Every year, starting March as mercury levels soar to record high temperatures, air-conditioning brands unleash their communication across media enticing consumers to their brands. Traditionally, summer is the peak season for sales for the industry. However, this year the Covid-19 pandemic has impacted the economy and businesses. Pitch talks to Krishan Sachdev, MD, Carrier Midea Pvt. Ltd., to understand the impact of the lockdown on the air conditioning industry, and how the company is looking to navigate through these tough times.
According to you, what are the most important qualities a leader must display in unprecedented times like the present?
Currently the most important task as a leader is to stay positive and making sure that the positivity spreads across the organization. In the present scenario it’s easy to lose hope. But, such feelings are needed to be kept internal and keep up the positive attitude towards the future. This is a tough time, but things will change, things will improve and we have to be ready for when things improve.
How are you keeping the morale of the employees high? Has the company taken any initiatives for its employees to make work from home a seamless one?
We are doing a lot of things to keep the moral of our employees high and make their work from home seamless. One of the main things that we are focusing is ensuring continuous engagement and dialogue among employees with their teams.
At a time when we’re not going to office and working from home, it becomes important to make sure employees feel involved. Fortunately for us, almost every one of our employees has a laptop. We’re also enabling them with chat room options like Zoom and Hangouts, so they can stay connected with the team.
As a leader, I have a virtual meeting with the leadership team of the company, starting 9:30 every morning. We also ensure each team leader calls their teams, and frequently these calls go on till the end of business hours at 6 o’clock in the evening, where we discuss not just work, but make sure our employees feel safe about their future. I believe continuous engagement is the key to make sure that everyone feels involved and secure.
What this crisis has especially taught us today is the interdependence of businesses and people from all walks of life….
Interdependence is absolutely critical. We have gone back in time to basics. This situation has taught us how everybody is dependent on each other, not just in industry segments, but as human beings as well. Today, the most important people for us are healthcare professionals, journalist, sanitary workers, farmers, telecom sector workers, shopkeepers or the delivery personals. We tend to thank those people today, but for the longest time we took them for granted.
While social media consumption is high, advertisers are shying away from any big campaigns. How are you tackling this present crisis? What steps are you taking to ensure the brand grow stronger despite the challenges?
Our strength is our service capability. We believe we are one of the better air conditioning service providers in the country, if not the best. Currently, we are making sure that our customers don’t feel as if they have been left to drift at this time. Air Conditioning service is unfortunately not one of the essential services. Therefore, as much as we would like to be able to provide service to our customers, we can’t do that right now. It getting hotter and hotter with each passing day, and if at this time somebody’s air conditioner stops working, it could be quite a harrowing time for then, as well as us. Unfortunately, our hands are tied we can’t send anyone to get the air conditioner fixed, and that’s a huge pain point for us and our connection with our customers. We’re trying to communicate with them through various ways that they rest assured, the moment this lockdown is lifted, will be there to make sure that they’re okay.
Currently, our preferred media channels are Media and PR to reach out to our existing customers and build the brand value. But, other than that we are not advertising new products at this time. When the time is right, we are prepared to take that step. Therefore, we are not doing any direct advertising in print or television, or on social media.
Also, we are not experts in the COVID-19 issue. Therefore we are a little wary of giving advice. All of us know that staying indoors and practicing hygiene will work, there nothing new in it.However, if we try to give a specific message which is not validated in some way, it is risky. We are being a little cautious at the same time.
We would love to believe things will open up soon, and hopefully they will. But, we cannot commit a date to our customers because if things don’t open by then, our messaging will be misleading, we’re extremely ethical and legal and don’t want to suggest or give any kind of message that could mislead our consumers
Are you planning any campaigns for the brand after the normality returns?
It depends on the time factor. Because the air conditioning season in India is a very seasonal. Its three months of the year, starting from March to May. By the time lockdown is lifted, more than 50% of the season would have passed. It all depends on you know, when things open up. Online sales are a big part of revenue, but the largest part of the sales comes through offline retail, which are the retail outlets. Unless they open up, and consumers are able to go and buy air conditioners the way they traditionally did there is no point in bringing out a campaign. We just have to wait and see, when the demand returns. If thing does happen in a timely manner, and we see that the consumer’s demand is coming back, we have the stocks to meet their demand. We’ve planned for it. Depending upon the market situation we will do a campaign, if required.
What are your predictions, in terms of revenue generation, for this year?
For ACs, the first half of the year comprises about 75% of the annual sales. So, 75% of sales happen in the first half of financial year, and 35% in the second half. In the past, we have seen just one month accounting for 50% of the annual sale. But, we are still hopeful. If things open up just in time, we might be able to achieve our sale target in one month.
We have seen this happening in the past, in markets hit by natural disaster. A few years ago, there was a cyclone in Tamil Nadu, and immediately after that there was tremendous buying happened. It was a bumper year for Tamil Nadu. Similarly, last year in Orissa, after the cyclone, market bounced back with a huge amount of buying. We’re hopeful that what’s happened with the whole country today, people will come back with renewed vigour and possibly money in their pockets to be able to buy air conditioners. So, if that big buying happens, we don’t see a big issue for the year. But, if that does not happen, we might be in for huge losses.