Rewind 2023: Premium segment grew, while mass stayed flat: Swati Rathi, Godrej Appliances

It’s that time of the year when we review the most significant industry developments as the year draws to a close. Adgully is reviewing the year 2023 for the M&E, advertising, digital, marketing, PR, and communications, along with leading names in the industry as part of our annual Rewind series.

Recapping the year 2023, Swati Rathi, Head of Marketing, Godrej Appliances, speaks at length about the growth witnessed by Godrej in 2023, how flexible payment options is aiding affordability, product upgrades, and impulse purchases, and much more…

Home appliances market in 2023

Recapping the year 2023, Rathi said that this year, the industry has grown by 8% and Godrej Appliances has witnessed around 15% growth over last year. The growth has been seen in the premium segment, while mass has stayed largely stagnant.

She observed, ‘”The major factors driving the growth of the home appliances market are rising disposable income, rising living standards, and the desire for comfort.”

Key trends in home appliances

Heatwave was more intense and prolonged during the summer months this year in several Indian regions, making cooling appliances like ACs a necessity rather than a luxury for many households.

Consumers are increasingly looking for premium appliances with higher capacities, better performance and feature-rich that give more convenience to them. Therefore, higher premium segments across categories are finding more takers while mass stays flat.

High capacities and premium formats like the 670L 4-door refrigerator, side-by-side refrigerators are seeing traction along with convertible refrigerators. In the large-capacity refrigerator category, 9 out of 10 top-selling models are convertible.

In Washing machines – anti-germ, hot wash, and steam wash continue to get traction and are being offered across segments by us.

The market is slowly showing traction for energy-efficient Air conditioners, with 4 and 5-star ACs now accounting for 29% of the industry.

Products with high relevance and unique innovations are seeing acceptance like the Leak-Proof ACs from Godrej with Anti-Leak technology.

Smart IOT-enabled appliances are also seeing inquiries and form a relatively small, but growing sub-segment.

Aesthetics and colours play a key role in decision-making. The latest success story we had was the Godrej Dark Edition refrigerators – which is all about premium-looking refrigerators with very appealing black facias. Glass door refs, glass-top washing machines are also doing well because of their superior aesthetics.

Access to flexible payment options is aiding affordability, product upgrades, and impulse purchases. About 30-40% of appliances sale today are finance-led as urban consumers find it easy to upgrade to higher capacities and better features.

Outlook and expectations for 2024

In 2024, the premium play is expected to continue. The aesthetics of appliances will also play an important role in decision-making and we could see increasing adoption of smart and connected appliances. The heat levels are projected to go higher next year as well, due to which we will continue to witness demand for cooling categories in the coming summer months.

Alongside premium refrigerators, air conditioners and washing machines, deep freezers should continue to do well on account of rising urbanisation, and booming food joints business with eating out and ordering in trends. Furthermore, newer categories like dishwashers will continue to see gradual adoption to save time and efforts in the kitchen.

Energy efficiency is expected to stay relevant and show traction with energy regime-driven changes in cooling categories. Digital, social, and e-commerce are playing a big role in awareness building and driving consumption and will continue to see higher adoption.