ManagementSub-Rs-7,000 fridges the new battleground
Hungry for growth, companies such as Godrej Appliances and LG Electronics are set to debut in the sub-Rs-7,000 refrigerator range.
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The sub-Rs-7,000 range is the new price point that players have identified to get consumers into their fold, especially in Tier-II, III and IV markets, where price sensitivity is particularly high. Typically, entry-level refrigerator models are priced above Rs 7,000.
Godrej Appliances, according to the company’s vice-president (sales and marketing), Kamal Nandi, is working on refrigerator models that can be priced below Rs 7,000. “We should be ready with it soon,” he says. But the most innovative product to come out of the Godrej Appliances stable will be Chotukool, a refrigerator said to be the world’s lowest-priced at Rs 3,250. The company is reportedly looking at a March launch for the product. Weighing 7.8 kg, this refrigerator will not have a compressor and will run on battery and cooling chips.
Rival LG Electronics will also be out with a Rs-6,900 refrigerator model by then. Whirlpool India is also not ruling out the possibility of a sub-Rs-7,000 refrigerator model in the future. “We are open to it. Price points are important,” says Shantanu Dasgupta, VP, corporate affairs, Whirlpool India.
Videocon already has a presence in the segment. But, with all-India penetration of refrigerators at less than 18 per cent (according to the Consumer Electronics and Appliances Manufacturers’ Association), the potential to increase the market size is clearly there.
The manner in which the refrigerator category is expanding mirrors the pattern of growth in the market for television sets. Going from black and white to colour to liquid crystal display sets, market players steadily brought down price points with each technology leap. Today, a 15-inch colour television set, for instance, costs as low as Rs 4,000, while premium models, like the new LED television sets from companies such as Samsung and LG, cost Rs 80,000-1 lakh.
Overall penetration of television sets in India, according to the Consumer Electronics and Appliances Manufacturers’ Association, stands at 45 per cent, the highest for any consumer appliance.