Ashutosh Gupta says that the company is looking to clock 25 per cent year-on-year (YoY) growth this year
Summercool Home Appliances, a brand majorly known in the air cooler category, is venturing into the air conditioner (AC) segment in September this year, its Director of Sales and Marketing, Ashutosh Gupta, told BW Retail World. The company is looking to make a ‘significant’ impact in the next two years in the non-metros.
“The launch would be happening in the month of September. Around the seventh or eighth of September. We will be having a meeting with all our distributors. We hope that in the tier two, tier three cities, we will make a significant presence in the next two to three years,” Gupta highlighted.
On the fiscal expectation front, Gupta stated that the company is looking to clock 25 per cent growth on a year-on-year (YoY) basis this year. For the next year in particular, we are looking for 35 per cent growth because it would be a new launch for the air conditioner,” he noted.
Explaining that the company has around 5 per cent share from ecommerce and around 10 per cent from institutional sales, Gupta added that the company has plans to grow them in multiple digits, around three to five fold over the next two years to take the contribution to 25 per cent.
Extending Reach Across Markets
When it comes to targeting the urban metros for the upcoming product category, Gupta highlighted that people are trying to incline more towards the online segment and modern trade segment.
“For the next year, we are planning to go live with multiple stock keeping units (SKUs) for the modern trade. And we are already placing our washing machine and other products on the ecommerce. So from there, we are going to target the tier one cities, he noted.
Gupta emphasised that the company’s main target this year would be the market reach and making sure that they make the product better every day. “Our company’s target is to give them a better experience. After-sales service is the main target. We want to understand their demand and keep them satisfied and happy,” he explained.
The Differentiating Factor
Noting that there is no such big difference among all the companies which have ACs, Gupta stressed that it is just the after-sales service which makes the difference. He added that the demand for ACs is increasing as people have more income in their hands.
“We have the right partners to get things done at the right time. AC is a luxury product for tier two and three cities. We have a huge demand in that sector, people want an affordable and trustworthy and good product,” he emphasised.
He also highlighted that now even tier-three cities want their product to be as advanced and affordable as tier-one cities. Gupta explained that affordability is a crucial factor in purchase decisions in tier three cities. “We are a homegrown brand. We do not have that many expenses compared to other international brands,” he pointed out.
The Gen Z Connect
With Generation Z (Gen Z) now dominating the family conversations, brands are forced to reshape and rethink the way they interact with the digital and design-conscious consumers. Gupta stated that the company is actively working to connect with the younger generation by consistent design upgrades and advertising creativity.
“It is not a traditional market anymore. Earlier, we were only doing an air cooler segment and home appliances segment. But from the last two, three years, we have been in the segment of LED TVs, washing machines, and now we are trying to go and launch the AC as well,” he explained. He also emphasised that the Gen Z people like their brand because they have a social presence on Instagram, Facebook.
Status On Enhancing Manufacturing
Highlighting that the company was actively looking to set up a manufacturing plant in Prayagraj, Uttar Pradesh, Gupta noted that supply-related problems played a key part in the plant not materialising. However, Gupta added that the company is building a large warehouse to cater to the needs of the particular area.
“Earlier, we had plans to put up a manufacturing plant in Prayagraj. But what is happening is the shortage, the raw material supply is becoming very hard currently because there is no such sort of manufacturing in Prayagraj. So what we are doing is making a big warehouse from where we can supply to all our distributors currently in that particular area,” he emphasised.
Explaining further, Gupta stated that if the company finds success in this model, then they are going to replicate it to other states as well. Gupta noted that the major supply-related issue was that the raw material had to be sent from the Delhi National Capital Region (NCR) only.
“It is a continuous job to make the product better every day. That is how we keep the R&D team doing the best they can and still enhance the product from customer feedback. We plan to improve our product according to the customer feedback,” he noted.
With the Centre now looking to cap the AC temperatures in the 20 degrees to 28 degrees range, Gupta stated that the company is going to follow the norm and will comply with the rules. “If the government pull off something like this, then the industry has to follow it, and we are also going to follow it. We cannot go against the industry and against the government norms,” he emphasised.
