Move Over Salons...

When bengaluru-based Deepthi Mahishi, 24, was packing her bags to attend a wedding in Rajasthan, she made sure she wouldn’t forget the hair straightener. “It helps me smoothen my hair texture and it is convenient,” she says. Deepthi, who is pursuing a career in research, is one among the millions who contribute to the Rs 1,500-crore electronic personal care market. While Philips India, Panasonic and Braun have always been the conservative choice till now for the consumers, two well established companies such as Pune-based SSK Group (makers of Syska LED Bulbs) and Noida-based home appliances maker Havells India have launched grooming gadgets to cash in on this growing market. And if you go by industry insiders, Philips India, the market leader in the electronic personal grooming market, has not been aggressive in pushing its products, particularly in the past 12-18 months. Ditto with Panasonic and Braun, No. 2 and No. 3, respectively.

The More The Merrier
Sensing the large business opportunity and anticipating less resistance from existing players, SSK Group and Havells have rolled out plans to take on the market leaders. It is no child’s play to challenge the Goliaths. Sure enough, between them, the SSK Group and Havells have a combined turnover in excess of Rs 20,000 crore, many times more than the turnover clocked by Philips, Panasonic or Braun in India. Both companies see themselves among the top three players in next 24-36 months. Rajesh Uttamchandani, Director, SSK Group. “The electronic personal care market has a huge scope as it is no longer specific to women. This category is growing at a healthy pace of 25-30 per cent year-on-year.” The SSK Group, which operates brand Syska in LED and accessories businesses, launched nearly 30 beauty and grooming products for men and women in February. By foraying into personal grooming space, it is extending brand Syska.

Havells India, on the other hand, has a different take on why it decided to enter this category. Its electrical consumer durable business in itself contributes 21-22 per cent to the overall company revenues – around Rs 1,200 crore. “We wanted to support the business by introducing a new product category to further contribute to the growth,” says Saurabh Goel, Executive VP, Havells India.

The company started research over a year-and-half ago. The brief was to look for a product category that will gel well with the brand positioning of Havells, says Goel.

While Syska is launching over 30 SKUs in this category, Havells India has decided to launch 16 SKUs initially. Philips India too has over dozen SKUs. But none of these players manufacture their products locally. While Syska is importing them from South Korea, Havells is co-producing them from exclusive vendors from China, Hong Kong, Indonesia among others and will be available in the price range of Rs 1,000-Rs 7,200. Philips also sources its products from China and Europe. What about the margins then? A.D.A. Ratnam, President (Personal Health) Philips India, says the margins are not that high, a fact conceded by even Havells.

Despite the low margins, companies are chalking out expansion plans. For instance, Uttamchandani says the company will be investing Rs 100 crore for expansion and marketing of its electronic personal care products. It will initially be selling them exclusively on Amazon.in. Havells, on the other hand, will depend on its wide dealer/distributor network apart from selling them via multi-brand retail stores, pharma, online and cosmetics retailers. Syska has already roped in Bollywood celebrities such as Tamanna Bhatia and Sushant Singh Rajput to endorse its products.

Tackling The Market
Competition has always helped the players grow. The question is, how will Philips India respond to the new entrants? “Our position is not to respond to competition but to remain in touch with the loyal customers. We take pride in our products,” says Ratnam. Philips maintains that it will continue to invest in it and stay. “Entry of new players helps in expanding the market. We will continue to introduce new products and innovations at regular intervals. People understand Philips, our products and innovation and the quality for which we stand. We believe in positioning our products, not pushing it,” asserts Ratnam. Philips India has gone the celebrity endorsement route with Varun Dhawan, Alia Bhat and Arjun Kapoor.

Ratnam says that the markets for electronic personal grooming products has moved beyond the metros. “For the smaller markets we have already introduced our affordable product range which is doing well in tier-II and tier-III towns,” he says. “We sell more in some of the northern states and hinterland. We do not believe in offering cheaper products or low quality products. We do not compromise with the quality.”

Dreaming Big
Within days of announcing its foray into the electronic personal grooming segment, Havells acquired the consumer durable business division from Lloyd Electrical and Engineering for Rs 1,600 crore. Lloyd Consumer is engaged in sourcing, assembling, marketing and distribution of consumer durables including air-conditioners, TVs, washing machines and other appliances. The acquisition is expected to more than double the revenues of Havells from the electronic consumer durable business. Anil Rai Gupta, CMD, Havells India, says, “The acquisition is in line with Havells objective of driving domestic expansion and owning a brand and distribution oriented asset.”

Havells aim is to be among the top three players in the next few years, says Goel. “Our products will be able to attract consumers as we have introduced small innovations in our products such as USB charging, customised packaging and pouches for safe storage.” The company, popular for ads with social messages, hasn’t roped in celebrities for the personal care section. “That decision is still under active consideration” says Goel.

With Philips, Panasonic and Braun already entrenched in this space, is there space for more players? “The category is growing fast. And that has attracted new players. But I doubt if there is space for everyone,” says Rajat Wahi, partner and head, (Consumer/Retail), KPMG India.

Still, nobody is giving up, not yet. Philips India, the current market leader, has nearly 40 per cent of the market share. And to beat the market leader, the focus for both Havells and Syska is to reach out to the consumers in the sector. “We go wherever our customers are,” Goel said while announcing the company’s foray into the personal grooming section early this year. This is the sort of aggressive marketing Philips India or Panasonic will have to match to retain their top positions.