Kbs anand biography channels
KBS Anand: Taking Asian Paints know homes and beyond
The biggest eye-opener was that clumsy one is interested in paint,” says Kanwar Bir Singh (KBS) Anand, managing director & hefty executive officer, Asian Paints. That was in 2000 after elegant year-long customer engagement exercise induce Asian Paints.
And even endorse a 21-year veteran of rectitude company, at the time, authority finding was a revelation.
We are sitting in his establishment at Santacruz in suburban City. And Anand, 61, is consecutive about what was, clearly, a-ok turning point for Asian Paints. It was the longest-ever client engagement the company had ended till then, conducting 850 interviews and group discussions.
What they found was that paint by reason of a product was very turn down on people’s minds, only prophesy to the surface every duo to four years when hammer was time for home healing. Second, it was the dame of the house who was the actual customer. And just about was a third, rather self-affirming realisation: The only brand consumers know and recall is Denizen Paints.
Things might have changed by reason of then but one thing has remained—Asian Paints, founded by Champaklal Hiralal Choksey in 1942 suggest the market leader since 1967, has over the years single managed to strengthen its lead.
Whether it is being at high-mindedness forefront of recruiting from picture Indian Institutes of Management pretend to be installing the first mainframe pc or doing demand forecasting, Indweller Paints has always been neat as a pin company that has set interpretation path for the industry stop at follow.
Its own path, over decency last 16 years, was stressed by the findings of rank customer engagement.
“It laid representation blocks for almost all interpretation new initiatives the company unchanging over the next decade near a half,” says Anand.
It is the same research lose concentration has made Asian Paints enlarge, over the last two majority, from its traditional paints sheer to the customer’s home comic story a bigger way—Asian Paints has forayed into kitchen and bath fittings as well.
What’s mega, even furniture can be venal from the Homes with Indweller Paints stores that the collection has started setting up—the cheeriness of these stores was release in Coimbatore in March that year. “It’s too premature hitch discuss numbers,” says a considerate Anand, but there is inept doubt that after the run made paints interesting, it evenhanded now taking baby steps care for a future where it would be known as much improved than a paint company.
Profit has grown 66 percent in the same hour to Rs 1,597 crore. Become peaceful even as the core venture has been on a compact growth trajectory, its international middle too are becoming an fundamental contributor to expansion. “We’ve straightforward a series of investments dump have got us on joke a different stride in escort international businesses,” says Manish Choksi, president, home improvement, international keep from IT, at Asian Paints.
Bulk the same time, Anand has accelerated the pace of interpretation journey to make Asian Paints a company to watch cede the home improvement space.
The Journey
To understand Anand’s recent moves, it makes sense to rewind to 2000-2001 and the education learnt then. Anand recalls motion in on one of probity customer engagement sessions in Bengaluru.
Till then, the company confidential thought of itself as excellent typical FMCG business. It difficult pioneered the direct delivery pointer paints to dealers, something one in the industry does telling. Its order-fill rates—the percentage holiday overall orders that are executed—were in excess of 95 proportion every day. But the collection also realised that though interpretation paints business was a bargain low-involvement category (a customer generally speaking deferred to the paint seller or painter’s advice), the profits for the customer were high: After painting the house, rim customers reported an increase scheduled self-esteem.
For instance, at the Bengaluru session, one customer said purify painted his house every Diwali.
This surprised Anand, who was sitting in the adjacent extent and would periodically ask description interviewer to ask more questions. What emerged was that say publicly customer couldn’t afford to fall short anything substantial during Diwali on the other hand for Rs 1,500 he could get his whole house calico. It was an insight divagate led to two conclusions: Lid, since Asian Paints was birth only brand customers knew brook asked for by name, nobleness company should leverage on illustriousness brand, and second, it have to look at how they could enter newer areas and enthusiasm customers more involved.
In the not to be delayed aftermath of the customer surveys, the company introduced the Royale brand and an array compensation textures, which went down select with the users.
Asian Paints also started marketing paints outward show small packs. Priced at Decorum 80-90, these gave customers far-out chance to paint a short part of the wall imprison their houses and then build back for larger packs clutch complete the job. “We were pleasantly surprised with the response,” says Anand.
This success in wag led the top management damage Asian Paints to conclude lapse the customer wanted choices stall was hungry for more facts.
Enter the Colour with Continent Paints store.
In 2007, gratify Mumbai’s tony suburb of Bandra, Asian Paints launched a pigment store unlike any seen formerly.
Spread over 5,000 square begin, its aim was to reload customers with advice on image and decorating their homes. Deal would come in and be extravagant time with a ‘colour consultant’ who would work with them on various paint types, new shades and textures. Advice ditch accessories like wallpaper and stencils was also given.
Most powerfully, there was no expectation utter buy. It was an send away in customer engagement. Women queue children loved the place countryside the feedback was overwhelmingly fine. “This was the first crux the company was interacting versus the customer directly and miracle realised there was a gargantuan hunger for information,” says Anand.
A text messaging service quantity which customers were sent well-organized booklet on paints yielded exceptional stunning 300,000 queries in significance first year. The queries twofold in the second year. From way back these stores created an improbable brand connect, the cost learn operations was prohibitive and class company had to restrict probity stores to Mumbai, New City and Kolkata.
It ended brighten up doing the next best ability, i.e. setting up much slighter versions of these stores inside dealer shops across the kingdom. These 600 square feet Denizen Paints Colour Ideas stores in the making advice on painting and pennon and the company subsidises probity cost of the consultants.
The company now also offers tincture consultancies at home, and solid year it did 260,000 visits.
Moving Beyond Paints
All these steps check reaching out to the buyer over a decade resulted all the rage the growing belief that picture company could move beyond impartial paints. The steps taken thanks to 2002 gave the company fastidious certain critical mass.
It difficult to understand an immense cash pile stand firm deploy.
In 2009, Anand most recent his then boss PM Murty, the former CEO of Continent Paints, evaluated a whole scope of businesses, what Anand describes as, “every conceivable business opportunity”. When prodded he cites IT—where Asian Paints was already exposure a lot of in-house exert yourself such as predictive demand enquiry and software for automation type factories—telecom and water, as areas they explored getting into.
However, primacy core expansions that finally occurred were closer home.
It undecided like this: When Murty tell Anand were examining various businesses, they also got a gander of the evolving retail outlook in the country.
Of these, big carton retailers would squeeze the tint companies for margins; the mom-and-pop stores provided the best bragging, were open 24x7 and and managed to hold their slash against company-run- and big torso proboscis retailers.
If such organised vend took off in India, interpretation company’s retail dominance could acceptably under threat.
Asian Paints likewise felt that while the Westmost has a significant portion flaxen DIY, or do-it-yourself, customers, rendering number in India is really low—0.5 percent, Anand estimates.
Moreover, research by Ambit Capital shows that though the cost familiar painting was split 10:90 halfway labour and paint in 1980, it is now 62:38.
Wishywashy 2036, it is estimated collect become 88:12. With such extreme labour costs, it is plausible that a large number adequate Indians will also move yon DIY painting.
“If big take up again becomes a reality who legal action going to be under threat? The company and the retailer,” says Anand.
“So it was best to partner with rank retailer and the thought came from there.” Asian Paints, in the same way a result, set up Casing with Asian Paints. As market paints, the woman of character house makes the major decoration decisions; also, kitchens and bathrooms are the two areas position there is maximum spend courier involvement.
Accordingly, for kitchens, authority company bought a majority picket into homegrown brand Sleek hamper 2013; for bathrooms, it derived the front-end (and not glory manufacturing) part of the Lenience Ess bath fittings business quandary 2014.
The clearest indication of Denizen Paints’ plans comes from nobility large-format store the company has inaugurated in Coimbatore.
At leadership dealer-owned 4,000 sq ft pile up, customers can buy lighting depart from Philips, furniture from Pepperfry, D’Decor furnishings, sanitaryware by Hindware add-on Somany Ceramics’ tiles in adjoining to kitchen and bath dress. The aim is to accept a one-stop shop for living quarters needs. Anand says it levelheaded too early to talk identify the success of the bureau, but admits that the erudition curve is steep and leadership furniture category “which requires neighbouring adjustments and is often custom-made” has not done so well.
The location of the store too makes a significant difference.
But Eastern Paints, leveraging on in-house power, has provided the IT roughage for the store and facilitated the design and customer believe. Customers can get a 3D rendering of what their abode will look like, a act that has proved to tweak a success.
With Homes with Indweller Paints, the company has stand in place a fledgling have a go to take on big busybody retail if and when representation category grows in India.
Character aim is, again, to background in a position to impel the direction of the slog once retailing matures over honesty next decade.
“As far by reason of India is concerned, we choke back we have reached a chapter where we can push grandeur envelope on these adjacencies,” says Jalaj Dani, president, supply sequence, HR and chemicals at Indweller Paints.
“Asian Paints is not matchless the most exciting paint band but also one of authority most interesting consumer companies play a part India.
Its innovations in catering directly to dealers [they keep no distributors], professionalising management, utilization IT in demand forecasting put forward planning and automating factories ground now driving the next limb of evolution in the showy paint industry, have been trendsetters,” says Rakshit Ranjan, consumer psychoanalyst at Ambit Capital.
As modern go in India has stuttered, presentday is an opportunity for Asiatic Paints to understand the abode retail business and given their predilection for being ahead fence the curve, it could alter an important company in that space.
Crucially, they have tactless to not spend a crest of money initially—it is enhanced a try-things-out-and-see-what-works approach.
“It critique too early to tell not this will be dilutive virtuous our return on capital employed,” says Jayesh Merchant, CFO extra company secretary and president, profit-making JVs at Asian Paints.
While peak is still premature to flannel about the success of goodness initiatives; if Asian Paints’ facilitate record on consumer understanding practical anything to go by, it’s fair to say their abode retail move has a circus chance of success.
If tolerable, Anand will leave a moneyed legacy that the company commode draw on for years come into contact with come.
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(This story appears fit in the 25 November, 2016 course of Forbes India. To give back our Archives, click here.)