Offline vs Online: Appliance brands change models to ease discount war

Kolkata: The next time you buy a refrigerator or television online, it might not be the same as the one in a local store. Consumer electronics and appliances makers are increasingly selling different versions online as they seek to resolve more than a decade-long conflict with store owners over deep e-commerce discounting.

LG Electronics India, the market leader, offers additional one-two years of warranty on televisions sold through stores, compared with a one-year warranty for online purchases. It also varies features by sales channel for certain appliances.

Also Read: Scorching summer puts ACs in the driver's seat for Q1 consumer durables sales


Haier India, the third-largest manufacturer in the country, offers premium refrigerators with water dispensers online, while offline models feature glass doors or mirror finishes.

Online models include three-door refrigerators, compared with four-door models in stores. Its televisions come with an extra year of warranty when bought at a physical store.

"While e-commerce is the fastest way to reach consumers, we have a huge dealer network of over 35,000 stores. Both can co-exist with different models with different features or warranties," said LG Electronics India director Sanjay Chitkara.

Haier India chief executive Satish NS said the strategy helps prevent channel conflict, although it entails additional research and development costs.

The shift comes as online sales continue to gain share. E-commerce now accounts for 40-45% of television and microwave oven sales and up to 22% for appliances such as air-conditioners and washing-machines, industry estimates show.

Godrej Appliances sells models with different capacities through the two channels, including 500-litre refrigerators and 7-kg washing machines online versus 600-litre refrigerators and 8-kg washing machines in stores. It also varies energy ratings across channels.

Also Read: Indian AC makers eye Europe as record heatwaves spark export opportunity

"Channel conflict has now greatly reduced," said Kamal Nandi, business head (appliances) at Godrej Enterprises Group. Online sales now account for about 18% of industry AC sales, 22% of washing machine sales and 15-16% of refrigerator sales, he said.

Hisense uses plastic lids on washing machines sold online, compared with glass lids for offline models. Its offline air-conditioners also offer better filtration and Wi-Fi connectivity. "The online buyer is a value seeker, while those buying offline tend to buy higher priced models," said Hisense India chief executive Pankaj Rana.