Work from home has led to an increase in sales of our home appliance range: Vijay Babu, LG Electronics India

• In our latest series, we talk to brands about how they have been marketing during these adverse times, the things they have learnt and how they are preparing for the somewhat uncertain future.
• Vijay Babu, VP - Home Appliances, LG Electronics India tells us how there has been a surge in the demand for the brand's home appliance products as people have been staying at home and trying to find a balance between house work and office work with the help of products like washing machines and dishwashers.
• He is also optimistic about a good sell-out during the festive season due to the increased relevance of products that help in strengthening people's health and hygiene.

The lockdown, while has had the obvious impact on our lives, has also had some indirect impact on a lot of businesses. For example, the fact that we are all stuck at home has led to more consumption of content on TV and OTT platforms.

Meanwhile, considering we are all working from home, demand for home office setups and even mattresses are seeing an increase. With gyms shut for business, people are working out at home, thereby leading to an increase in demand for the athleisure category too.

Something similar has happened with LG Electronics too. Since the lockdown has made willing or unwilling multitaskers out of all of us, the demand for dishwashers and washing machines, categories that make our daily existence easier, have seen an increase.

Since the lockdown is slowly being lifted, brands are witnessing the impact of pent-up demand. Even for LG, their home appliance range has witnessed an increase in demand in the past few weeks.

We recently caught up with Vijay Babu, VP - Home Appliances, LG Electronics India to understand the kind of business impact the lockdown had on the brand and how they are working towards strengthening their place in the hearts and minds of the customers.

Excerpts:

Q) Considering the complete closure of retail outlets, malls, manufacturing units etc., what kind of impact has there been on LG's business in the last few months?
The onslaught of the coronavirus pandemic has had a major impact across the economy in all sectors, while rapidly spreading across the world without any regard for national borders, class, gender, or communities. In these times, brands are facing the brunt of adapting to the ‘New Normal’ in a very short span. At LG Electronics surprisingly our customers have been by our side and in fact, working from home has led to rise in sales for our home appliance range.

The two key factors behind this rise in demand, has been the onset of summer- leading to the need for compressor products like air conditioners etc. The lockdown has also ensured multitasking as a necessity for various working professionals. For them, a dishwasher or washing machine have become essential to balance household chores along with professional duties. In the last month, the economy has slowly opened through limited restrictions from the government. This has led to a major rush in purchases from the pent-up demand of the last few ‘lockdown’ months, as seen in June. However, a lack of liquidity in the economy is still prevalent cause of concern and we hope to assist our customer base in every way possible, till the economy comes back to normal.

Q) What kind of festive season are we looking at this year? Do you think consumer sentiments will turn and people will buy during the festive season?
This year is expected to be different than others, due to the pandemic. It is also affected by the economic repercussions from it, leading to restricted incomes for several families. However, consumer sentiments have been changing drastically in the last few months, it is too soon to predict how the festive season will be in terms of consumer demand. However, considering the unique Health & Hygiene benefits offered by LG Appliances, and their increased relevance and significance in the current scenario, we are extremely confident, for a good sell-out during the festive season.

Q) As a brand, what kind of changes are you anticipating in consumer behavior? How are you working on embracing these changes and working around them?
People are living differently, buying differently and in many ways, thinking differently. In fact, their way of looking at a product while buying it has also completely changed and the new habits created is expected to transcend crisis, permanently changing the consumer decision making process. In the consumer durables industry, we are already observing a change in consumer behavior. Various surveys have indicated that consumer durables remain a top priority on the purchase list post-lockdown. There is a demand for bigger capacity appliances with larger storage to have better stocks, especially in washing machines & Refrigerators.Consumers are also interested to know the origin of products; they are looking for products manufactured in India.

We have seen a good demand among customers for refrigerators this 2020 season. In fact, the twin drivers for the refrigerator market are ‘Enough Storage’ and ‘Ensure Hygiene’ of the stored Items. Features such as water and ice dispenser on the outside or a small home bar compartment; number of shelves in refrigerator; maximizing the storage in door for frequently required items have been in trend with our consumers this year.

Steam function in washing machine & dishwashers is preferred by consumers as they want to be sure about hygiene aspect.

Q) Were there any interesting consumer trends during the lockdown that perhaps you did not anticipate? Any product vertical that saw a sharp increase in demand? Do you think demand for segments like dishwashers and vacuum cleaners will continue to see an increase in the post-Covid world?
We have seen a huge jump in dishwasher sales; in the future, we predict an increase in consumption of vacuum cleaners & dishwashers as people continue doing their own chores. Televisions have also seen a major growth in demand, due to the attraction to home screens for indoor entertainment. Consumers are also preferring ‘Made in India’ products in accordance to the government’s ‘VOCAL FOR LOCAL’ campaign becoming a significant driving factor. According to a Nielsen survey, 28% consumers in 12 cities across the country are open to the idea of buying a home dishwasher or microwave among other home appliances in the next few weeks as the country wakes up from the lockdown. This is valid even as all other additional expenditures including going on a holiday, buying a vehicle like a car, or renovating the house, has been put on hold.

We are predicting a pent-up demand for home appliances in the next few months and have been preparing for it to provide customers easier ways to get access to our products through digital e-commerce platforms or through our sanitized retail shops.

Q) The summer demand for products like ACs would have seen a major hit due to the lockdown. Are there chances of a recovery in terms of sales in the remaining part of the year?
Yes, at the onset of the pandemic we found a dip in our summer product sales. However, this trend did not continue for long, partly due to opening of the economy as well as the summer heat. In fact, we had 10-day period in May when the AC sales shot up three folds and even in June, we have witnessed the same trend especially in the Northern Region. Henceforth, we are positive that the demand for white goods like air conditioners will continue to improve despite the pandemic.

Q) It is important for brands to stay connected with consumers even during adverse times. How did you ensure that connect during the lockdown? What kind of communications did you put out?
Safety is an essential concern for all, and the ‘touch and feel’ part in the consumer buying process might be reduced significantly at this juncture. Henceforth, customer engagements through digital platforms have become the norm to communicate key messages. At LG Electronics, our social media channels and website have been the biggest platforms for us to communicate unique product benefits to our audience. Not only this, we have also posted DIY (Do It Yourself) videos for repairing productsas well as options for pre-booking products. These engagements were taken ahead with the motive to help existing customers, who can order a home repair session from us as well as new customers who might be interested in our products but cannot avail it due to the lockdown.

Q) Did your overall media mix change during the lockdown? Will it change again, in the post-Covid world?
During the lockdown, the media mix has consistently veered towards online media. We have tried to create engaging content which can cheer up people’s spirits; for example, on Mother’s Day we created a video to salute COVID warriors. The same received a significant amount of traction in media and audience.

A healthy media mix is important to a brand, to increase the reach of communication; in the post-COVID world, we will see an integrated media approach. As a brand, we must wait and watch where the media trends take us. However, since consumer behaviors are shifting towards the ‘new normal’ where safety is prioritized, we believe digital platforms will become the new norm.

Q) What were your key learnings from this experience?
We are celebrating our 23rd anniversary in India this year and over the course of these years we have strengthened our market leadership due to a strong product portfolio developed through customer insights in India. This pandemic has brought us closer to consumers and thus, our key learning has been offering solutions as per consumer’s needs; Home Appliances were a key priority for them and we have designed various programs to reach out to consumers both in terms of new product delivery & service of existing products.As a brand, we hope to be empathetic as we create products to help our customers move on from the trials and tribulations of this pandemic and get used to a ‘New Normal’.