France based Thomson TV has re-entered the Indian market after 15 years, through an exclusive licensing agreement with Super Plastronics Pvt Ltd (SPPL). The company is quite optimistic about its second innings, and plans to use smart marketing strategies to enhance its online business in India. With an emphasis on affordable price points for its high-end products, it is aiming to capture a bigger slice of the Indian market over the next five years. In conversation with Potshangbam July from Electronics Bazaar, Avneet Singh Marwah, CEO of SPPL, speaks of how this TV brand is targeting a turnover of ₹ 5 billion in the current financial year.
EB: What has led to Thomson re-entering the Indian market after a long gap?
Thomson was one of the leading CRT TV brands in the 1990s and early 2000s in India.
The Indian market has witnessed a transition from CRT TVs to LED TVs since then. Over time, the pace of this transition has quickened, and there is a substantial increase in the demand for smart LED TVs. The rate of Internet penetration has been steadily growing, along with other factors such as better tech infrastructure, increased disposable incomes and higher aspirations. This growth is even faster in Tier 2 and Tier 3 cities, as well as in rural areas.
Considering these factors, we have re-entered the Indian market as a premium and affordable television brand. In the past one year, we have received a phenomenal response and acceptance from our customers. Today, Thomson TV is one of the top three television brands when it comes to online sales, and we are putting in constant efforts to launch TV models that are top of the rung in quality and technology.
EB: How is Thomson different from other players in the TV space?
Thomson TV enjoys a great deal of brand recall and equity in India as we were a leader in the CRT TV segment. This made our re-entry very smooth. Many segments of our older audience remembered us and with our premium quality and affordably priced products, we were able to reach out to a new audience too. For instance, our newest television set, Thomson Official Android TV, is priced at ₹ 59,999 (for the 165.1cm or 65-inch smart TV). This is one of the most affordable Android TVs in India, at present.
We are constantly striving to improve our after-sales support to match what other global brands in India are offering. We also take our customers’ feedback and improve our products, even providing customised solutions where required.
EB: What have your sales figures been like since your re-entry into the Indian market? And what growth are you expecting in the next one year?
Thomson is targeting around 10 per cent of the television market by 2022; its current market share is 3 per cent. The next five years belong to brands in the affordable category like Thomson TV, which will take over the market from the top three multinationals in this time period.
EB: Why is Thomson focused only on the e-commerce market space? Any reasons for not going offline?
As I mentioned earlier, Indians are becoming increasingly tech oriented. The current rate of digital penetration is more than 17 per cent, while rural areas and smaller towns and cities are witnessing even faster growth. With 627 million people expected to go online by the end of 2019, coupled with a boom in the young population, Thomson is definitely going to remain an e-commerce only brand. The audience is not so conservative any more when it comes to their shopping habits, and reservations with respect to online shopping are being addressed by the online market giants in a meticulous manner. This has led to even the elder age group moving to online shopping.
Another reason we only sell online is because there has been negative growth in the offline space. The major issue when selling offline is the limited wall space available, and the many hidden overheads that add to the expense of displaying products offline. With most of the wall space blocked by leading names, less of it is available for affordable TV brands.
With greater Internet penetration, better accessibility, and with Flipkart as our strategic partner, Thomson TV is able to deliver its products to regions covered by more than 15,000 pin codes in India. This kind of phenomenal reach would not have been possible earlier.
EB: What is your marketing strategy for the next five years?
We are putting in consistent efforts to widen our customer base and direct offline buyers towards online shopping portals like Flipkart. The information about our products and their specifications, which is now available online, is a big hit. Customers are able to grasp this information first hand and decide why a Thomson TV would be the best fit for them.
In order to expand our customer base, we are also targeting first-time buyers, who are new to the Thomson TV brand, its premium quality and affordability. We are constantly running digital campaigns to tap new consumers.
EB: How much revenue do you expect from the Indian market?
India’s smart TV market is extremely lucrative. It is set to reach US$ 20.4 billion by 2024, and is growing at a CAGR of 4.7 per cent, according to a report by Goldstein Research. There is a shift in consumer preferences and aspirations towards a smarter, Internet connected home. Our target is to cross ₹ 5 billion in turnover in the current financial year.
EB: Tell us about the manufacturing facilities and production capacities of Thomson TV.
We have three production facilities in India—one is in Noida, and the other two are in Una (Himachal Pradesh) and Jammu. We are now ready with a second manufacturing unit in Noida that will have a capacity of 30,000 units per month. This will take the company’s total manufacturing capacity to over 60,000 units per month.
EB: Where do you see the smart television market by 2020?
Thomson TV has witnessed a 100 per cent year-on-year growth since its launch in 2018. The Indian smart TV segment currently has a 76-78 per cent market share, and we are positive that this number will go up to 86 per cent. The tech-savvy customer is not only buying online but is also consuming content on OTT (over-the-top) platforms such as Hotstar, Netflix, Amazon, etc. This has increased the demand for TVs that can support popular OTT channels and enable customer preferences to integrate seamlessly.
By 2020, smart and non-smart TVs will have fewer technological differences. The demand will continue to grow rapidly as first time buyers join in, new customer segments are targeted, as Internet accessibility and digital literacy increases, etc. By 2020, the TV industry itself will be exploring newer technologies that will be supported by the IoT.
