MARKETING: Gaurang Pandya - Head of Carrier India Our aim is to have at least 70% localised products.

Interview: 

As MD of Carrier India, Gaurang Pandya has unceasingly focused on embedding value propositions into his firm’s product offerings. But with sales of air conditioners dipping and the markets not looking up as expected, there is trepidation in the air on whether their industry will grow or not. Pandya feels strongly that it will, and answers B&E’s queries on his strategies

Gaurang Pandya has been at the helm of Carrier India – the air conditioning arm of United Technologies (UT) for just over an year. And in this short span of time, his sole focus has been to grow the AC business in line with other revenue arms of UT (it also makes Otis elevators and offers fire safety and electronic security solutions under UTC Fire and Security). “The idea is to grow the commerical AC market in tandem with the growth in the infrastructure and real estate sectors,” he says. Carrier ACs contribute roughly one-fourth of UT’s global revenue of over $52 billion (it’s a Fortune 500 company). In an exclusive interview with onkar pandey, Pandya, shares his company’s future plans and growth strategies, especially in the B2B segment.

Q: AC sales have been adversely affected this season. How did the last fiscal pan out for you? What are your expectations from this fiscal year?
Gaurang Pandya (GP): The year 2010-11 was good for us in terms of overall business, and we see continued opportunity to grow. In the B2B segment, which is 30% of the overall AC market (roughly over $2 billion) we are the leader, and are confident of strongly growing in this segment, as AC penetration in India is still low at 3% as against more than 40% in a market like China. Currently 65% of our revenue comes from B2B.

Q: Manufacturers are increasingly turning global to meet the specific needs of markets. How are you planning to improve your ranking and market share in the Indian market? How have you been keeping score in this regard?
GP: By tapping into Carrier’s rich global resources, cutting-edge technologies and local market knowledge, we have been bringing to India the latest products and technologies focusing on ozone protection, energy efficiency, and indoor air quality features. We tailor our products to meet the increasingly diverse needs of our customers. With our residential products – Window ACs & Hi Walls – we were one of the first to have star-labeled products, and in 2010, 100% of our residential products produced at Carrier India’s manufacturing facility were labeled as per the BEE (Bureau of Energy Efficiency) standards. Not only do our products meet local energy efficiency standards, our Gurgaon factory considers the impact to the environment with our methods of production, and has achieved a reduction of 57% in air emissions, 50% in energy consumption and 54% in water consumption since 2006. We have made significant investment in our Gurgaon plant to maximise localisation. Our aim is to have at least 70% localised products.

Q: Manufacturing environment-friendly and energy-efficient products comes at a cost. How do you keep your sales ticking in a cost-conscious market like India?
GP: Carrier India’s domestic marketing strategy is based on the company’s global strategy of innovation and environmental sustainability. Carrier’s wide range of products (both for commerical and consumer needs) that include chillers, VRF, ducted units, cassettes, window and hi-wall ACs as well as commercial refrigeration and food transport equipment, have helped us expand our footprint in India. Our TG is high-end consumers, for whom the overall value of ownership plays a key role in the purchasing decision. For the commerical business we take part and promote industry events and trade fairs.

Q: Are there any new brands and value propositions you are looking to offer?
GP: We have introduced our new product line of energy-efficient ACs here, including the X-Power Gold Inverter hi-wall, Durakool Star Premium hi-wall, and Estrella range. We also retail the Toshiba brand of ACs in India. In the B2B segment we have introduced, SMMi Acs and AquaThrust 30XA chillers. Carrier Corp. has incorporated sustainability within its brand identity, which combines the elements of a stylised green leaf with the existing “turn to the experts” tag line, which showcases our incessant focus on the environment and sustainability issues.

Q: You have seen dramatic innovations in colour & design of room ACs like SMS-ACs, low-energy consumer ACs, dust-and-worm-resistant ACs. Are these innovations helping AC sales? Also, how is innovation being carried out at Carrier?
GP: We have introduced many innovations of our own too. Besides, we believe in offering sustained value to customers through better cost of ownership rather than on just the initial cost of products. The focus is to proactively understand customers’ needs and create products and services that deliver value and make life comfortable. Carrier invests in products, people and technology, to meet customers’ expectations. Our global platforms allow us to bring the latest technology to India. Further, Carrier’s Lead Design Centers in Europe, China and other parts of the world assist India’s operations.

Q: Now that incomes are rising in tier-2-and-3 cities, are you targeting customers in these places as well?
GP: Business opportunities are growing in non-metros. However, growth has also received impetus from the low penetration rate of air-conditioners in the growing middle class urban India as well as high-growth commercial segments like airports, hotels, and other areas like health care and IT companies. With the emergence of the modern retail segment, commercial refrigeration and transportation are also being received well. Carrier India has more than 600 sales and service dealers, and 1,200 distributors and retailers throughout the country, mostly in the metros and mini metros. There are also a fair number of dealers in smaller locations. Besides, we have good relationships with most organised retail chains.

Q: Unlike some of your competitors like LG, Panasonic in the B2C space, Carrier doesn’t have a brand ambassador. What is the reason?
GP: Carrier’s pre-sale, sale and post sale processes are an integral part of our relationship with our customers. We believe that customer loyalty and brand strength only comes from products that deliver on their promises. Our BEE-labeled products offer consumers savings by reducing their power bills. We believe having a good quality product that meets customer needs is the best advertisement. Our innovative and sustainable products are our brand ambassadors. However, we do have Sachin Tendulkar as the brand ambassador for the Toshiba brand of air-conditioners.

Q: Since B2B is the most critical part of your business, what is going to be your strategy to build this further?
GP: We are one of the leaders in the B2B segment and specialise in large-scale air conditioning projects. We have a track record of implementing these projects successfully. Some of our key projects that we have handled include: Terminal 3 of Indira Gandhi International Airport, Delhi; ITC Royal Gardenia, Bangalore, which has been awarded the Leadership award in Energy and Environmental Design (LEED) Platinum Rating by the Indian Green Building Council, making it the world’s largest and Asia’s first LEED Platinum Rated Green Hotel; EMAAR – MGF Commonwealth Games Village; Bombay Stock Exchange, and many others. We also create platforms to interact with new clients to communicate Carrier’s strong commitment to providing sustainable building offerings. Venues include seminars, industry exhibitions, one-on-one interactions, demo meets, etc., throughout the year.


(One of my Interviews taken for Business &Economy magazine in 2011)