Brands line up premium products for second half
- 4 Jul 2019 at 04:00
- WRITER: PITSINEE JITPLEECHEEP
Electrolux Thailand's Ratchata Suttapattanon (left) and Promroj Tunnukij say the brand's sales will stay on course to double-digit growth this year.
With relatively strong spending power among middle- and high-income customers, major appliance brands are aiming to expand into premium products in the second half of the year.
At the same time, all of them are eyeing a green strategy to ride the growing trend of environmental concern among young people.
"With the current economic environment, most people remain cautious about spending," said Ratchata Suttapattanon, general manager of Electrolux Thailand. "But for middle- and high-income earners, their spending power remains intact."
Sales of premium electric appliances have seen double-digit growth over the past few years, while mass electric appliances sold only at single-digit rates or even shrank in some years because of the economic slowdown.
Mr Ratchata said his company will launch AEG, a super premium brand for the built-in product line, in the fourth quarter.
The AEG brand will be simultaneously launched in Thailand, Vietnam, Malaysia and Singapore. Prices for AEG products are about three times those of Electrolux built-in products. AEG aims to capture growing business from high-end condominiums.
"We will also gear towards sustainability by launching products that are 100% made from raw materials which can be recycled,'' Mr Ratchata said.
In addition to the domestic market, Mr Ratchata said the company will put more effort to expand its business in Cambodia, Laos, Myanmar and Mongolia to increase overseas sales to 20% over the next 3-5 years, up from 5-10%.
"We will build our brand awareness, in particularly in Cambodia, where the market is quite big given the entry of many investors from South Korea and China and a boom in apartments and condominiums," Mr Ratchata said.
He expects Electrolux sales will stay on course to double-digit growth this year.
Nipon Wongsaengarunsri, marketing director of LG Electronics Thailand Co, said digital technology and growing middle-income earners in Thailand have spurred demand for premium electrical appliances.
The proportion of TV sets with IoT and AI technology is as high as 80% of the total LG TVs, he said, adding the premium LG home appliance business is expected to contribute 20% of the company's total home appliance sales this year, up from 10% last year.
Mr Nipon said overall TV sales, worth 30 billion baht, will be flat this year.
"I believe that all electric appliance makers will compete on technology and innovation development by bringing IoT and AI to control electrical appliances via smartphones," he said. "This technology will be applied both to TV and home appliance lines this year."
An executive at Thai Samsung Electronics Co who asked not to be named expects the market for smart home products to reach 2.5 billion baht in 2019, up from 645 million baht in 2016.
According to The Mall Group, Thailand's appliance market is expected to be worth 250 billion baht.