Aashish Poojari, director of Indian operations for Havwoods, and Dominiek Frees, who is also responsible for international operations at the companyImage: Mexy Xavier
When Havwoods, the biggest wood flooring brand in the UK (in terms of revenue), decided to roll out a pilot launch in Mumbai in April 2017, its local partner sounded a word of “humorous caution” to Dominiek Frees. “India is still living in the stone age,” said Aashish Poojari in a lighter vein. The director of the Indian operations for the company was alluding to how people here strongly prefer stones instead of wood for flooring. Almost three years later, Frees, the export sales director who is also responsible for international operations at Havwoods, reckons that the brand has been strongly pushing to crack the Indian market. “It [wood flooring] has started to work, touch wood,” says Frees, who was in Mumbai in January to roll out the brand across the country.
The biggest among a bunch of lessons learnt from the country, Frees says in an interview with Forbes India
, is that the understanding of foreign brands that India is one single market is flawed. Edited excerpts:Q. Have you cracked the ‘stone versus wood flooring’ dilemma in India?Frees:
Being a tropical country, India has inherently been a stone, tile and ceramic market. While this constitutes over 80 percent of the flooring market, real wood flooring is a paltry 1-2 percent. Imagine the headroom for growth... it’s massive. The fact that Havwoods is fanning out across the country after almost three years of extensive pilot in Mumbai tells you that wood is growing.
The Indian flooring industry has been experiencing an exciting period due to the influx of newer materials, technology and specialised machinery. Project scales, especially with respect to industrial and commercial flooring, have increased dramatically in recent years. Moreover, wooden flooring is now considered a status symbol. As a result, we have seen a significant adoption rate over the last few years.
Ease of installation and relatively lesser-skilled labour required for installation compared to other alternative flooring materials are factors that have favourably impacted the wood and laminate market growth. Several multinational companies have started forming strategic alliances with domestic players to address logistics and transport issues which deterred them from foraying in the India flooring market in the past. The market is mostly run by some organised players but there are many unorganised ones available too. Q. What have been the top learnings from the pilot in Mumbai?Frees:
The biggest learning is that India is not a single market. Forget the country as a whole. Tastes and preferences differ vastly even inside the cities. Take, for instance, Mumbai, where we had a pilot. Our first big learning was that one size doesn’t fit all. As a premium brand, our offerings were catering to a niche. To make it big in India, one needs to cater to a vast population. So we rolled out a budget offering, which has picked up brilliantly. One also needs to come up with different colour options.
The second big learning was that in spite of awareness about wood and its appeal, Indians were still reluctant to go with wooden flooring. And the reason lies as much in lack of awareness about the available options as about making them realise that what was so far being peddled in most of the Indian market as wood was not wood but laminates, vinyl, bamboo flooring or wood-look tiles. While they have their own utilities, they can’t beat natural wood when it comes to flooring. So educating consumers about the differences proved to be a challenge.Poojari:
Another crucial learning is that India is getting aspirational, and for any foreign brand to flourish, it needs to expand to Tier III and beyond. One can’t remain confined to the top cities. The big growth is going to come from smaller cities and towns. And here lies the big opportunity. There are some big international brands but not much has been done in expanding and building the market, which is still largely unorganised.Q. So rising aspirations find reflection in wooden flooring…Poojari:
A powerful trend has been playing out not only in top cities but also smaller towns. Rise in disposable income has whetted the aspirations of Indians, egging a change in consumption pattern toward branded products and an affluent lifestyle. We also saw a strong awareness among people about foreign brands. The consumers are not only educated about brands but also familiar with the pricing. They follow brands that align with their thoughts and lifestyle. Q. What has been the global picture when it comes to the use of wood? Frees:
Let’s first talk about India. The wooden flooring market here is predominantly in the commercial sector, accounting for more than half the consumption. The rest comes from the residential sector. The majority of the demand comes in renovations, and a small contribution from new construction activity. Product sale is mainly driven by a recommendation from architects, installation personnel and contractors. It is expected that the market will more than double in five years with the rise in dominance of Indian companies. We aim to increase the brand’s visibility using innovative marketing techniques and improving distribution network and product visibility.
The global market is a mixed bag and consumption pattern varies. While some European regions—Germany, Austria, France, Poland and Spain—have shown an increase in consumption of parquet wood floor, there has been a slight decline in Italy, Switzerland and Benelux.
The US, in contrast, has seen a rise in wood flooring in hospitals and clinical institutes owing to it being a more hygienic product, with low microbial contamination along with the ability to keep aesthetics intact. Also, workspaces, offices and business centres have now started evolving with reference to design and appeal. In Asia-Pacific, Japan has shown an increase in the use of engineered wood. Q. Would your expansion in India be gradual or aggressive? Frees:
One doesn’t need to rush in. Wood flooring is still niche and it will take years for it to become mass. The process has gathered pace but it will take time. Any attempt to expand at a fast pace would turn to be counter-productive. Once Indians are more comfortable with the options, taste and prices, the wooden flooring will take off. Right now, it’s at the runway. Poojari:
In terms of strategy, apart from having our own flagship stores in Tier I and II cities, we will have local partners in smaller towns and cities such as Kolhapur, Nashik, Nagpur, Pune and Ahmedabad. We would also be creating a lot of awareness regarding maintenance and correct installation. ● This interview was conducted before the Covid-19-triggered lockdown began
(This story appears in the 05 June, 2020 issue of Forbes India. You can buy our tablet version from Magzter.com. To visit our Archives, click here.)