Battery makers vying for a bigger slice of the rural market pie

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After Luminous and Eveready, it’s now Okaya. Power backup device companies are also following the lead of consumer electronics and roping in celebrities to gain popularity. Or it can be put the other way—power backup devices such as inverters, UPS systems and batteries are now being considered as consumer durables, hence the need for companies to go in for popularity gimmicks. In May 2010, Luminous had roped in cricketer Sachin Tendulkar as its brand ambassador, and following suit, Okaya Power Ltd has made actor Om Puri its brand ambassador. Recently, Eveready Industries India Ltd, India’s largest marketer of dry cell batteries, signed up actor Akshay Kumar as the face of its brand.

By Srabani Sen

Monday, May 02, 2011: Why the need for a celebrity to endorse a power backup product? Replies Rajesh Gupta, CEO, Okaya, “No doubt, when brands get attached to celebrities, they get more popularity. With Om Puri endorsing Okaya batteries, the company will scale new heights.” With Okaya now focusing on the rural segment, Om Puri’s attachment with the company will help in brand building as the actor is a known face in rural areas—thanks to his latest films. Om Puri will endorse the products through the various marketing campaigns of the company.

Okaya to enter auto segment

Announcing the company’s business plans, Rajesh Gupta says that Okaya, one of the major power backup device companies, has a 12 per cent market share of the organised sector. The battery industry in India is equally divided into the organised and unorganised sector.

Claiming to hold the second position after Exide, Gunjan Johri, business head, Okaya, reports that Okaya Power plans to make a foray into automobile batteries with an investment of Rs 250 crore for 2011-12.

The company plans to launch relevant products in the third quarter of this year. “We have already commissioned the plant at Baddi in Himachal Pradesh and field tests are currently on. We intend to invest Rs 250 crore in this project and another Rs 150 crore investment is in the pipeline,” Rajesh Gupta adds.

Okaya had posted a turnover of Rs 750 crore during 2010-11 and hopes to cross the Rs 1250 crore mark during 2011-12.

A slice of the rural market pie

As the battery market in India is becoming competitive, players in the power backup device field are feeling the need to build their brands through different marketing strategies. Many are trying to cater to the rural market, which is a big chunk of the overall market for power backup devices. Companies are also trying to tap the growing need for better technology at an affordable price, in the rural market. Says Om Puri, “I plan to do cultural activities in rural areas to build a brand image for Okaya.”

Aditya Arora, COO, Base Batteries, recently made the following announcement: “In the next three years, we plan to spend Rs 40 crore annually for building the brand. The basic idea is to increase the visibility of Base Batteries through a campaign that is targeted at the rural and semi-urban masses.”

Market giant Exide Industries also aims for a larger share of the rural market by expanding its dealer network by about 30 per cent, across this segment.

Presently, the battery market in India is worth Rs 100 billion, with the automotive battery segment accounting for over 65 per cent of the overall market value. While SMF valve regulated lead acid (VRLA) batteries have a share of 25-30 per cent, lead acid batteries dominate the market with a 70-75 per cent share. This growth is expected to continue in the future as well, due to the growth in the telecom sector and the government’s focus on infrastructure development and renewable energy.

Electronics Bazaar, South Asia’s No.1 Electronics B2B magazine

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