Most Indians can buy an air-conditioner Or, they can buy a television. Not both in the same season — or so it seems. And, with the temperature having shot close to or past the 40 degrees Celsius mark, folks have picked up ACs, leaving little left over for TVs, despite such obvious attractions as the ICC World Cup.
For the first time, TV sales have not shown the usual spike during a World Cup, following the rise in spending on ACs in April and May amid a heatwave. AC sales grew by a record 18-20% in the last two months, a trend that continued into the first week of June, compared with low business in 2018 and 2017, when sales had dropped.
Despite the tournament being well under way and the Indian team having done well thus far, TV sales have only risen by an incremental 5-8%.
This is a huge slump compared with the usual 80-90% surge, five leading consumer electronics retailers said. That’s despite the increase in the number of World Cup viewers in India. As a result, retailers are saddled with excess inventory.
“Consumer buying power has certainly reduced and it seems people are extremely cautious to spend few thousand rupees after buying an AC in the last two months,” said Avneet Singh Marwah, CEO of Super Plastronics, the maker of online-focussed Thomson and Kodak TV sets.
Much of the industry is mystified by the poor demand. Some say it’s because of too much international cricket, while others are blaming the extended duration of the tournament this year. Still others blame the match timings, which mostly run from 3 pm to 11pm. That means people are watching on their phones during office hours or later on in sports bars. To be sure, the growth slump has put a dampener on consumption but cricket and televisions have always been considered an irresistible combination in India.
Great Eastern Retail director Pulkit Baid said the TV category as a whole has been struggling since last Diwali. “While TV sales has still grown by 20% over May, sales are much lower than June last year, which had FIFA fever,” he said, referring to the soccer 2018 World Cup held in Russia.
Mumbai’s leading chain Kohinoor Electronics’ director Vishal Mewani said sales during the football World Cup were better despite cricket having more broadcast viewers.
Southern India retail chain Girias director Nitesh Giria said it might even be difficult to match last year’s June sales for TVs. “We are at a complete loss why the craze has not happened,” he said.
Chains such as Vijay Sales, Great Eastern and Kohinoor Electronics said the big brands have not done enough promotion this year. They also have a mixed product portfolio with older unsold models mixed in with a newer line-up.
“For instance, in the last two World Cups there were cricketers endorsing brands and more marketing push,” said Nilesh Gupta, director at Vijay Sales, which runs 101 stores.
Retailers said large screens of 55 inches and above are selling, having grown 20-25% this World Cup. However, the 26, 32 and 43 inch televisions, which account for almost 90% of the market, are laggards.
Sony India head of television business Sachin Rai said the company has more than doubled sales of sets with screens of 55 inches and above this World Cup over last year. LG and Samsung did not respond to queries.
The e-commerce channel has also seen subdued sales, brands said. Amazon-exclusive BPL India COO Manmohan Ganesh said the marketplaces did not run any major World Cup promotions this year.
The industry is hopeful of a late surge if the Indian cricket team progresses to the knockout stage.
Since India is likely to proceed further, interest is bound to rise and that may eventually translate into higher TV sales, said Brian Bade, CEO of Reliance Digital, India’s largest electronics retailer.―Business Telegraph