Brand Speak on Electrolux Kelvinator

by Anand Bharadwaj Executive Vice President (Marketing and Marketing Services), Electrolux Kelvinator

Q. How long have you been in the Indian market? What plans do you have for the Indian market? Being one of the front-runners in white goods segment, what is your marketing strategy built around?

I think we have come to the market place last in the segment of white goods / consumer electronic goods & home appliances company operating in India. All though we came into this business in 1995, we really started our thrust in the Indian vital market in 1997, when we re-launched the Kelvinator brand in India. Prior to that, the Kelvinator was marketed by Whirlpool for 2 yrs. Only in January 1997 we re-launched the Kelvinator brand under our management. So, we have been in the market place for the last 5yrs or so. In that range of time we have made significant inroads in the refrigerator market.
If we go back in history then last yr we were the largest company in terms of shares in refrigerator market. In washing machines we have not really made the same kind of inroads as we made in refrigerators. But obviously our long-term plans are "to become significant players in the washing machine market as well". We have recently developed a revolutionary washing machine, which we call the Washy Talky & are launching it soon. I am confident that it will make our presence felt in the washing machine market as well.

Q. How are your brands positioned? What kind of differentiating strategy do you use?

Right now we are in the middle of developing different brand strategy. Let me just go back to history, In India we acquired a number of brands - Kelvinator was already there when we came. In 1995 we launched Electrolux in the front door washing machine segment. In 1998 we acquired two different brands-Voltas and Allwyn. And if you look at early 1999, we were there in the market space with four different brands- Electrolux, Kelvinator, Voltas and Allwyn.
But we have clear and distinct strategies for each brand. For e.g., if you look at Kelvinator, it is a brand inthe refrigerator segment only and is positioned as 'the coolest one'. Allwyn was positioned around durability -built for the long run- 'Allwyn chalta hi jaye, rukna iska kaam nahin'. Last year, we introduced a new range of Allwyn refrigerators called Sensor with the same theme 'Allwyn Sensor goes on and on and on...ruk na iska kaam nahin'. Electrolux is positioned on freshness plank with a tag line saying -'enjoy the freshness'. On the other hand Electrolux Maxclean was positioned around effective dirt removal and that's why advertising was around dirty children. So, just to summarize we are following a multiple brand strategy and each brand had a very clear position and a very clear focus. What we are doing now is consolidating our brand portfolios as the market place has been very sluggish & there is intense competition in the marketplace.

Q. Indian customers are willing to have world-class products at an affordable price. Comment.

First of all, let me say that consumer is the king. Whatever the consumer wants you have to give him. If you don't give him, the competition will give him and he will go to your competitor. Every company should understand what the consumer wants & that's the first thing! Secondly, every company must give international quality products. However, companies are there to make money, nobody wants to loose. You can't give a Mercedes Benz at the price of Maruti 800! Each company has to figure out what is the right balance between quality and price. If you want to give something, which is really of outstanding quality, then you will have to charge the price for it. On a larger scale you really can't afford to give a 500L refrigerator at the price of 300L refrigerator, because cost has been taken into account. To summarize what I'm saying
You must obviously give the consumer what they want. If you don't give it to them they will go to the next competition for the product they want.
In any category you must offer the best product at the right price. Certainly, all the products should be of international quality because Indian consumers are getting a good exposure through media, they travel abroad & get to see what kind of appliances is available!

Q. What do you think is the best possible communication-mix for any consumer durable category? You in the recent passed have sponsored IIFA awards, what do you think, whether more emphasis should be on above the line activities or below the line activities?

Every company must see that they have a proper mix between above the line activities and below theline activities. And it is very difficult to have a strict formula for what really we need to do. The role of both the activities is to communicate to consumers & to communicate effectively with dealers as well, because, in white goods unlikely in FMCG, dealers are also very important receivers of communication as they also play a very important role in brand choice, telling consumers which brand you should go for.In above the line, there is a debate on whether you should put money on television or on print. I really feel that again there should be judicious mix between television and print. Of course if you look at sheer nos. TV will always outscore press. That is why we and lot more companies tend to pool a lot of money on television but we back it up with certain amount of press advertising which really allows us to give the names of the dealers and if the consumer picks up the newspaper today and is going to buy a refrigerator then it becomes far more easy to see the print ad and go to the market place. Similarly, there has to be judicious mix of above the line advertising and below the line advertising. IIFA awards you were mentioning was really to create excitement around our brand Electrolux Kelvinator and we hope that it has been achieved.

Q. In the last few years promotions have increased and some professionals seen to suggest that above the line advertising has lost some of its effectiveness. Do you agree? If yes, why are the companies looking for newer and innovative ways to reach the customers?

No, it's not totally true. In-fact you will find more companies spending more money on above the line advertising. Yes, last year there have been a bit of pressure because of a sluggish market growth and recession in the Indian economy. During this period companies drastically cut down their ad budget and were looking at newer and innovative ways to reach their target customer. But, this year, we and many other companies have invested heavily on above the line advertising 'mainly in TV'. I feel TV has far more reach than any other medium as it provides both hearing and visual effects. Promotion is there but up the line advertising has not lost its effectiveness. We have invested in both up the line and below the line advertising for our brand. As, we had sponsored the IIFA awards; we have similar plans in future too.

Q. What is your advertising strategy for refrigerator segment this summer?

It's going to be a mix of TV and press. If I have to give you a cut off, it would be 70% TV and 30% press and you will notice that most of the companies like Samsung, Whirlpool, Godrej are spending a lot of money on TV & there you have Electrolux Kelvnator as well.

Q. How was your last year's performance?

For last year, the only way of judging performance is ORG figures vis-à-vis competition, understanding how industry did, how did we do relative to competition. ORG is the only tracking device that we have today. And if we look at the ORG figures for the last year we have gained market share both our major Electrolux brands - Kelvinator and Allwyn. So, to that extent we have done well vis-à-vis competition.
Q. Has the rise in number of media buying and planning agencies affected you? Has it helped your brand to grow as they get best possible rate in the market?

No, it doesn't matter whether it is a media department of an ad agency or it is an independent media planning and buying house like Mindshare or Carat, the client would expect to get the best rate possible, especially, if you are a large spender with them. Our entire evaluation on any agency that buys for us depends on what kind of values they have given us both qualitatively and quantitatively. If we find they are not been able to offer the value that we demand and somebody else is offering then obviously we have to re-look at our relationship with the agency. We expect our agency to give us best value for money.

Q. Are you more inclined towards consumer research?

As I mentioned earlier-'Consumer is the King' and therefore it is important to have the pulse of the consumer for every element of marketing mix. That is, before introducing a new product in the market, we try and figure out with consumers whether he likes that product or not. For example, if I am introducing a new color or a new advertising campaign, then I would first like to know whether the consumer likes the particular color or appreciate the advertising or not! So, we are very consumer oriented to that extent, for every element of the marketing mix we try and figure out or trace the reactions of consumers. And if we find the consumer rejecting a particular product or particular piece of communication or any thing in the market mix, then we go back and try more. We are also firm believers in terms of tracking consumer reactions on a regular basis.
Q. Do you have separate target groups for all the four different brands?

We have different target groups as we have a multiple brand strategy. But, let's take a look at lavish brand today, which is Kelvinator. It is a brand which cuts the upper strata. If you look at the refrigerator market today, 70% of the market is below 200l refrigerators-they are the bulk consumers to you. So, they become the core audience. Yes, you really cannot create communication that talks to the lower end of the market because then there you may eliminate the top layer of the market place. You have to strike a proper balance in your overall strategy so that you can appeal to the entire spectrum without eliminating any of those people.