The Maharaja hunts for new markets

Groupe SEB-owned Maharaja Whiteline puts years of strife and controversy behind, moves out of traditional strongholds in search of new consumers

Two years after French consortium Groupe SEB bought out Indian home appliances maker Maharaja Whiteline, it is setting in motion a strategy to widen the reach of the brand in the country and build a new line of premium brands. Groupe SEB India will soon launch Tefal, a global label that it owns, in the premium category while Maharaja Whiteline will be taken beyond its strongholds in the North into new markets and pushed as a mass market brand across the country.

Groupe SEB India is just coming out of a bitter battle with former owner Harish Kumar who created the brand way back in 1976. It had 55 per cent stake in his company in 2011, but differences and in-fighting, led to the brand's downfall. Finally in 2014, Groupe SEB bought the company for euro 100 million but controversies continued to plague the company over the size and the value of the transaction. Now, having put these matters to rest, the company is hoping to give the brand a much needed boost and carve out a larger slice of the Rs 13,000 crore small home appliances market.

Sticking with the Maharaja

Sunil Wadhwa, CEO of the company, appointed after the French group took over says, "The whole point of buying the company was its brand value."

Maharaja Whiteline, Wadhwa says, had great recognition across markets. So even though the new owners were overhauling everything else, they wanted to keep the name unchanged, signalling to consumers that they were not tampering with the product.

It was also felt that it was important to stay within the brand's domain and consolidate the company's position in the North, its traditional market. Today the company claims that it has managed to retain its old customers and win new ones in North India, Rajasthan, MP and Gujarat where it has grown by 30-50 per cent in each market.

The company is now exploring the South, which accounts for nearly 35 per cent of the appliances market. The region was a weak zone with low penetration and awareness for the brand, but the potential was always high says the company. Maharaja Whiteline's biggest competitor in the South is Preeti, a brand with strong local roots.

The next stop will be Mumbai. The company is also bringing in its premium cooking appliances label, Tefal. It will be priced higher than the Maharaja range of products and also mark the company's entry into the cooking appliances segment in the country, where it has no presence currently, said Wadhwa.

The dealer network

For Groupe SEB, one of the big challenges was keeping its dealer network intact even as internal disputes threatened to rip the company apart. The consortium has 22 branches, 500 distributors and sells through 40,000 outlets across India for Maharaja Whiteline. It also has two exclusive outlets under the franchise model.

The ownership dispute had rattled dealer-distributors and the company says that it has worked hard to gain back their trust. Dealers were worried since the supplies had become erratic and the company had stopped servicing the brand.

The first major challenge was reversing the negatives around the brand. Wadhwa says that they went about setting up a strong team that could work on rebuilding the trust within the community. Wadhwa had spent close to four decades in Usha International (one of the brand's big competitors) and he went about putting in place a team with varied experiences in the appliances market. And a large part of the last two years has been spent reconnecting and reassuring distributors.

Today Groupe SEB India claims that Maharaja Whiteline is the second largest distributed brand in the country, quoting market research agency Francis Kanoi. However no company has a share of more than 10-12 per cent of the deeply fragmented appliances market, the company says.

The company has also ensured a steady stream of model upgrades, design innovations and products to keep the dealer network interested and engaged in the product. It launched 68 models in 2014 and 38 in 2015 and is planning to launch 50 new models in 2016, in various segments.

Taking the brand online

Wadhwa says that Maharaja is the leading brand online in its category, on e-commerce platforms Flipkart and Amazon. Currently 10 per cent of the company's sales revenues originate online, he adds.

By going digital, Wadhwa says that the company has been able to accelerate its growth in the country. In the last two years, the company claims that it grew nearly 90 per cent, unprecedented at a time that the industry has not been doing well. It has also helped the company find younger buyers. From being a brand endorsed by parents or elders in the family, it was repackaged to suit the tastes of the young shoppers online. The brand is communicating to a newer and younger set of consumers through its digital initiatives, packaging and designs says Wadhwa.