Blue Star earmarks Rs 40 crore for summer advertising; Virat Kohli to drive sales

With over 40% of ad spends going towards digital and e-commerce, the brand’s VP of marketing breaks down the future growth plans.

Blue Star is all set for the most important season of the year for the company - summer. The 81-year-old heating, ventilation, air conditioning, and commercial refrigeration company has allocated Rs 40 crore of its annual advertising budget (Rs 60 crore) for the season.

During the summer, the brand will largely focus on pushing its newly-launched range of air conditioners. Girish Hingorani, vice president of marketing (cooling and purification appliances) and corporate communications, Blue Star, says the new air conditioners are designed to deliver 100% cooling at even 43°C and work under temperatures as high as 56°C. It possesses other features like turbo cool, powerful air throw up to 45ft, and 6-in-1 convertible cooling.

With Virat Kohli as its brand ambassador, Blue Star is using the ongoing season of the Indian Premier League to reach consumers. Following the launch, it created a set of new commercials with brand ambassador Virat Kohli. “We have been advertising quite heavily during  IPL on Star Sports as well as JioCinema. We are also strong in the e-commerce segment,” he shares.

As per its website, Blue Star boasts an annual revenue of over Rs 7,977 crore. Other major brands in this segment are Voltas, Haier, Daikin, Carrier, Godrej Appliances, Lloyd, LG, and Samsung. According to Statista, the AC market in India is projected to grow annually by 17.29% (CAGR 2024-2028).

Premiumisation and air conditioners

The year 2024 saw ‘smart’ initiatives from brands like Godrej Appliances, Haier, and Lloyd, which launched luxury air conditioners targeting premium audiences.

Godrej Appliances launched the Eon Vogue series, including ACs and refrigerators with a wooden finish, giving them an 'aesthetic' appearance. Haier introduced its latest Vogue series featuring a colorful range of glass door refrigerators. Lloyd introduced the Stylus series with features such as 6-in-1 convertible cooling, WiFi connectivity, and voice-enabled adjustments.

Blue Star has also hopped onto the smart and premium bandwagon. On the smart front, Hingorani states that Blue Star has made progress. It launched a new range of Smart Wi-Fi ACs equipped with a smart app. Through the app, one can control their AC temperatures and switch it on or off from anywhere, even if they are on vacation or sitting in the office.

“People can also use voice commands to switch the AC on or off or set their preferred temperatures. We have also launched AI Pro this year, which is a complex and intuitive algorithm set to various parameters, providing maximum comfort with minimum energy consumption,” he explains.

In the previous fiscal year, the company sold 5,000 Smart Wi-Fi ACs and is planning to sell one lakh ACs in FY25. It recently launched the product on e-commerce platforms Amazon and Flipkart.

Beyond functionality, brands are also prioritising aesthetics as a driver for their premium products. However Hingorani has a different view about the category, He believes that consumers primarily purchase cooling appliances due to the functional need for cooling.

According to him, Blue Star's recently launched range of Heavy Duty ACs is “ideal for extremely hot markets.” He further mentions that the brand will be offering ACs with a wooden finish in due course, but it will not be a game-changer in the market, as consumers still primarily purchase ACs for the functional benefit of cooling.

Celebrity factor

For the Heavy Duty AC, Blue Star has come out with an ad campaign #GarmiKiChhutti featuring its brand ambassador, Virat Kohli. It introduced three films including Garmi Ki Chhutti, Virat Kohli vs Bhayankar Garmi, and The Garmi face-off with Virat Kohli.

Hingorani explains that initially, Blue Star's core target audience for residential ACs was the premium market. The objective behind partnering with Kohli was to attract first-time buyers, as he appeals to all markets and has a huge fan base.

The brand's MD, B Thiagarajan, stated in an interview with Business Standard that the company is noticing demand from first-time buyers, especially in tier-2, 3, and 4 markets. Rural markets have become its growth drivers, with around 65% of its sales originating from such markets, while metros and mini-metros contribute to the remaining sales.

Brands usually seek celebrities to endorse their products. Lloyd has Ranveer Singh and Deepika Padukone, Godrej Appliances has Ayushmann Khurrana, and Voltas has Tamil actor DV Vivek. On the other hand, there is no sign of any celebrities teaming up with Haier, Daikin, and Carrier.

Concerning the effectiveness of celebrities in ads, Hingorani says, “It depends from brand to brand. Many brands do not need an ambassador. We needed one because we had an objective, and we are on the road to achieving it. Virat Kohli is the only celebrity we have worked with.”

Blue Star on q-comm platforms?

In recent years, quick commerce platforms have seen a surge in popularity owing to factors such as the widespread adoption of smartphones, increasing internet penetration, and changing consumer preferences for convenience and instant gratification.

Blue Star's products are always available on digital and e-commerce platforms. Apart from this, it has also tied up with retail enterprises like Croma and Vijay Sales. Hingorani says that the company is open to exploring partnerships with q-commerce platforms but may not be able to offer the entire range of products.

“We have been planning to establish our own network of q-commerce platforms for product delivery through our D2C website. Every channel has a role to play. Some consumers prefer to visit retail stores, browse through the range of appliances, and are willing to wait for a day or two. On the other hand, there are buyers who can only wait for a few minutes or hours. Therefore, we are fully prepared for quick-commerce,” he adds.

The perfect media mix

Aside from the IPL, Hingorani says that Blue Star is also actively advertising on around 7-8 news channels during the 18th General Elections 2024, including Aaj Tak, News18, and Republic TV. “The ads will also be showcased during exit polls and on the day when the final results are announced. Our ads are always present on digital and e-commerce platforms,” he says.

With technology advancing rapidly, it is observed that even consumer durables brands are looking to integrate AI into their appliances to make consumers' lives easier. From a growth perspective, Hingorani aims to achieve around 25% growth this year. He conveys, “We are focussing on AI and Smart Wi-Fi ACs through a Smart app, as these will help us understand consumer patterns.”