Call it dahi in the north, or thayir in the south, if there is one food item that unites all of India, it has to be curd. Be it soft or thick, what matters is getting the consistency right every time. That, of course, is not easily achieved. It is this challenge of preparing curd day-after-day with the right consistency that South Korea's Samsung has addressed with its Curd Maestro refrigerator.
Launched in January, it has been designed keeping in mind consumer insights.
Not surprisingly, Curd Maestro - that prepares fresh curd in six-seven hours - has emerged as an instant hit in Indian households. After all, curd is not just an essential food item, but is considered auspicious - curd with sugar - to have before important events.
"Our Make for India innovation, Curd Maestro refrigerator that we launched at the beginning of this year, has seen very strong pan-India demand. It was launched after extensive consumer research. In a research we did before the launch, we found that there was strong preference among 25-40 year olds across cities for a refrigerator that makes curd and that is what played out for demand when the refrigerator was launched. Curd Maestro addresses this insight by enabling people to make 'healthy and hygienic' curd at home," says Raju Pullan, Senior Vice President, Consumer Electronics Business, Samsung India.
Samsung is among a number of companies leveraging technology to gather deep insights on consumer needs and launch feature-rich products. Home-grown e-commerce company Flipkart has designed an in-house, algorithm-based tool that analyses thousands of reviews customers leave on the platform daily. This Review Analyser tool pulls out major pain points and desires articulated by customers, which Flipkart uses to identify a potential space in the market where one of the private brands will fit.
hen we developed this tool in 2017, the first thing we noticed was that this treasure trove of customer feedback had one big message - some products and features that customers were looking for simply didn't exist in India," says Jeyandran Venugopal, Chief Product and Technology Officer, Flipkart.
Flipkart has been engaging and sharing customer feedback with brand partners.
The same insights led Nokia and Motorola to enter the Smart TV space last year, with products designed keeping the diverse consumer requirements in mind. The Nokia branded Smart TVs come with superior audio quality powered by JBL's sound programme, as Flipkart's consumer insights had found that poor sound quality and experience is a major concern for customers while purchasing televisions.
Apprehending consumer demand for designing new products is one of the many verticals where brands are deploying technology. According to IBEF, India's `76,400-crore consumer durable industry (2019) is expected to double by 2030 on the back of rising disposable incomes and easy credit access. The Covid-19 outbreak and the nationwide lockdown has temporarily dampened growth. While the lockdown starting March impacted close to 30 per cent of the industry's annual sales, brands have been quick to adopt technologies, helping them revive lost sales.
"Digital and emerging technology adoption have helped solve various use cases related to revenue upliftment and EBITDA improvement for consumer durable companies. Most companies have used digital to streamline secondary sales operations in the form of order booking, inventory visibility and stock fulfillment by using mobile platform enabled Distributor Management System (DMS) solutions, and have increased their salesforce productivity through proper route planning and optimisation powered with the underlying AI-based analytical platform," says Feroz Khan, Partner & Leader, Digital and Emerging Technologies, KPMG in India.
Building Brand Loyalty
Just designing a right product won't suffice today. Companies are exploring innovative strategies to reach out to prospective customers using digital technology. The mix comprises video-assisted demos, facilitating purchase from home with quick and safe delivery, and addressing after-sales requests virtually.
While augmented reality and virtual reality product demos have existed for a while, it is video-assisted demos that are becoming popular among buyers. Godrej has made arrangements to help consumers buy appliances through video-assisted remote selling initiatives. Here, customers are being provided with the option of scheduled live demo through a video call with the brand's store-based advisors, where queries are answered. This is followed by flexible payment options as per the customer's preference. This initiative is already seeing signs of acceptance as the company has been able to sell successfully to consumers across branches and stores.
Similarly, after-sales service, which is often considered a pain point, has been overhauled almost overnight. Due to the lockdown, when brands could not schedule engineer visits, they came up with do-it-yourself videos, assisting customers to carry out basic services in case of air conditioners, and basic self-checks and repairs for damaged or non-working products. This is followed by video-consultation for examining faults and initiating repairs in the best possible way. UK-based Dyson has, for example, been helping customers identify what went wrong with the vacuum cleaner and is shipping spare parts to the customer that he can plug with guidance over a call. "Although priced on the higher side, Dyson's service team helped in fixing my vacuum cleaner. Rather than just selling the product, it is the complete experience, including service, that counts," says Bombay-based Geetu Gambhir, who swears by Dyson products. VU Televisions, too, adopted a similar approach. Owing to the logistics constrains during lockdown, VU was quick to replace TVs that could not be repaired at home. Industry experts believe the trust instilled in the customer during times like these goes a long way in building a loyal customer base.
The advent of e-commerce in India has opened a new vertical for optimising sales of consumer durables. While it took some time to build trust, e-commerce soon became a preferred mode of shopping in metros and Tier-II cities. Although brands have been thinking of omnichannel solutions, there has been a distinct divide between offline and online. However, the outbreak of the pandemic and the nationwide lockdown have got brands to think out-of-the-box and upgrade their offline retailers online. Brands have been taking initiatives for quick product discovery solutions at the nearest local store and even facilitating purchases using technology.
As consumer behaviour changes across India, it has become even more crucial to opt for digital transformation. Brands intend to make it a win-win situation for trade partners and consumers. "Trade partners are a company's key interface with the customer and help them get business online also. Over and above having a strong digital presence via websites, e-stores and in e-commerce, we are exploring new-age digital means to connect with consumers and have recently undertaken some concrete steps towards the same," says Kamal Nandi, Business Head and Executive Vice President, Godrej Appliances.
Godrej, apart from assisting trade partners to come aboard on Google My Business, is enabling each of its 25,000 offline retailers build a digital presence by creating a Facebook Business Page by June-end. "Of this, 2,500 are already on board and counting. This will help consumers access product information and purchase a Godrej appliance from local retailers. This allows them to link up with consumers through WhatsApp also to discuss, negotiate and conclude the sale," says Nandi.
Others, including Samsung, Panasonic and Xiaomi, too, are bringing offline retailers online. Some industry leaders have partnered with Benow, the digital payments platform, to facilitate offline retailers to sell consumer electronics products online. The endeavour is to get the entire ecosystem transformed digitally. Without any upfront investment, it will allow local retailers to create their online catalogue and share it with prospective customers, who can select products and place orders using the online link. Payments can be made online.
"We are training retail partners to on-board and help them understand the new platform for seamless transaction. We expect this will make the sales process easier and faster for not only customers but also retailers. We plan to extend this to all distribution partners such as multi-brand outlets, national and regional retail outlets and sub-dealers, in the coming months," says, Jialal Koundal, Group Head, Trade Marketing, Panasonic India.
Some brands are registering their exclusive stores and outlets on e-commerce platforms such as Amazon to leverage the digital wave. "Even consumer companies have started a new segment of the business model by using the digital channel through e-commerce platform with brand.com and marketplace penetration. They are now able to bring their traditional retail and online retail at the same level by using omnichannel technology platform which helps them enhance sales and profit margin," adds Khan.
The initiatives seem to be working as demand for consumer durables have picked up significantly post easing of the lockdown. Laptops, TVs, smartphones, air conditioners, washing machines, vacuum cleaners and dishwashers are in demand. There is now a waiting period of close to 15 days for vacuum cleaners and dishwashers. Industry sources state big consumer durables brands are now driving 10-30 per cent of average sales from online stores.
Social Media Influence
With research and online purchase being the new mantra, consumer durable brands have been actively using digital and social media platforms for marketing. It is less expensive compared to traditional mediums, including TV commercials, print advertisements and more. All leading brands now use digital platforms for brand building, business, after-sales support and reputation management. Xiaomi, which started as an online-only brand in India, was initially promoting everything on social media. The reduced marketing cost meant aggressive product pricing, resulting in volume sales.
"We make efforts to constantly engage with consumers through our multiple social media handles like Twitter, Facebook, LinkedIn, YouTube and Instagram. We have used digital platforms from time to time to connect with and educate users. Our Mi Fans are connected to the brand through Mi Community, the community forum built to connect with fans for regular engagement and feedback on our products, which directly or indirectly enable us to better our products and elevate our consumer experience," says Raghu Reddy, Chief Business Officer, Xiaomi India.
According to a report released by Boston Consulting Group and Google India in July last year, 28 per cent of consumer durable sales today are digitally influenced. This is estimated to reach 63 per cent of total sales, amounting to $23 billion by 2023. Around $10 billion will be online sales.
In price-sensitive India, all strategies now revolve around content consumption patterns of consumers. It varies but almost 70 per cent of digital investments are linked to ROI (return on investment). Campaigns are meant for driving business. Facebook, Instagram, YouTube, Twitter, or even TikTok apart from Google, is being opted for depending what performs best for the category.
"Unlike traditional marketing, brands can easily track sales on digital platforms. The thumb rule is to target platforms where consumers are spending maximum time. Google and Facebook are leaders in driving direct revenue," explains, Honey Singh, Co-founder, #ARM Worldwide.
Operations And Manufacturing
As of FY20, domestic manufacturing at `32,200 crore ($4.61 billion), accounted for 42 per cent of the the Indian appliance and consumer electronics (ACE) market. With the government focus on developing an electronic components manufacturing base and encouraging exports, the industry is witnessing investments. Managing large-scale manufacturing with a distributed supply chain has its own challenges, which companies are overcoming with technology.
In production, automation is coming to the rescue, since it not just improves production, but speeds up the cycle as well. At the Xiaomi factory, testing of mobile phones has been automated for certain aspects like use of multimedia for long periods. Even improvements have been made in packaging and scanning lines as well with the introduction of automation in inventory tracking.
Product development, consumer centricity and digitisation via technology are the top priorities going forward for the Voltas group. "We are capitalising on technology not only in ramping up manufacturing prowess, but also at the front end with regard to supply chain, warehouse management systems and consumer engagement," says Pradeep Bakshi, MD and CEO, Voltas Ltd.
Adoption of Industry 4.0, which integrates IT in manufacturing with real-time data on production and maintenance, is on the rise. Godrej has already implemented such solutions that have helped in quick resolution of problems. It aims to enhance manufacturing efficiency with the introduction of cobots (collaborative robots) with advanced safety features, wherein humans and robots work alongside to deliver higher productivity.
While technology adoption has been on the rise, the Covid crisis has indeed sped up the process and presented the industry with an opportunity for revaluation, innovation, and transformation.