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Keeping Pace
Gizmos
are no longer for geeeks. And technology no longer for techies. Across
prodcts and segments, Indians are suddenly in a hurry to live life in
the fast lane, observes India Today's Malini Goyal.
Studying at the country's premier fashion
institute has its own
demands. Professional as well as personal. "When everybody carries
a mobile you have to make an extra effort to stand out," says Garima
Garg, a third year student at the National Institute of Fashion Technology.
To stand out, she has just picked up the "exclusive and not-so-common"
T-68i cellular handset worth Rs 26,000 from Sony Ericsson. For the uninitiated
T-68i is the first MMS-enabled (multimedia messaging service) handset
launched
in the country. Her parents who foot the bill are not complaining.
"In fact they wanted me to pick up the latest."
The world
has changed and so have the Indians. Gizmos are no
longer for geeks. And technology is no longer just for techies. Across
products, across segments, Indians are learning to live
life in the fast lane. They are trying their best to keep pace with changing
technology and upgrading their household gizmos.
While the wealthy lead from the front, being one of the first to embrace
new technology the not-so well off step in as soon
as the prices fall. It shows up in the drastic fall in ownership
period of consumer durables—Just five years ago Indians
changed them in 10-12 years. Today, they do it every 4-5
years. Says Ashish Munjal, an entrepreneur who recently bought a digital
camera: "These (gizmos) are the new show-off things. Spending on
jewellery or such accessories is no longer hot."
Call it the
peer pressure or the pursuit of comfort—the urge
to experience the latest in technology is getting stronger. And the sphere
of influence is increasing—what began with cars and music systems
has now turned into a never-ending chase. Right from TVs, washing machines,
computers, printers, telephones, cameras, camcorders to even mundane things
like watches—the fallout of this technological revolution is all
encompassing.
Today, market
is flooded with different brands, models and their
variants. Ever-changing technology has pushed companies to launch frequent
upgrades—to match up to the competition and keep the buzz around
their brand alive. This has made things difficult for common man. For
example, the consumer electronics industry would have seen over 30 models
of CTVs launched in
the last one year. Samsung India alone pushed 14 models of
CTVs in the market and launched 40 new models across product
categories in the same year. Says Sanjeev Thakur, 32, an executive with
a private sector company: "Before buying a product I spend more than
week just doing research—on the net and in the marketplace—to
understand what fits my requirement and my budget."
It is the
hi-tech gizmos segment which is driving growth for the
consumer durable companies. Flat TVs, which contributed merely 3 per cent
for the industry last year is expected to double to 6 per cent this financial
year. Even cellular handsets, at the present volume base of 6.9 million,
is growing at a compounded growth of 40 per cent annually. "There
is a definite shift happening in the minds of consumers towards latest
technology products. They are willing to buy them at that extra cost,"
says Vinay Bahety, marketing executive, Sony India.
With hi-tech
gizmo giving momentum to their sales, companies are working hard to focus
on this market better. Consumer durable companies do not just advertise
but also educate customers. Today, price is not the only purchase factor,
information and awareness is equally important. That's exactly what companies
are doing - making technology look easy and work simpler. While the brochures,
literature and instructions
that come with the product have become very customer
friendly, the quality and awareness among sales staff at various retail
outlets have gone up significantly. Says Sudesh Jog, vice president of
hi-tech store Agrani Switches: "Geeks know what
to buy. But the first time buyers, close to 50 per cent of our customers,
need a lot of handholding and support." Companies are equipping their
exclusive outlets like Sony World, Samsung Digital Homes with trained
staff to be able to cater to hi-end customers better. Companies like Nokia,
Ericsson, IBM and other such companies send their manager to train staff
on all new products they launch.
On the lines of developed markets like the US, Agrani Switches is setting
retail stores for hi-tech gizmos across the country. The company, which
has already set up 18 stores in 12 cities, is planning to expand it to
64 stores in 23 cities by March 2003. Joining them are a plethora of specialised
magazines like av max (for audio-video freaks), Tele.net, Convergence,
PC Quest to keep consumers abreast with the latest in the market.
Frequent
upgrades is a hassle, but it is a boon too. Ask Satish
Kumar, a software engineer, who just bought a digital camera: "Three
years ago, I thought I could never afford a digicam. With prices crashing,
I have just bought one for Rs 7500." As new technologies make old
ones passe, prices for older models crash. Take for example Nokia 5110—when
it was launched three years ago, its market price was around Rs 6000.
Today, it is available
in the grey market for anything between Rs 500-2000. Sony
Playstation one, which was launched globally in 1995 at around Rs 15,000,
had virtually no market in India due to its high price tag. It was only
after the launch of PSII that the PS-I prices crashed to around Rs 7900
last year and Sony India saw a big market here. These are not isolated
examples—this applies to all hi-tech products across categories.
Says Jog of Agrani Switches: "There's a fashion cost. In handset
business we have seen that prices crash by 30-40 per cent in six months
after the launch."
While smart
customers play the waiting game to acquire gizmos
they want, even companies are getting smarter. To push volume sales of
hi-tech gizmos, they are launching latest technology in lower capacity
or sizes. For example, three years ago, flat
screen TV was only available in high-end segment with 29' inch screen
in the price band of Rs 57,000-60,000. Today, most big brands have flat
TV in 15'' inch screen segment with prices as low as Rs 14,000. Ditto
for digital cameras—from extremely sophisticated digicams with zoom
and high resolution meant for professionals (available at Rs 20,000 plus)
to now when companies are also selling digicams for amateurs in the price
band of Rs 7500-Rs 10,000 .
Financing
companies have joined in to make things easier for
aspiring customers. Attractive financing schemes are available
for almost every consumer product thus bringing down the entry barrier.
Agrees Pradeep Nagar, an interior designer, who had
gone to buy a CTV. He ended up buying a 21" flat-screen Plano TV,
far beyond his budget, just because finance scheme was available. "With
the same budget, I bought a better TV with the
comfort of paying back slowly," says he. Nagar is not alone.
Today, eight out of ten consumer goods in the country are being sold on
finance schemes. And seven out of ten cars are being sold on loan. Banks
have lent close to Rs 55,000 crore to consumers in 2001-02.
But some
of the hype behind these hi-tech gadgets may just be
that. Often companies push products and consumers buy them just to keep
ahead in the show-off game. Take for example, MMS-enabled T-68i handsets
about which companies and customers are raving about. The craze is despite
the fact
that not a single cellular operator in the country are supporting
it yet. Similarly, for WAP (wireless application protocol) phones - which
were a rage sometime ago. But there's not enough
content to be able to use it optimally. Says Hari Shanker, 45, a senior
executive with a consultancy multinational, who is a gizmos freak and
is soon planning to buy a music system worth Rs 1 lakh: "People pick
up products for technology. But how
many of them actually use it."
They may not. And that may not be important for most. What is—is
the fact that they are making a statement with their prized possessions..
For the consumers that's what matters. And for the companies that's the
only thing that will matter.
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