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<ul><li>After the lockdown froze the sales of the cooling products last summer, Voltas witnessed a good come-back during the festive period due to pent-up demand.</li><li>Pradeep Bakshi, Managing Director and CEO, Voltas Limited is confident that this trend will continue in 2021 and help them achieve a double digit growth.</li><li>He shares how the brand has managed to stick to its leadership position despite the curveballs that COVID has sent its way and his plan to expand its market share this year.</li></ul> The onslaught of sweltering summer and the extention of working from home for most people has had an obvious, positive impact on the air conditioning industry. As people try to make their homes more comfortable during the summer as they spend more time indoors, the direct effect has been higher demand for air conditioning and cooling products. Anticipating the increased demand for its products, leading AC manufacturer Voltas has outlined a 360-degree marketing plan to further increase its market share. It is confident of witnessing double-digit growth this summer, which is its peak season as it brings in more than 50% of its room AC sales. According to Motilal Oswal Research study, Indian Room AC market has grown at ~10% CAGR (in volume) over FY10–20 and Voltas is the leading player in the market. <div type="image" title="Indian AC market" msid="82035328" hostid="261"></div> <div type="image" title="ac players" msid="82035336" hostid="261"></div> The Indian AC industry is sized at Rs 180–200 billion. According to Tech Scientific data, it is projected to grow at a CAGR of more than 17%, to surpass $ 11 billion by 2023. However, the air conditioning and cooling products market was adversely affected in the first half of last year due to the nation-wide lockdown, with sales coming to a grinding halt during the category’s peak season. AC is a highly seasonal sales product and it sees its peak during the March-June period. However, despite the Covid-induced speedbump, Voltas was able to maintain its leadership position in the AC category, thanks to the resurgence of demand during the festive season. “We are delighted to report that despite the pandemic situation, we maintained our market leadership with a 26% market share in the room air conditioners category. The Cooling Products business made good recovery, post easing of the lockdown situation. As of last quarter, we achieved a YoY growth of 46% over the same quarter (non-covid period) of the previous year,” shared Pradeep Bakshi, Managing Director and CEO, Voltas Limited. Voltas earned Rs 28,516 million revenue last year, as per Motilal Oswal. The brand maintained its leadership position, followed by Daikin at Rs 26,166 million. Voltas is hoping to see a similar momentum this year as well. Sharing his outlook for this year, Bakshi added, “The performance of the Air cooler vertical too has been satisfactory with a growth of 11% over the previous year. Based on latest market share figures, we are now at the number two position overall. We expect this momentum to continue in the next few quarters. Overall, I am optimistic about double-digit industry growth this summer.” Elaborating on why Voltas is optimistic about seeing a double digital growth, Bakshi said, “This summer, we are already witnessing a robust demand for Room Air Conditioners and our range of Cooling products like Air Coolers and Commercial Refrigeration products. This is due to the India Meteorological Department’s (IMD) forecast of a strong summer this year, across most regions of India. The work-from-home hybrid routine is expected to continue for some more time, thus leading consumers to continue looking for home appliances and cooling products that help with the burden of household chores, and make their work-from-home scenario more comfortable." Marketing strategy this year In line with the motto of ‘Keeping India Cool’ since 1954 and being the ‘cooling experts of India,’ Voltas recently launched its Air Cooler <a href="https://twitter.com/myvoltas/status/1374591244500750338" data-type="tilCustomLink">campaign </a>‘Ab Garmi Ke Mazey Lo, Bina Garmi Ke.’ The campaign taps into the emotions of Indian summer and highlights that with Voltas’ Air Fresh Coolers, the consumers can enjoy all the good things that summer season brings along, and say goodbye to heat, humidity and sweat. And this year, Voltas is spending 25% of its marketing monnies on digital media. To increase its affinity and sales further, Voltas will stick to a 360-degree approach. “We, at Voltas, believe in having a holistic 360° strategy, where we focus on being accessible to our customers in multiple formats. As part of this, we have adopted an Omni-channel strategy with an emphasis on offline as well as online channels. This largely helps us customise our approach to suit the different markets in the rural, as well as urban areas, across the country. With consumers at the centre of our universe, our marketing initiatives have always included campaigns that can easily identify with consumers. We have a record of demystifying technologies and creating meaningful campaigns, which stay relevant for the consumers for years. We will continue to have the highest Share of Voice in the Cooling products category, with a heavy presence across electronic media. Further, keeping in mind the trend of consumer media habit consumption, over 25% of our Advertising spends will be on Digital,” said Bakshi. Vision for 2021 According to Motilal Oswal research study, India’s AC industry is highly competitive, with 35–40 brands playing the penetration story in India. The Top 6 players enjoy 75–80% market share. So, there’s still a huge scope for Voltas to grow further. It also outsources 40% of its services and Indian companies are working towards minimising their dependence on external sources and imports. Sharing the brand’s strategy to increase its market share this year, Bakshi said, “Voltas has strengthened its market leadership with close to 26% market share in the Room Air conditioners. And we are not just ramping up production in our existing factories in Pantnagar, Waghodia and Sanand but also working towards enhancing the production capacity of Air Conditioners through another plant in the Southern region of the country. So, for the upcoming summer season, we expect more traction in urban and mini-metros, due to the high level of penetration of branded cooling products in these markets. To address this growing demand, we have taken some key steps like shifting stocking focus to high demand goods, penetration in more rural, less affected zones and increasing the manufacturing capacities. As the pace of electrification increases and the expected trickle-down effect on consumer durables is likely to be witnessed, given the increasing disposable incomes, demand from rural as well as Tier 2 and 3 cities will also increase.” The brand has opened new shops in Tier II and III cities. It aims to drive the highest distribution reach and market share across all Tiers of population strata and strengthen its leadership position in urban and semi-urban areas this year.

Air conditioner and cooling brand Voltas India eyes double digit growth this summer

KOLKATA: Voltas established a clear lead in air-conditioners sold through multi-brand outlets in the past fiscal year, dethroning <keyword id="6356116" type="CITY" weightage="80" keywordseo="LG">LG</keyword>, the first time in almost 14 years that a local manufacturer was able to topple South Korean companies in any major segment in the fiercely competitive Rs 50,000-crore consumer electronics market. 
 
This follows a year in which Voltas emerged as a front-runner in the category, fighting LG for ascendancy. The performance by Voltas came in the face of scepticism that success in FY13 had been a flash in the pan and that no domestic brand could make a dent in the dominance of the multinationals in multi-brand outlets, where 90% of total industry sales take place. 
 The <keyword id="6383291" type="COMPANY" weightage="40" keywordseo="ACS">ACs</keyword> made by the <keyword id="6355725" type="CITY" weightage="40" keywordseo="Tata-Group">Tata Group</keyword> unit had a 20% share in multi-brand outlets followed by LG at 18% and Samsung at 10.8% in the April 2013-February 2014 period, according to the latest data from market researcher GfKNielsen that tracks sales in the durables industry. Voltas is ahead by value as well at 18.9%, followed by LG at 17.9% and Samsung at 10.6%. 
 
This was the first full year in which Voltas sustained its leadership throughout, with LG having fought back to the top in some months in FY13. 
 
However, LG is still the market leader when counting sales in multi-brand outlets and its own exclusive stores. 
 
As per GfK-Nielsen, LG India has a 22% share by this measure, with Voltas at 18%, followed by Samsung at 14%. Since multi-brand outlets account for the dominant share of AC sales, it's a fair measure of competition, said Pradeep Bakshi, president and COO, unitary cooling products business group. 
 
“We are targeting more than 25% share this year. For this, we have launched more than 90 models,” he said. LG India seemed to reject the reasoning offered by Voltas. 
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	“We would like to mention that LG is market leader in AC segment and figures mentioned in the mail are representing manipulative and incorrect form of market share,” it said in an email without responding on other queries sent as part of a detailed questionnaire.
To be sure, as a delayed summer gets under way, LG will be more than ready to unleash the might of its vast marketing machine. Voltas will have a tough task as LG has been pushing back hard with higher margins this season, said a senior executive of a leading electronic retail chain. 
 
“Another area where Voltas has not worked hard is to increase the appeal of the brand among younger consumers, for whom Hitachi and Daikin are the preferred brands and may settle for a LG or Samsung if budget does not permit,” he said. 
 
Still, the turnaround at Voltas is big news at Bombay House, the Tata group headquarters, considering the many Indian brands that lost out after LG and Samsung entered the Indian market in the late 90s. 
 Homegrown brands such as BPL, Videocon, Onida, <keyword id="6369697" type="COMPANY" weightage="40" keywordseo="Godrej">Godrej</keyword> and Voltas lost lustre starting 2000-01, with the South Koreans kicking off their marketing thrust. IFB was one of the few Indian brands to maintain its grip on the market in the niche front-loading washing segment until about four years ago, when LG took over as leader. 
 LG India has built the country's largest network of company-branded exclusive stores in the durables industry, with more than 1,800 such franchisees. As per estimates, such stores account for around 20% of LG India's sales, the highest contribution from this category in the industry. However, AC makers including Hitachi, Daikin, Voltas and <keyword id="345443" type="COMPANY" weightage="40" keywordseo="Carrier">Carrier</keyword> have not focused on setting up exclusive stores since most AC sales take place in multi-brand stores such as local outlets, regional chains and modern retail. 
 
The executives most credited with the Voltas turnaround are Bakshi and managing director Sanjay Johri. The process started eight years ago when Bakshi was given the task of turning around the air-conditioner business by the board, with the condition that if he failed, the business may be sold. At the time Voltas was at a negligible 6-7th position in the market, with accumulated losses of Rs 140 crore. 
 
“Regaining market leadership has indeed been a Herculean task, considering LG was a tough market leader and the AC category has been one of the most penetrated with more than 25 international and domestic brands jostling for their share of the wallet,” said Bakshi, who joined Voltas after stints at Electrolux and Godrej Appliances. Bakshi’s strategy involved launching India’s first energy efficient air-conditioner in 2007, three years before the government made energy ratings mandatory, pricing the models Rs 2,000-3,000 higher than LG and Samsung. Advertisements said energy efficiency would lower electricity bills. 
 
He also shut two factories that could not produce such models. In 2012, Voltas launched its biggest success to date -- the all-weather AC range. He also employed one of LG's strategies to great success. “The AC business was traditionally done by dealers who would specialise in this field. LG had changed the game by selling AC in the general trade and we too decided to follow suit. We currently have more than 9,400 such outlets where our products are sold. This changed the game for us too,” said Bakshi. 
 
The air-conditioner business is now the highest contributor toward profitability for Voltas, encouraging Bakshi to draft a blueprint to expand the brand into household appliances such as refrigerators and washing machines with a target to expand revenue to Rs 5,000 crore in five years. The business is the second-largest revenue contributor for Voltas, after electro-mechanical projects and services, with sales of Rs 1,835 crore in 2012-13 with a profit of Rs 173 crore. Total net sales for Voltas in 2012-13 amounted to Rs 5,514 crore . 
 
The brand lends itself very strongly to the domain of air and water, said Deba Ghosal, head of marketing and key accounts. “If you add our pedigree of cooling expertise, leadership position, and the trust factor of a Tata brand, the possibilities to expand into other categories are immense,” he said. 
 
Bakshi acknowledges challenges ahead such as increasing appeal to younger consumers. “But we are on the way. For instance, this year we have launched a smartphone app to control the AC and are also targeting social media,” he said. 
 
Bakshi is also betting on his new team, which consists of seasoned talent from the industry. This includes Rahul Jain, who joined from LG to head service, Ghosal, another ex-LG India executive, and Manish Desai, who moved from Onida to head finance.

Voltas Topples LG, Samsung In Consumer Electronics; Grabs No 1 Spot In ACs

<keyword id="2746883" type="General" weightage="50" keywordseo="key-highlights" source="Orion">Key Highlights</keyword> for April '22: <ul><li>Room Air Conditioner category recorded an unprecedented growth of over 170%</li><li>The overall Cooling Products segment grew by more than 160%</li><li>Commercial Refrigeration category grew by 125%Voltas <keyword id="1762359" type="General" weightage="50" keywordseo="beko" source="Orion">Beko</keyword> home appliances segment grew by 75%.</li></ul> <keyword id="452495" type="General" weightage="50" keywordseo="voltas-limited" source="Orion">Voltas Limited</keyword>,, from the house of <keyword id="8555" type="General" weightage="50" keywordseo="tata" source="Orion">Tata</keyword>'s, recorded a triple-digit growth in April 2022 , due to an increase in demand for cooling products given the intense summer experienced across the country. The volumes of April 2022 in the cooling products segment has broken many records. <keyword id="6354999" type="General" weightage="100" keywordseo="voltas" source="Orion">Voltas</keyword> has been the undisputed market leader in the Room Air Conditioner category since more than a decade, consistently maintaining the No. 1 position and has steadily maintained its lead over competition, with a lead of more than 640 BPS over nearest competitor as on YTD March FY22. The brand is now gearing up to meet its business objectives for FY 23. Commenting on the performance, Mr. <keyword id="272815" type="General" weightage="50" keywordseo="pradeep-bakshi" source="Orion">Pradeep Bakshi</keyword>, Managing Director &amp; CEO, <keyword id="201377" type="General" weightage="50" keywordseo="voltas-ltd" source="Orion">Voltas Ltd</keyword> said, "The summer of April 2022, has helped us gain an unprecedented growth in comparison to the last three years. Our Room AC business has grown up by over 170% in volume. The overall cooling products business has grown by more than 160% while our Home Appliances grew by 75% in volume. In Commercial Refrigeration, the company has grown by 125% in volume in April 22. We believe that our wide presence, focus on the emerging channels, excellent distribution network, strongest brand equity and attractive consumer offers, will help the brand stay ahead of the industry" He further added, "We are well poised to meet the growing demand, and are optimistic about achieving our business objectives for the financial year FY23." Besides its 24,000 customer touch points, Voltas also has a widespread network of exclusive brand outlets (EBOs) and plans to launch many more Brand Shops and Experience Zones by the end of FY 23. The Company has recently launched a dynamic product portfolio for the summer, and several Brand Shops in Tier 1, 2, and 3 cities across the country, to meet the expectations of consumers in these markets and enable them to experience the best-in-class technologically advanced products. Disclaimer: The following press release comes to you under an arrangement with PRNewswire. PTI takes no editorial responsibility for the same.

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