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A New Entrant in the Air Conditioning Market [analysis](AllAfrica Via Acquire Media NewsEdge) Raheem Akingbolu writes that the Nigeria air conditioning market, which is currently dominated by Panasonic and Samsung, may witness a new dawn with the decision of Japan's leading air conditioning brand, Darkin, to explore the market. The Nigerian electronic market has continued to soar in the last few years, especially since 1999, when the country started experiencing civil rule, which liberalised the business community, thereby encouraging more investors. Though the poor power supply still remains a big challenge to the industry, the deregulation of the telecommunication sector and other factors have boosted the profile of the electronic sector as manufacturers of mobile telephoning devices have since realised the potential of the Nigerian market. This explained why some old brands that had almost gone into extinction in the market suddenly reappeared, while many new ones also found their ways into the market. Today, the players are all jostling for substantial shares of the market. However, each of the brands has strength in different areas. For instance, while Samsung and LG seem to be leading in the distribution of flat screen televisions, Panasonic maintains a convenient lead in air-conditioning. For a brand like LG, its foray into air-conditioning in the market has almost turned a misadventure as the name 'LG' only exists in recall as far as promoters of AC are concerned in the market. New entrant In what looked like a strategy to puncture the leadership of the existing players, Panaserv Nigeria has collaborated with Daikin, a global leader in HVAC, to explore Nigerian market. Though this is not the first time the brand name will be coming into the market, it is the first attempt to operate in the household segment. All along, Daikin has associated with the industrial sector and big corporations to generate cool atmosphere. To hasten its penetration of the market, Daikin Middle East & Africa along with Panaserv Nigeria have unveiled a new range of split air conditioners with Built-In Protection for household use in Nigeria. The global company this week joined hands with Panaserv Limited, its distribution partner for light residential air conditioning products and official sales and service agents for Daikin air conditioner products in Nigeria, to host the 2014 edition of Panaserv model product launch ceremony in Lagos. In a joint statement issued at the end of the launch, it was stated that Panaserv Nigeria shall promote lighter residential air conditioners in Nigeria market catering to the dealers, department stores, wholesale markets and retailers. Giving the background of the brand, the statement stated: "Daikin Industries Limited was founded in Japan on the 25th October, 1924. Since then, Daikin has firmly established itself as the worldwide No.1 provider of total comfort solutions. Supported by a tradition of innovation, quality and energy efficiency, the company offers a complete range of air conditioners for residential, commercial and industrial use. Daikin's experience in the production of air conditioning equipment, compressors and refrigerants allowed them to establish themselves as the leader in the manufacturing and the evolution of these products. Daikin is keenly aware of its responsibility to the environment and is firmly committed to providing homes, businesses and industry with the most efficient and safest products to meet their cooling and heating needs, today and in the future." It was stated at the ceremony that the various products were developed in order to meet Africa's most challenging needs for the best air conditioning. The statement quoted the President of the company, Mr. Hiroshi Fujioka, as saying that the air conditioners have abundant features of which are specially made for Africa weather. He said: "Among other features, the products have; built - in protection against power supply fluctuations and blackout. As standard, the equipment is protected against over current, over voltage and under voltage. For energy saving, what we are bringing into the table offers efficient operation on its equipment for a lower electricity consumption. Of course, it also has special mode that prevent generation of mould and odours inside the indoor unit." Other features mentioned by the president are; quite operation, which makes the brand's indoor units extremely quiet, a rapid cooling for the room and increased comfort at night for a perfect rest. On High indoor air quality, fujioka said it has Cleaner and purified living environment because of the combination of air filters that eliminate various airborne dust and the Mould-Proof operation. Above all, he pointed out that it has high durability under extreme weather conditions. The company has however unveiled three products in the commercial or residential sector, which include FTV model (non inverter technology) with R22 gas, FTVY model (non inverter technology) with R410A gas and FTX model (inverter technology) with R410A gas. As it is, its Unique Selling Points (USP), could be narrowed down to three main features which are present as standards for Africa; Automatic voltage stabilizer (AVS) with a range from 198 - 264V, super quiet operation (less than a whisper) at 30dba and super tropics compressor that was said to deliver super cooling even at 55 degrees centigrade. Brand promise The likely factors that could help the brand to grow in the market include its patronising statement that -Africa deserves the best; the mission statement; and Daikin's decision to ride on Panerserv distribution networks to reach Nigerian consumers. Success stories of most successful brands have been tied to their promises. It is believed that if a company stands by its promise, tendencies are that it would excel in the market, but if it fails to fulfill the promise, then the reverse will be the case. Now that Daikin has stated its mission in Nigeria, consumers are expecting the best of products and services. Again, with Panerserv as a willing partner, the company must have surmounted the challenge of distribution. As a new entrant, one would expect it to face a big task reaching its target consumers, but if it explores the distribution network of Panerserv, then the problem would have been half solved, if not hundred per cent solved. This is so because Panerserve has been around for a while and understands the market in and out. Challenges ahead As a new entrant, promoters of Daikin will have to contend with strong competitions, especially Panasonic and Samsung that have warmed themselves into the heart of consumers. Aside from understanding the market, many consumers have become so committed to these brands that a new entrant will find it extremely difficult to win their hearts. To do so, handlers of Daikin are expected to up the ante in the area of innovation and services. Observers also see the need for them to understand the market and be ready to respond to consumers' needs. Meanwhile, the company has said it is not intimidated by the presence of the existing players. It's Head of Sales for Africa, Mr. Mohamed Miraj Mohamed Abbas, told THISDAY that the company sees competition as a positive development that most times benefits consumers. He said: "Competition is good for us and we are not in anyway intimidated. Having operated successfully in other African markets, we see Nigeria as another potential market where our star will shine, where consumers will experience the best through our products and where we will at the end make a clear difference. To archive this, we will continue to invest in innovation and marketing," The brand at a glance Daikon Industries, Ltd. is a global leader in commercial and industrial air conditioning, with 90 years' experience in manufacturing of air- conditioner for industrial, commercial and residential use. It has been in Africa for over 40 years. It recently signed a definitive agreement to acquire Goodman Global Group, Inc. from affiliates of Hellman & Friedman LLC for $3.7 billion. This move would bring together some of the strongest players in the global heating, ventilation and air conditioning (HVAC) marketplace. It is believed that by combining the global, environmental, technological and commercial expertise of the Daikin Group and the logistical, residential and light commercial expertise of Goodman, an opportunity has been created to achieve a level of success in the HVAC marketplace not possible as individual companies. Copyright This Day. Distributed by AllAfrica Global Media (allAfrica.com). |