Demand set to decline by 14-16% in fiscal 2021.
Growth was expected to double to Rs. 11 lakh crore by 2025 from the current Rs. 55,000 crore. It is largely driven by ACs, refrigerators and washing machines.
Post lockdown it will take time to streamline & manage inventories. Impact likely to be felt only towards the end of Q4 due to inventory stock.
Product prices could see an increase to minimize loss.
Supply disruption due to shut down of manufacturing units. India imports nearly 45% from China adding to further disruption.
Source: Hindu Business Line, Money Control, Deloitte report, CRISIL Research.
Staying at home more often means spending more time with all the appliances in the house. This means more scrutiny of each and need for upgrades in some.
Because they can’t step outside, people have started doing a lot more of the outdoor activities at home like working out, baking. This in turn may given rise to new needs at home.
People may stick to basics. Stepping outside only to buy essentials as they may be constantly worried about the risks of getting infected in crowded places.
Consumers may change their traditional shopping habits. Digital adoption may increase at a faster rate with dependency increasing on e-commerce and m-commerce platforms.
Never before have people been confined to their homes for so long. Hence, consumer durables have become an extension of oneself, much like mobile phones, Appliances that aren’t working may be replaced, the ones that are okay might be upgraded and the new ones that one needs might be installed soon. Since one can’t go out in the world anymore, the world may need to come home.
Technology might be used to make virtual experience more engaging. Retail stores could be designated more for experience than sale ( e.g. Pepperfry & Urban Ladder)
Adapting an omnichannel ecosystem might play vital role in enhancing consumer experiences.
Online stores could help increase penetration and boost sales. E.g. IKEA Mumbai. Collaboration with e-commerce platforms could help manage logistics.
High consumption of OTT platforms may increase demand for better mobile phones & laptops for a richer experience. Not everyone may be willing to invest in a smart TV and therefore economical alternatives like Fire Sticks and Chromecasts might be the new solution.
The means to entertain may change with innovative ways. to engage oneself at homegaming consoles for self or kids may rise. Xbox or Playstations sales may grow.
People seeking entertainment at home means more house parties which in turn might pump up the market for Bluetooth speakers and Home Entertainment systems.
With heightened focus on health and immunity building, need for water purifiers might rise. Upgrading to better versions that give enhanced protection may rise as well.
People have started trying out new recipes in the kitchen, a habit that may stick. This may give rise to new specialized appliances in the kitchen or upgrading of old ovens and microwaves.
Enhanced deep cleaning solutions and maintenance of hygiene will be of importance. Appliances like a vacuum cleaner may become the new practice.
Consumers might unlock their hidden potential and may feel the need to keep it activated even afterwards. Maintaining fitness at home through equipment or pursuing their passion for food through new appliances, might see a push in product categories that were not so dominant before.
General upgrades may happen as people spend more time at home and realize the importance of each product. If they are spending more time at home, they might as well make everything around them better.