Cool strategy

Mumbai, March 16: LG Electronics and Voltas Ltd, leading players in air-conditioners (ACs), are vying with each other to attract more customers by offering a better product range at affordable prices.

LG, the market leader in this segment, is targeting a growth rate of 60 per cent this year, which should see sales exceeding 4 lakh air-conditioner units against 2.8 lakh units in 2003.

Country head, sales and marketing, air-conditioner division, Salil Kapoor said the 60-per cent growth rate, which is two to three times that of the industry, should come from a combination of a larger product range catering to varying consumer needs and an increased penetration, particularly in smaller towns.

Kapoor is particularly optimistic about the Whisen range, which he says will sell over 40,000 units in its first year. LG’s air-conditioner division has generated Rs 500 crore turnover last year that translated to a market share of 30 per cent, according to the Francis Kanoi report of April 2003.

The Whisen range was launched by the company after it realised that the market composition is not uniform and a premium range of air-conditioners is essential to cater to a target audience.

On the other hand, Voltas, from the house of Tatas, is looking at bridging the gap with LG. The company, claiming to occupy the second slot in the industry, is now ambitiously targeting the mass market.

It recently launched a range of ‘affordable’ air-conditioners called Vertis sub-one tonne. While the new range is available at a retail price of around Rs 10,000, consumers can also buy them in easy monthly instalments.

“This range of air-conditioners is affordable and accessible to the larger section of households,” a senior Voltas official said. He added that the company is also trying to push consumers into buying more than one air-conditioner for their homes.

“We are giving a value-for-money product to the mass market and we are confident that this will tempt consumers to buy more than one air-conditioner,” he said. The company is focusing on the premium and popular segments as well.

Even as this new range is available at more than 1000 retail outlets, Voltas is planning to leverage on the huge shareholder base of the Tata group to ramp up its customer base. It is offering a special discount on air-conditioners for shareholders of the group.