The washing machines market, having exhibited steady growth over the last few years, nevertheless, remains a highly under-penetrated product when compared with the global average.
Washing machine is undoubtedly one of the home appliances that have most revolutionized consumers’ living habits since its introduction and its massive adoption in the last few years.
Continuous technological advancements and product innovation in the design of home appliances has led to the development of advanced washing machines that increase comfort levels and convenience of users. Companies are constantly introducing advanced, innovative features. With more capacious drums, less bulky motors, and diversified programs depending on use, from the structure, hardware, and software point of view, washing machines live a constant evolution.
The improving living standards have made home washing machine an essential home appliance in the Indian market. The changing environmental dynamics, urbanization, and rising income levels are driving the growth of this highly under-penetrated segment (9 percent penetration against the global average of 70 percent) that was once inhibited by the high price point.
The Indian market for washing machines in 2015-16 was 5.5 million units, valued at Rs.7500 crore. The fully automatic segment has a handful of players, most of the other makers finding it more convenient to focus on the semi-automatic category.
LG continues to hold an appreciable market share. Samsung, Videocon group, and Whirlpool are in the vicinity of a 13–15 percent market share each, although Videocon has had greater success in the semi-automatic category. Godrej and IFB are strong contenders for the next position, with IFB restricting itself to the fully automatic segment.
The other brands comprising Panasonic, Haier, Onida, Daenyx, Empire, Maharaja, and T-Series are aggressive. Bosch and Siemens are gradually gaining market share in the fully automatic segment. Lloyd and Weston too have some regional presence.
Dixon and Noble are the two major OEM suppliers, which are expanding their business and commanding a double-digit share.
India remains an underpenetrated market, with sub-par levels as compared to the global average. Local consumption and market penetration needs to be driven through primary sales (first-time purchase) as compared to secondary (replacement) sales, which is predominant in the urban markets. And reduction in the total cost of ownership remains key to growth.
Since majority of the local production is centered around top-loading semi-automatic units, front-loading machines are mainly imported. Exports to SAARC and SE Asian countries have lately picked up, consisting of top-loaders and semi-automatic units.
The home appliances industry has witnessed a revival of demand in 2015, primarily supported by urban demand, against the backdrop of a dynamic atmosphere nurtured by multiple factors including rising disposable income, easy consumer finance, and growing e-commerce platforms. There was an overall optimism in the market sentiment on account of positive macro-economic trends like arrest of inflation, falling interest rates, and funding support from banks.
The industry is expectant that the Seventh Pay Commission, which proposed a 23.55 percent increase in remunerations for 4.7 million government employees and 5.2 million pensioners, will encourage sales in 2016-17, perhaps mainly in the urban markets.
Multinational companies are evaluating on India as a manufacturing hub and planning investing in setting up new units or expansion of existing manufacturing plants across the country.
Modern retailers continue to innovate and experiment to remain competitive. They actively collaborate with industry players to offer great consumer experience at the shop floor through attractive value add-ons such as free installation, equated monthly installments, warranty, and other bundled offers.
The rising share of organized retail and e-commerce has increased accessibility of home appliances and, therefore, facilitated increased demand, which is expected to continue growing on the back of expanding base of middle class and affluent consumers, increasing working population, and improving consumer lifestyle.
New and interesting products and concepts continue to become popular in India. There is now no dearth of products in the market. Although the discerning customer opts for the fully automatic machine, manufacturers are optimistic of the semi-automatic segment too. For instance, Panasonic has recently introduced a new line up of semi-automatic washing machines and by 2018 is looking at increasing its presence in tier II and III cities and capturing a market share of 10 percent in this category.
Consumers have a wide range of options to choose from where each product offers different features and technology, new innovations, and incremental benefits. It is no longer a market with limited products and few features. With such rapid churn out of technological advancements, the replacement cycle has reduced from 9–10 years to 4–5 years in this sector.
Indian consumers constantly seek for new and innovative products and concepts that can improve their lifestyle. Companies this year plan to focus on innovations to meet consumer needs and drive profitability.
Vendors are emphasizing on developing holistic distribution channels to cater to all types of customers. Investments in supply chain management strategies along with enhancement in product assortments have been noted in recent times.
Companies are coming up with advanced, innovative features, which give the user the convenient options with their laundry. Features such as Auto Optimal Wash, Smart Control, Eco-Check, Smart Diagnosis, and Smart Nudges have been incorporated by manufacturers. New innovative machines are equipped with wireless Bluetooth technology and a messaging feature that can receive operational assistance and control settings even when the user is away from home. One of the key factors contributing to such growth is the increasing need for energy-efficient machines.
There is a strong focus on reducing operating noise. Clothing can also be steamed to refresh and smoothen out clothes without putting them through a full wash. There are special programs for very delicate or heavily soiled laundry, spot treatments, and for people with allergies, baby clothing, removing animal hair, and low washing temperatures (15 to 20 degree Celsius/60 to 70 degree Fahrenheit). Thought has even been given to that piece of laundry that always gets forgotten, for and people with particularly large laundry requirements, an additional flap in the washing machine door allows the user to add items to an ongoing wash cycle. Washing machines with two drums or an extra-large capacity of up to 13 kg allow for even bigger loads. Door seals and detergent drawers are antibacterial and ensure high levels of hygiene, while also adding active oxygen.
Modern tumble dryers are characterized by outstanding energy efficiency. Automatic self-cleaning condensers also help to reduce energy consumption. Stability, quiet operation, and capacity have also been improved. Refreshing and airing clothes with steam and fragrance are useful additional functions.
Increasingly smart and intuitive appliances are able to recognize the load type and adjust the use of the right water quantity accordingly, which allows the highest energy saving without damaging performance.
A washing machine with inverter technology has sensors that detect the loading of the washing machine. Based on the load, the electronic circuit determines the optimum speed at which the motor should be run to optimize electricity use. To have variable speeds, washing machines have a VFD or brushless DC motors that allow optimum use of electricity at variable speeds.
The direct drive technology includes lot of moving parts like gears and belts that are used with a conventional motor. This ensures that the energy lost in friction in running a gearbox, and the like, is reduced, thereby saving electricity. Although these motors can be a bit bulkier than conventional motors, their efficiency is higher and they also produce less noise and have a longer life. A machine with direct-drive certainly saves on electricity.
Some manufacturers offer both, inverter as well as direct-drive technology, which provides dual benefit if the load sizes vary. The cost benefit of the latest technologies will depend on consumer usage and the price differential of different models.
The Internet of Things (IoT), the systems and sensors that will make everyday appliances into smart devices, could be worth as much as USD 1.7 trillion by 2020. But for now, companies are looking for simple, s.mart features that can entice consumers to make a purchase.
The concept of controlling and managing home appliances via the Internet and a smart device has been gaining a lot of traction in the last few years. Smart connected washing machines are designed specifically to favor the convenience factor of consumers as they come with a unique remote-location operability option. By downloading the app on a smartphone or tablet and connecting the washing machine through Wi-Fi, the end user can operate the appliance from a remote location. The consumer can seamlessly select the desired wash cycle, monitor the process, and get all the notifications on the smartphone from any location.
In 2015, the smart connected top-load washer segment led the market and accounted for close to 67 percent of the global market share in terms of revenue. Top-load washing machines are faster and have larger capacity drums that are capable of washing bigger loads of laundry in a single cycle. Moreover, users do not have to wait until the end of the wash cycle to add extra laundry. Also, the development and introduction of smart top-loading washers is a boon for consumers struggling with back problems as the user does not have to bend to load the laundry. The development and advent of such products will aid in the growth of this market segment during the next few years. The level of competition is likely to intensify further with an increase in product line extensions, investments in digital marketing and e-commerce, technological innovations, and R&D activities. The winning formula for the design team would perhaps then be a perfect mix of aesthetics, energy efficiency, innovative technologies, and loading capacity.
Based on market research conducted by TV Veopar Journal in August 2016.