affordable pricing. When spending power will reduce then there is a chance where a customer starts shifting to an affordable brand," says Marwah. Consumers are likely to step out of their comfort zone and start researching.
The current lockdown has impacted the sales but many OEMs made up with the huge Flipkart sale that happened in March, ahead of the lockdown. "The Big Shopping Day sale's first 3 days happened to be overachieving, as we achieved our numbers on day one itself. We had to increase our pricing on day 4 and 5 so that we do not oversell", adds Marwah.
The company believes that once the lockdown gets over, there is going to be a huge spike for 10-15 days followed by a dry out period. The biggest challenge will be to understand how to fill this period gap after 10-15 days.
On the stocks front, the company has enough stocks to suffice sales for June and July as well. The only challenge is manufacturing as from day one, they will not be able to scale even 70 or 80 per cent production as only 25 per cent of the employees would be allowed in the factory.
Commenting on how badly has the COVID-19 impacted the television industry, Marwah explains, "there is a loss of close to 1.7 million units currently. Overall, the total of Rs 15,000 crores of the industry has been affected only in electronics and the government has lost about Rs 5,000 crores of the fixed revenue. That is the figure right now, but our approach is different as when the lockdown started, we discussed this internally that we have 10 and a half months to achieve what we earlier wanted to achieve in 12 months. Sales will be affected and there will be challenges in achieving the numbers but in the replacement market, the numbers will spike. There are about 8 lakh households which are without TVs right now, where they have some trouble with their TVs. So, the replacement market is about 8-9 lakh and this data is till April 22, whereas by May 1, the number will be around 10 lakh TVs," adds Marwah.