AB Electrolux, the largest white goods company in the world, has decided to make Kelvinator its flagship brand in India. The Electrolux brand will be targeted at the premium segment.
The Voltas brand, which is being transferred to the proposed joint venture between Electrolux and Voltas, will be used by the Swedish multinational to target the lower end of the market, in which it has no presence at present.
The company, which owns over 100 brands world-wide, is set to launch high-end refrigerators with capacities of 300 litres and above in October. At present, only washing machines are marketed under the Electrolux brand name in India.
"We have decided to make Kelvinator our dominant brand in India, straddling most of the market segments . Electrolux will be present in the niche and premium segments," Ram S Ramasundar, Electrolux' country head in India told Business Standard.
The strategy is reflected in the company's decision to name the Durand Cup , for which it has become the title sponsor, the Kelvinator Durand Cup. According to Ramasundar, what tilted the balance in the favour of Kelvinator as the choice for the dominant brand is that it has been present in India for a
long time and is well-established. It made more sense to push a well-known brand rather than build up a "brand new brand name".
However, despite being the dominant brand, Kelvinator will be confined mainly to the high-selling middle and middle-high segments of the market, with the niche segment being left to Electrolux.
"For example, 95 per cent of the washing machine market consists of top-loading units. But Electrolux will be in the front-loading segment," says Ramasundar.
According to him, acquisition of the Voltas brand name by the company is geared to corner a share of the low end of the market.
Through the joint venture with Voltas, Electrolux is also getting the Allwyn brand name, regarding which a clear strategy will soon be worked out.
Apart from the round-the-corner joint venture with Voltas, in which Electrolux will hold majority equity, the multinational has three other joint ventures in India.
It holds about 55 per cent equity in Maharaja International, the refrigerator manufacturing company, 74 per cent in Intron Ltd, the washing machine manufacturer, and 40 per cent in Eureka Forbes, which manufactures vacuum cleaners.
According to Ramasundar, Electrolux may continue with the multi-company structure or decide to bring all its ventures under an umbrella company depending on how its businesses evolve in India.
Ramasundar will however be the chief executive officer for all the operations of Maharaja International, Intron and the joint venture with Voltas.
