By Sneha Ullal
Focus on cutting-edge, green consumer electronics and lighting, adopting strong digital media campaigns, striving to invent new categories — going by their activities, Philips India Limited is thinking beyond the future, and targeting newer generations. Vivek Sharma, Chief Marketing Officer, Philips India Limited, shares the progress of its core businesses and future plans
Q] What is the brand’s marketing philosophy? What challenges do you see for Philips as a consumer brand as well as a brand for professionals in the healthcare industry, government and corporate sectors?
Philips is in the business of health and wellbeing. We are a diversified technology company, not a mere electronics manufacturer as perceived by many in the past. We have three core businesses: Lighting (for professionals and consumers), Healthcare, and Consumer Lifestyle, which includes domestic appliances and personal-care products. Our marketing approach encompasses B2B, B2C and B2G (business to government) too.
Philips helps improve people’s lives through meaningful innovations. That is brand’s marketing philosophy worldwide as it is in India. In Healthcare, we deliver not only equipment but solutions for government and private hospitals. For instance, we are developing solutions for non-invasive surgery, and also striving to make healthcare and important medical tests more accessible to small towns, with the help of our R&D centre in Bangalore. Philips also provides energy-efficient lighting products. We launched our LED lighting solutions for consumers two years ago, which is doing very well. We are constantly working with state and central government bodies to introduce such lighting across the country, to help make it more energysecure and green.
When it comes to Lifestyle, we want people to lead a healthier, happier life with our products. For example, we recently launched an innovative kitchen product called the Air Fryer, which makes fried foods with 80% less oil. Through our personal-care and grooming products for both men and women, we let them express themselves better, without fearing about hair damage.
Our brand philosophy of improving people’s lives through meaningful innovations comes to life through five aspects: our portfolio, products and services; our one-to-one interactions through our consumer insight programme called ‘Passport’; our communications and advertising; our channels like around 90 Philips Light Lounges across the country; and our employees.
Q] How have your consumer demands evolved over the years? How has your advertising and marketing module changed as a result?
We’ve seen growing trends in digital media, need for one-to-one communication and customization. For our customers and consumers, the interaction with the brand doesn’t stop after purchase but continues via the digital medium and after-sales services. They also want to experience products and solutions before they can buy them. Our marketing strategy has become more digital-savvy over the years. We are active on social media platforms like Facebook and Twitter, and also on e-commerce. For personal-care products, as much as 15 % of sales comes from online purchases. Our website has also been tweaked so that customers can get easy access to product information, dealers and service centres.
To experiences our home decorative lighting products, consumers can walk into any Philips Light Lounge. We’ve also conducted demos of the Air Fryer and hair grooming products in malls and retail outlets. To promote our male grooming products to youngsters digitally, we developed an AR app, through which a consumer can take their profile photograph, and see how various hairstyles and facial stubble styles can be created with our products. We’ve also done DIY YouTube videos on hair grooming and styling.
Q] The economic slowdown has made many Indian brands wary of their marketing spends and the media they’re using as well. Has the slowdown affected Philips too this year?
The slowdown has affected the buying sentiment of consumers, the economic environment is tough, and there is shortage of money for big investments. Having said that, it hasn’t affected us much, because of our diversified business portfolio that caters to B2B and B2C markets. Our high-growth categories right now are our home decorative and LED lighting products, personal care and highend kitchen appliances like Air fryer, food processors and blenders. With Healthcare, there is a slowdown still, but because of the innovative solutions we have for the market, we are getting market share and right now we are the No. 1 healthcare providers in India.
Q] There’s been a lot of buzz and activity around Philips LED, especially with the launch of a new campaign and the appointment of its new ambassadors Ranbir Kapoor and Shruti Hasan. Can you expand on the purpose of this campaign and what you hope to achieve?
As a market leader in India, we have decided to lead the transformation from analogue (bulb, CFL) to digital or LED lighting with consumers. LED has several advantages — it saves 50% more energy than CFL; it offers features like colour changing, dimming etc; it can take various shapes; etc. However, adoption of LED lighting has been low in India, because consumers do not associate it with relevant benefits. Also, people only think about purchasing a new light or bulb right after the older one goes off.
The purpose of the campaign is to make this category more dynamic, and also highlight the endless possibilities of LED lighting. We chose Ranbir and Shruti because they represent the new generation at the forefront of adopting this technology. We also wanted to show how lighting has changed over the years, so we recreated the classic hit Saara Zamana, which had Amitabh Bachchan wearing that light bulb suit, and which was path-breaking for that era. In this ad, Ranbir Kapoor wears a similar suit powered with Philips LED lights. I believe this campaign will strengthen the position of Philips as an innovation leader. It will not only introduce LED lighting to consumers, but reintroduce the brand to the world of lighting.
Q] What is your current market share? Which is the biggest brand in your portfolio and which brand are you betting on going ahead?
As company policy we can’t reveal market share numbers, but we can share our phenomenal growth figures this year. Philips India has delivered double digit comparable growth in gross income in Lighting, Consumer Lifestyle and Healthcare. The gross income this year (ending March 2013) increased by 14.5 % as compared to financial year March 2012, while net profit grew by 35%.
The lighting business saw 59% growth, thanks to the addition of 15 new brand retail stores across India, while the Lifestyle sector continued to focus on strengthening market share in categories like kitchen appliances, garment care and hair-care and grooming, all of which enjoyed a growth of 9%.
The Healthcare business in India grew by 25% this year, primarily driven by a growth of 26% in imaging systems and 27% in patient monitoring.
Q] What does your media mix look like? Which medium utilises a major chunk of your advertising and marketing spends?
A significant portion of our marketing resources is invested on one-to-one interactions with customers and our government stakeholders, through meetings, conferences, symposiums, seminars, etc. and creating offline and online material to enable the interaction.
For B2C, TV and print remain the main media because we are creating new categories like home decorative lighting, hair-care and styling products for women and male grooming products for young men and it is necessary to reach out to a large number of consumers. However, we have observed how many of these categories have been adopted by younger consumers, so we spend about 15 to 20 % of our marketing budgets on digital.
Q] Can you share one or two ‘light bulb’ moments during your tenure at Philips India?
We launched our LED bulbs more than a year ago. I was in Whitefield, Bangalore — an IT hub — for a market visit. At that time, LED bulbs were a lot more expensive than CFL. I went to this one shop and casually asked the shopkeeper how many LED bulbs were sold. He said that 22 bulbs were sold that say and only two were remaining! In fact, one gentleman, a techie, bought eight of them. This insight, that IT guys will be the first to adopt such technology, irrespective of the cost, was an eye-opener for me, and it also re-enforced the thought that we need to target these guys more and more through digital media.
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