Sudip Bhattacharya
Product Group Head – Water Heaters,
Haier Appliances Pvt Ltd.

Deriving Inspiration From Consumers’ Needs

According to the India water heaters market by type, by instant versus storage, by distribution channel, competition forecast, and opportunities, 2013–2023, the water heaters industry is projected to surpass USD 600 million by 2023. One of the other major contributors to the sales and growth of water heaters apart from the climatic conditions is the increase in the number of housing projects across cities and the development in the real estate space.

Additionally, other factors like increasing disposable incomes and evolving lifestyles of consumers directly impact the growth in sales of water heaters.

By the end of 2018, the electrical water heaters industry is expected to grow by 10 percent. However, in the case of solar water heaters, the market is growing substantially and is expected to register a phenomenal growth over the last couple of years, specifically from western and southern parts of the country.

On market trends

Growth in the construction sector and increasing disposable incomes have contributed to a surge in the growth of water heater sales. Electric water heaters are currently very popular amongst consumers; however, there are other trends which are gaining prominence.

Unlike earlier days when a water heater used to be considered as the least priority commodity in a household, the scenario has rapidly changed now as consumers are becoming more aware and conscious about the health and other benefits. People have started looking for technologically advanced products with features like digital temperature indicator and cordless remote controls, to add convenience in their life.

While they look for products that aesthetically complement the modern interior decor of their homes’ lifestyle products, they should also consider the safety features of a product. At Haier, we have always prioritized consumer safety with our patented Shock-Proof technology.

Futuristic technologies like IoT are also gaining prominence in our category in terms of awareness, benefits, and usage. While industry readiness for smart home appliances is gradually picking pace, the infrastructural ecosystem for such appliances needs to be augmented for making them more mainstream.

Haier’s vision is to become a leader in the era of IoT and being the world’s biggest manufacturer of water heaters globally, we have a wide range of IoT-enabled water heaters.

On price trends

The price point of a water heater depends on its tank capacity, technology features, and overall quality. The Haier water heater range is available in the market between a price bracket of `4000 and `25,000 (3–100 liter).

Several factors like family sizes becoming more compact, a surge in the migrant workforce in urban India, and houses with lower ceilings, are driving the sales of small-sized and horizontal water heaters across India. Similarly, larger family sizes or families with kids drive the sales for water heaters with higher tank capacities.

While buying a water heater, users should make safety their utmost priority along with the overall product quality. With our patented Shock Proof technology and superior product quality Haier offers the best-in-class warranty schemes to ensure users’ peace of mind when they bring home a Haier water heater.

On technology trends

At Haier we believe in introducing innovative technologies and energy efficient solutions that are suited to the Indian market.

Shock-proof technology

This is Haier’s patented technology that ensures a risk-free and safe user experience. Designed especially for particular areas in a bathroom having electricity issues such as lack of earth wires, improper wiring connections, and electricity leakage which can result in an accident.

iBPS (intelligent bacteria proof system)

A revolutionary technology that makes the water heat up to 80°C, killing the harmful Legionella bacteria

Tough UMC inner tank

Haier water heaters come with ultra micro coated (UMC) tanks with an added 2 mm extra thick special steel sheet. This unique three-layered tank conforms to the Germany DIN standard for adding more durability.

Incoloy heating element

The Haier water heater range is equipped with Incoloy 800 stainless steel heating element with a high efficiency of 97.9 percent that ensures best performance under high temperature and pressure conditions.

On challenges and opportunities

The challenges and opportunities for the industry as a whole signify that there is tremendous potential for the category to grow. With increasing disposable incomes, the penetration is definitely going to increase. Nowadays water heaters are not restricted to a single bathroom; with kitchen and multiple bathrooms in the house there is scope for the category to further expand. Growing infrastructure in the country is another opportunity for the industry to boost demand.

Frequent electricity outage is one major constraint for higher penetration of electric water heaters. These opportunities and challenges have ensured that manufacturers invest in R&D to come up with consumer-inspired innovative products to address the evolving needs and requirements of the customers.

On industry outlook for 2018

India is one of the largest growing electronics market in the world and according to the Indian Consumer Durables Industry Analysis by IBEF, the consumer durables market in India is expected to reach `3 trillion (USD 46.54 billion) by 2020.

Considering all the market trends and advancements coupled with the increasing demand, the water heaters industry in India is expected to progress in the coming times.

Even though the product is heavily dependent on climatic conditions of a region, many other factors contribute to its growth and are helping the industry evolve with time.

On sales in 2018 and projections for 2019 (volume and value)

We have seen tremendous growth in the water heater category with a boost in our local production at Haier’s state-of-art industrial park in Ranjangaon, Pune that was inaugurated in in November 2017.

The growth trend has been very optimistic across all regions through 2018 and I am confident that we will continue to maintain this growth trajectory in 2019 as well.

On marketing strategies

Haier’s marketing and advertising initiatives are driven strategically to reach the end consumers and connect with them at an interpersonal level. With the evolution in technology and the evolving lifestyle of the Indian consumers, Haier is now emphasizing more on digital media, since consumers have now become more tech-savvy and spend a considerable amount of time online.

Haier’s marketing and advertising strategies are in-line with our brand philosophy of customer-inspired innovation and designed to relentlessly engage with consumers and derive inspiration from their needs to further design innovative products and make their lives easier than before.

For our water heater category, our marketing strategy revolves around conveying the product benefits to the end consumer. To achieve this, we utilize a mix of ATL and BTL promotional tactics to reach our end consumers.

On distribution strategies

To display and demonstrate the diverse range of its products, Haier’s focus has always been to strengthen our distribution network. The major chunk of water heater sales happens through exclusive electrical channels and we have aggressively worked toward strengthening our presence in this channel.

Besides this, we also leverage our widespread white goods/durables channel through direct dealers, retail stores, multi-brand outlets, and more.

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