The Godrej Proposition
Q] How do you maintain a balance between heritage and contemporary while charting your brand’s marketing strategy? The Godrej pedigree and its 117-year history bring in trust and warmth that’s required for a brand, in an era where brands come and go. We need to balance this with technology, and the key to retaining heritage values and being contemporary is to do it consistently. Every brand has to move with the times and be relevant to that generation. Today’s consumer looks at a brand as an extension of their personality and even the platform you use becomes the personality of your brand. The challenge is to create products and brand proposition that’s relevant, choose relevant platforms and have a communication channel open to connect with consumers. Q] Keeping this in mind, how do you then formulate your media mix? We have a very strong presence on Digital. We have over two million fans on Facebook, one of the largest fan-bases in Asia-Pacific when it comes to appliances, much ahead of most of our competition. Digital is all about communication and engagement with consumers - are you just talking about products or are you talking about things that matter to them? With brands and users of the brand existing on the same platform, brands have become buddies with their consumers and our constant endeavour is communicating and creating relevant propositions. Our biggest energy conservation consumer initiative ‘One Watt Campaign – Let’s Save a Billion Watts’ helps us talk to consumers, particularly the youth, on a topic close to them. This platform enables them to contribute to the society and more than one billion watts have been pledged in this campaign. We were also the title sponsors for Tour de India, another activity close to the youth. We have used these platforms to build a connect and establish Godrej as a meaningful brand in their life. We also use Television as one of the prime mediums of communication, though our presence in Print is limited. Our earlier communication was targeted at the 35-40 age group, but today our communication targets youngsters - people who have just got married, from SEC A & B, in the age group 25-35. We believe a relationship starts when you sell the product, so for example, we have chefs going to consumers’ home to teach them how to use our microwave products. Q] Innovation plays a big role at Godrej, how do you include it in your category of products? Creating value is important for us and we have an elaborate research process where we reach out to consumers, understand their needs and create relevant products and services in every category. For example, we created a musical refrigerator because music plays a big role in the youth’s lives and goes with their lifestyle. Pizza is consumed by them, so we launched our microwave which is also a pizza-maker. Godrej appliances have the largest digital interface across categories and segments - high-end or low-end. Our 7-star rated air-conditioner, which is energy efficient and saves money for the consumer, is the largest selling air-conditioner in the category. In each category, we identify the key drivers, develop services and products that create small delights and ensure consumers get maximum out of the product. In India, people believe that tough stains on collars and cuffs do not come out in washing machines. So, we recently launched U-sonic washing machine with a special ultrasonic attachment that effectively removes these stains. Q] While your competitors do undertake discount-led advertising, Godrej has refrained from this. Why so? We are not in favour of discount-led advertising. Our whole belief is that people today are value conscious, not money conscious. What we used to call earlier as value for money, we have just turned it around and call it money for value. Today’s consumer is willing to pay if he sees value in the product and if you create that value proposition, you don’t have to really worry about the price they will pay. Compared to our competitors, we are probably one of the most expensive brands in the marketplace, but have still garnered market-share and are growing healthily over industry growth. Q] Last year, Godrej Appliances missed its targets. How are things looking now? The first four months have been very good and we have seen growth in excess of 50% in most categories compared to last year. This is also because the last two years were not very good for business. There are three things that control the market – climate, currency and commodity. This year, the climate was favourable, we had an extended summer with intense heat which led to the growth. There is a pent up demand from the last two years, which had short summers and early monsoons. This year, we have been able to benefit from the positive sentiment. Q] So what are your growth expectations for the year? We are looking at minimum 25-30% growth. Q] What percentage of growth has come from Tier I cities versus Tier II and Tier III towns? Does your approach differ in smaller towns? The top 16 cities contribute almost 60-70% of our sales in most of our categories. We see a huge untapped opportunity in smaller markets through various other product categories. We are looking at disruptive innovation and have redefined and redeveloped products for these customers we will be targeting in the future. In smaller markets, it’s important to educate about the usage, ensure presence of strong distribution and service network. That’s our strength as we have the largest after-sales network in India, across 600 service centres. This huge network helps build the connect in markets where trust plays an important role. Q] Within your portfolio, what product provides the greatest traction? Which segment are you betting on looking ahead? Almost 55%of our business comes from refrigerator category and we have a market-share of 17-18%. We forayed into washing machines and air-conditioners about 15 years back and have a market-share of 10-13% and 8-9% respectively and largely operate in the high-end space. We are among the top four brands in washing machine category. In air-conditioners we are among the top five brands and the number one brand in the 5-star category. Even in the microwave segment, we are among the top five brands in India. Looking ahead, refrigerator will continue to be the main stay. We continue to grow in this segment and are making huge investments too. We have seen 60-70% growth in air-conditioners this year. We are also betting on microwaves, currently a small segment, which we believe will be a big category in the future. We will expand in the cooling space - refrigeration and air-conditioning, and would be looking at launching high end products. We are looking at cooking as a space, and washing and cleaning as a zone. Q] Multi-branded, exclusive brand outlet (EBO) or e-commerce, what is your retail strategy? We are very strong in multi-brand and have taken a massive bet on e-commerce. We are one of the largest players in the e-commerce space and work very closely with Flipkart, Homeshop18, Indiatimes and Amazon among others. We have also initiated our EBO and currently have five outlets with plans to expand to 20 over this year. About The Brand Godrej Appliances is the flagship division of the $ 3.3 billion Godrej & Boyce Mfg. Co. Ltd (G&B). Godrej forayed into appliances in 1958 and has created many milestones in the Indian appliance space with regard to environment/ energy/ efficiency. It is credited with the launch of the first green AC in the world, the first green refrigerator in India, the first 5-star range of refrigerators, the first inverter AC in India, the first refrigerator with 6-star performance. In the consumer delight space, launches included the music refrigerator, ultra sonic technology in washing machines, DAC (dynamic aqua power control) technology, tilt drum in washing machines or steam microwave ovens and pizza/kebab makers in microwave ovens. Godrej is the first and only company to be given ‘Platinum Green Co’ certification by CII. Facts Creative agency- JWT Media agency- Mindshare Social and digital media marketing agency-WatConsult PR agency- Madison PR Marketing tip CMO File
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