Sushil Bandi,
Country Manager - India Subcontinent,
Western Digital
What is the current consumer buying behaviour in India?
In terms of purchase patterns, the single most important development in 2010 has been the preference for utility-based devices that deliver value by offering much more than mere storage. In Tier-I cities, for instance, there is a new-found inclination for external drives that also serve as one-stop connectivity and entertainment solutions for offices and homes. Consumers do not just want to store data; they want to access it on the go.
On the technology front, faster interfaces and improved performance in smaller form factors have been made widely available. Devices and components supporting USB 3.0 and FireWire interfaces have been quickly adopted by consumers. Sales of “green” drives have increased substantially, which indicates that computing requirements in homes have gone up, and users are looking at power-saving options.
What kind of trends do you see in the market in India in the coming days?
Going forward, I expect some amount of market consolidation to take place in the storage peripherals segment in 2011. Newer technologies like Flash that are rapidly gaining popularity among end-users, will make non-innovative legacy storage devices redundant. Consequently, to adjust to a gradually altering ecosystem, vendors will have to focus on innovation in applications, utility, and/or compatibility in their offerings to keep them relevant to a value-conscious audience. Therefore, innovators will lead the market. Further, demand from smaller markets can be expected to stabilize in the next one year. Vendors will have to ensure that they are able to reach out to consumers throughout the length and breadth of the country. As a result, distribution strategies will also be readjusted and vendors are likely to do business with fewer distributors that have a strong network and enhanced focus on the product basket.
The never-ending surge in technologies can be expected to take a new turn in 2011 as convergence and compatibility with an evolved components and hardware ecosystem will create a new generation of storage peripherals and drives. Portable and external drives will boast of faster interfaces and networking capabilities to enhance utility and hasten adoption by end-users. Better interfaces will be introduced for home entertainment and networking devices. In the internal drives category, an upgrade to SATA III or 6Gb/s internal drives is likely to be the most visible trend. Another significant development will be an improved penetration of “green” hard drives in homes. Of course, performance levels of components that are cool, silent and energy-efficient are yet to reach standard levels, but we are almost there. The adoption of larger capacity desktop drives will be more widespread but also influenced largely by other subtle factors: faster interfaces for one, and also by newer technologies such as virtualization, the end-user impact of which is yet to be made and felt.
Comment on the overall market size and your market share?
The Indian storage peripherals and hard drives market has maintained its northward sprint and expanded by another 20-25% in 2010. A significant part of the growth has been contributed by increased consumption in the B & C class cities. Utility-based offerings such as home entertainment devices and entry-level network storage drives have been readily adopted by Indian consumers, indicating a more mature market that is geared up for a slew of new-age peripherals.
As part of our continued efforts to tap the huge potential of the Indian market, we have brought India operations directly under the conveniently located regional headquarters based out of Dubai (UAE) that shows great similarity in terms of the socio-economic behaviour. The move spawned an immediate transformation in our go-to-market strategy and allowed us to introduce a slew of first-of-its-kind offerings within a period of a few months in the Indian market. To establish our leadership in the segment, we have backed up our product innovations with new inroads in the B & C class cities that will contribute significantly to consumption of legacy peripherals and drives in the near future.
What is your product range to cater to this market?
One look at Western Digital's launches this year is a testimony enough of our consistent efforts to innovate with change. So, as new interfaces were becoming more popular, we became the world's first manufacturer to ship an external drive with USB 3.0 interface. Later in the year, WD introduced the My Passport Studio portable drive, featuring a FireWire 800 port intended for faster transfers in case the user is a creative professional or a Mac user. And just recently, the entire Caviar Blue and Caviar Black range of desktop drives has been upgraded to SATA III for compatibility with next-gen components with a 6Gb/s interface. These launches were complemented with the introduction of devices that enable networking and secure remote access such as the My Book Live - an entry-level NAS drive for homes, and the WD Photos remote access application for iPhone, iPod, and Android handheld devices.
What is the partner's role in positioning WD?
Channel plays a crucial role in helping us penetrate further into tier 2/3 cities. They not only are an extension of the company in this market, they are also a part of our brand identity. Hence, it is important for the partners to keep themselves updated on the latest technologies and their functionalities. WD invests considerably in training its partners. This not only helps them in gaining technical expertise but also in using that expertise to sell more. Considering the direction in which the storage peripherals segment is headed, partners will have the opportunity to cater to a much larger consumer base than ever before. Additionally, extended product portfolios will help partners push up volumes by focussing on a consistent vendor, as opposed to best-selling product categories.
Moreover, WD has a unique customer service in India - WD Express, a door-to-door warranty service anywhere in India for end-user, system integrators and resellers. Consumers can access this service online for warranty checks, product replacements and RMA status from anywhere in India.
What are the opportunities for channel partner?
WD's utmost priority is to take care of the profitability of the channel partners. Therefore, their support for our brand is only natural. We constantly strive to offer more value and services to our partners to sell WD products. We are supporting channel partners with “Select WD” programme and other Reseller scheme programmes every quarter.
The channel is well-positioned to reap rich benefits from the evolving go-to-market strategies of the leading vendors. The first benefit manifests itself in consolidation of the channel base, currently being undertaken by vendors as they hit the market with an extended and diversified product portfolio. There is a clear opportunity for partners who step up to cater to the huge demand with a sensitively-priced basket of storage devices for all needs. Congruently, vendors will pref er to work with fewer national distributors, thereby ensuring that partners push the brand and its extensive portfolio. Predictably, this will result in operating at lower margins, but will push volumes up significantly.
The second benefit will yield itself through improved skills-sets and technical know-how. For instance, consider the evolving ecosystem of PC components: it demands a certain amount of awareness on upgradation and compatibility to sell a 3 TB or a SATA III drive to first-time users.
What is the evolution path in the future?
I believe the biggest challenge for a personal storage brand operating in India is to correctly anticipate the consumption pattern of storage technology in the Indian context, and to feel the pulse of the consumers' needs and preferences. This market is very dynamic and intriguing. With changing lifestyles and higher disposable incomes, the storage market in India is witnessing phenomenal growth. If we are able to accurately identify our consumers' behaviour, tap the huge demand and play a role in defining the evolution of storage devices, I would say we have successfully overcome this challenge.
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Vishal Sopory
Executive Director
Global Infonet
Though we see a lot of action around the branded notebook space, a major growth driver, we have also seen a consistent demand from the white-box desktop space. Specific to hard disk drives during the first half of 2010, the entry-level capacity was 160GB+ but during the middle of 2010 the market shifted to 500GB+ capacity. And now 1TB+ has also started picking up volumes. We sell Western Digital's Internal drives, External Drives, Media Players, Laptop Drives and Surveillance Drives.
In addition to basic logistics and credit management, our key role is that of business development, channel management, addition of new channels, market penetration and territory development. In short, we are the complete execution engine for WD.
Margins given by Western Digital are at par with the industry standards. In addition to the basic requirement of top-line and bottom-line, it gives us continued access to the component channel. Working with the technology leader gives us an edge, as the company is continuously introducing first-of-its-kind products in the market. They have perfected the media player segment. Today in India, after-sales support is the key. Price is just not the key driver. In the hard drive market, after-sales service plays a very important role. Since the product gets finally spread in the C & D class cities, the "reach" of effective after-sales support becomes the key. Achievement of this is one of the reasons of Western Digital's success in India.
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Mehul B. Kagalwala
DGM - PC Component Group
Neoteric Informatique
Neoteric is the national distributor for Western Digital's range of External drives as well as the internal HDD range of Mobile and AV Drives. Thus, we are responsible for driving growth both for the partners and vendor in the country by working closely with them.
In technology leadership, WD is No. 1 HDD vendor and leadership comes with innovations and technology. We see WD is always at the forefront in HDD technology and comes out with futuristic products.
Every product sells on its unique selling proposition (USP) and application. The key is identification of the channel and pitching it right. For example, the AV drives from WD are best for people who work on the Audio and Video Contents day in and day out. These drives are developed keeping in mind the requirements. According to us, it is the right product in the right segment with the right pitch which makes it more popular. The current buzz for WD on the consumer side is the WD TV Live Hub and we are currently riding on its success.
As mentioned above that it is not the product that is sold, it is the solution. The key element to this solution is after-sales support and service. WD has understood the same and come up with the new and unique concept of WD Express. It has been designed keeping in mind the ease of the channel as well as the consumer. The support to after-sales is provided by the Authorized Service Centres of WD and in case of any DOA (dead on arrival), it is our service arm F1 Services who takes care of such cases.
