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Rediff.com  » Business » Better products, but no discounts this Diwali

Better products, but no discounts this Diwali

October 08, 2007 14:43 IST
With the time between Navratri and Diwali representing the highest-selling period for the Rs 25,000 crore (Rs 250 billion) consumer durable industry in India, the 'no discount' strategy adopted by manufacturers comes as a surprise.

This year, leading companies such as Samsung, LG, Haier and Whirlpool are launching a slew of products to push sales during the festive season, minus the discounts.

In the previous years, the focus during the season was to create excitement around promotions, discounts and the free gifts. This year, the industry seems to be counting on shifting the focus to the new products being launched in the market, with a view to provide more value-added options for the consumer.

According to analysts, consumer sentiment is becoming increasingly quality and performance-oriented and discounts and free gifts no longer ensure sales.

"With more options to choose from, the consumer will still get a little extra in terms of value addition if not in terms of freebies. Hence, sales will not be affected," said Suresh Khanna, secretary, Consumer Electronics and Appliances Manufacturers Association.

"This year we shall not be offering any freebies, rather we will focus on customer experience, technology and after sales service. For a marketer, delivery on these parameters therefore gains greater importance than enticing consumers with short-term benefits such as gifts. This will be the road to creating more loyal consumers in the long-term," said V Ramachandran, director sales and marketing, LG Electroncics India. LG is launching a range of CRT TVs, home theatre systems and microwaves.

P Tognatta, director, Samsung India, said, "Our special offering for the festival period this year comprises of an exciting, new array of innovative audio video and home appliance products and assured gifts across all our products. 'Har Ghar Mein Khushi, Har Ghar Mein Samsung' is our festival campaign, and it represents our company's efforts to give our customers greater satisfaction and happiness." Samsung has already introduced its Easy View' flat colour televisions and Quatro Cooling Refrigerator.

However, in keeping with the festival spirit, Samsung is giving away an assured gift with every product purchased during the promotion period. The assured gifts would range from glass and dinner sets to Tata Sky set top boxes.

Gunjan Srivastava, director - consumer electronics division, Philips, said, "Philips is expecting to clock 40 per cent growth during the festival season this year mainly in high-end products such as home theatres, LCD televisions along with new segments such as portable Mp3 players (Philips GoGear range)."

Philips is also investing in advertising and retail merchandising such as product leaflets, banners, posters to lure consumers at the point of purchase.

Whirlpool will be launching consumer relevant programs aimed at bringing the brand closer to the consumer. Some of them may be on lines of their recent Onam program - 'Yellathillum Magic' where Whirlpool tied up with more than 2,500 outlets across Kerala to bring benefits to the consumer on all festive purchases.

"Whirlpool has always believed in consumer centric initiatives which actually add value to the consumer during festivals and also builds the proposition of the Whirlpool brand which is to add magic to the homemaker's life," says Sukhpreet Singh, general manager, brand marketing, Whirlpool

The Index of Industrial Production  statistics for July 2007, which showed a de-growth of 3.2 per cent in durables manufacturing, has not altered the marketing strategy for the companies as they do not see the numbers as a downturn.

"I think the market has shown good buoyancy in the first half of the year and the festival season will give a further fillip to this sentiment," R Zutshi, deputy MD ,Samsung India said.

MISSING FREEBIES

Leading companies such as Samsung, LG, Haier and Whirlpool are launching a slew of products to push sales during the festive season, minus the discounts

In previous years, the focus during the season was to create excitement around promotions, discounts and the free gifts

According to analysts, consumer sentiment is becoming increasingly quality and performance-oriented and discounts and free gifts no longer ensure sales

BS Reporter in Mumbai