A market that demands value for money

Indian consumers are ready to invest in a product if they get value for money and excellent service. Nicholas Matten, Sales Director (Western Asia) of Hansgrohe, speaks to M. Soundariya Preetha on the changing trends in the Indian bath fittings sector and the challenges in this segment.

Hansgrohe, a German company, entered the Indian market in 1999 with a tie-up with Jaquar for sale of bath fittings.

“Those days, India was not the focus of Western countries as today,” he says. However, the company looked at India as a market with the income of its middle class rising.

The business community has “high ethical values” and it needs more effort to have a national network in India. “People say India is price sensitive. I do not think so. Consumers here are ready to invest if they get value for money and excellent services,” he observes.

In India, the bathroom has become part of a living space. Though consumers invest in bath fittings once in 10 or 12 years, there is high affinity towards brands. People have the money and ideas to go in for new products.

In Europe, the bath and shower are kept separately. In India, the bath and the shower are always together. So, there is no change in the standard bathroom.

But, consumers upgrade the products that they use. The product quality and design demands have changed.

Mr. Matten explains that the global average of per person’s water consumption is 140 litres a day.

Of this, only five litres are for cooking and drinking. The rest is used for washing, cleaning, etc. In places like rural India, the consumption may be lower due to lack of access to water. “We concentrate on the 135 litres.”

With water reuse, this can be brought down. “How to use water more sensibly is what we should see,” he says. This can be done by two main efforts: reuse of water and cut down use of water in the fittings.

The company is coming out with water recycling units and these are likely to be launched in the Indian market in another 12 to 18 months.

Used water from the shower, wash basin and bath tub are cleaned through chemical, mechanical and biological methods and reused in washing machines, dish washer, etc. Our aim is to save water and maximise the pleasure of using these latest facilities, he says.

According to a recent media report, some hospitals in Bangalore are spending more on water than on medication. Thus, if they can be helped in saving water they can spend more on treatment. Products for such purposes are available. But, what needs to be done is to educate the customers on these.

The slowdown and economic crisis now is a blessing in disguise. The problems faced by the construction and hospitality sectors in India are different from that of the U.S. Here, the real estate bubble in some “hot spots” has burst and the demand continues in other parts. India continues to have financial liquidity. What has happened is only a correction in prices that is necessary. In the U.S., there is a huge inventory of unsold homes.

“We are very positive of India.” Unlike the U.S. or some parts of Europe, the Indian economy is expected to recover soon.

Companies that may run into problems are those that have invested heavily in land banks and now face a funds crunch to complete projects.

However, challenges such as these will confront a fast growing economy and all recessions do go away. “In India, we are already seeing signs of recovery,” he says. So, sectors such as bath fittings will continue to have demand.

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