Air conditioners not only help people in having a sound sleep, they also enhance their productivity and employee-engagement rate in the workplaces. The modern India has started accepting this truth, and for millennials, air conditioners are no more a luxury but a need to improve their personal and professional lives. Although not more than 5 percent of India’s households own an air conditioner, a significant number of households are fast to embrace the technology. Now, even the middle-class populace of India is ready to invest in comfort; so the future of air conditioner market in India is full of hot opportunities.
With the changing life-style, increased urbanization, better power supply in Tier-II and Tier-III cities, and rising purchasing power of the masses, the Indian air conditioner market is expected to be around 4 million units, and over 20 companies are competing in the space. Also, the revenue-wise growth of the market is expected to be around 12.2 percent (CAGR) during 2018–2024.
Rising demand in non-metros
Advancement in technology and infrastructure is reducing the gap between metro and non-metro cities and amidst the growing uniformity, people want to improve their lifestyle and air conditioning is the basic demand of this changing lifestyle. Power, which used to be inconsistent due to excessive load shedding in the past, is now quite stable even in Tier-II and Tier-III cities of India. Another major factor behind rising sale of air conditioners in non-metro cities is the availability of less-power-consuming air conditioners in the market. Moreover, with the introduction of Indian Seasonal Energy Efficiency Ratio (ISEER), competition between air conditioner manufacturing companies has turned more intense to meet the new standards. Consequently, air conditioner companies are bringing innovative products to the market and offering extensive range of inverter air conditioners.
Faster adoption of inverter technology
Internet and social media are playing a pivotal role in making consumers aware of the latest cost-effective, energy-efficient, and environment-friendly technologies in the air conditioner market. Smart and educated people do a comprehensive cost-benefit analysis before finalizing a product. They research a lot about all the leading brands to find out which brand suits their needs most. Hence, in the present scenario, inverter air conditioners are becoming more popular among the well-informed people, who are seeing the long-term advantage of inverter air conditioners and are switching to the latest technology. Also, as there is not much gross price difference between fixed-speed air conditioners and inverter air conditioners, the shift in consumer preference is quite obvious. Apart from power saving, the other distinguishing feature of inverter air conditioners is their better performance in high ambient conditions; hence, they perform more efficiently in Indian subcontinent. Also, inverter air conditioners are rather quiet in comparison to fixed-speed air conditioners.
Brand image matters
The modern Indian consumers are not rigid to price; they prefer quality, performance, and features over the price of an air conditioner. Earlier, air conditioner manufacturing companies used to associate India with low-price products. Today, the urban population in India is widely travelled, highly knowledgeable, and abreast with the latest development in technology. The customer is quite aware of the global quality standards and the technologies that international brands are promoting to protect the environment. Many times, people opt for a cheaper air conditioner at the first purchase, but the second purchase onwards they prefer to go for a globally accepted brand with high-quality features and performance. This constant need for a better product is fueling the growth of international air conditioner brands in India.