For Haier, however, the ambitious target is merely a signal of its intent towards the Indian market. “India is already the highest contributing foreign market for brand Haier (after China) and it remains one of the most strategic markets for the firm globally. We are committed to strengthening our presence here,” says Eric Braganza, president, Haier Appliances India.
But its rivals Voltas and Whirlpool are no pushovers. Voltas forayed into the durables market with its Beko brand last year and Whirlpool said in February that it was investing over Rs 400 crore in the next five years to improve manufacturing capacity. LG and Samsung too count India as an important market and will keep a close watch on Haier. Other players including Panasonic, Blue Star and Godrej Appliances can’t be ignored either, say experts, implying that Haier has a tough fight ahead.
Coming in when local labels such as Videocon and Onida called the shots besides foreign names such LG, Samsung and Sony, Haier, say industry experts, was strategic in the way it capitalised on market churn in the last 15 years. Videocon and Onida, for instance, are no longer in the top five list and Japanese majors such as Toshiba and Akai, among the early entrants, are not visible today. Sony operates in the TV market only, in line with global corporate strategy.
The gaps in the market allowed Haier, say experts, to quickly consolidate its position, which it did by building its equity in the market and wooing customers who had been left in the lurch. The company has also introduced innovations that cater to the unique needs of the country.
This week, for instance, the company launched air conditioners that come with air-quality detection technology, allowing it to quickly adjust to the quality of air. “The only way we could have stood out in a cluttered market was with the innovation we brought to the table,” says Braganza. Haier has supported these launches with an aggressive go-to-market strategy involving dealer promotions and consumer campaigns that have helped in inducing recall.
“We've been consistent throughout in our effort to reach consumers,” says Braganza. “For our bottom-mounted refrigerators, for instance, the marketing strategy has evolved over the years starting with the ‘Ab Seedhe ki aadat daal lo’ (get used to the right side up) in 2018,” he says.
The market has been receptive to these launches, prompting Haier to invest close to Rs 3,700 crore in two domestic manufacturing units over the last two years. The first industrial park, which was launched in November 2017 in Pune, saw Haier invest close to Rs 600 crore to upgrade the unit, which earlier produced only refrigerators. It now churns out washing machines, air conditioners, water heaters and LED TVs.
Last week, the company commissioned its Greater Noida plant at an investment of Rs 3,070 crore, which will be set up by the end of 2020. The unit will help the company scale up as it gears up for a bruising battle ahead.