Ditching price wars and tapping into rising middle-class demand, Japanese electronics giants are reclaiming the Indian market by focusing on premium products.
Japanese consumer electronics brands like Sony, Panasonic, and Hitachi are reportedly re-nourishing their Indian operations by shifting their strategies. According to an Economic Times report, they have focused on higher-profit products such as large-screen TVs instead of competing in low-margin entry-level segments.
As these changes come after years of slow growth, with Korean and Chinese competitors gaining market share, the Japanese firms are also avoiding the price wars led by Chinese brands, which had previously impacted their sales.
Panasonic’s consumer division, which includes products like televisions and home appliances, has remarkably recovered. After years of flat or declining sales, it reported a more than 30% growth in the first half of the fiscal year.
The division also broke even after posting a ₹530 million net loss in 2023-24. The company aims to achieve sales of ₹30 billion in the consumer business, a leaping increase from ₹23.38 billion in FY24.
Sony India has also seen improvements. In FY24, it posted its highest net profit in eight years and achieved over 20% growth in sales, reversing a trend of declining sales over the previous six fiscal years. Sony’s sales for FY24 reached ₹76.63 billion, compared to ₹110 billion in 2014-15. The company’s focus has shifted toward premium products, with a reduced emphasis on entry-level models.
Japanese brands have adjusted their market tactics, positioning themselves not on price but on offering a lower total cost of ownership, with features such as low maintenance costs and fewer failures. This approach aligns with the growing demand for premium products in India, driven by the increasing income levels of the middle class.
According to Panasonic India’s Manish Sharma, this shift in strategy is helping brands gain traction in a market that is increasingly favouring premium offerings.
The consumer electronics market in India has become highly competitive, with Chinese brands like Xiaomi, Hisense, and Haier leading price wars. Even Korean giants, such as LG and Samsung, have had to lower prices to stay competitive.
However, Japanese air-conditioner manufacturer Johnson Controls-Hitachi has successfully turned around its performance by exiting the mass segment and increasing prices by 5% in FY24. It reported a 64% year-on-year surge in sales and a net profit of ₹60 million during the first half of the financial year. The brand is poised for further changes, as Bosch has announced plans to acquire Johnson Controls-Hitachi Air Conditioning globally.
Electronics retail chain Great Eastern Retail, which operates around 100 stores, agreed that Japanese brands are now positioning themselves as premium, focusing on value and cost efficiency. The brands have also reduced non-profitable categories to streamline their operations. As a result, the market is shifting toward premium products as consumer income levels rise, particularly among the middle and upper-middle classes.
