2023-09-11 03:38:33
Akin Garzanli, Beko’s marketing director, spoke with THE OBJECTIVE minutes after the presentation of the company’s new philosophy for its two brands (Beko and Grundig) at IFA 2023, the world consumer electronics fair that this week It was held in Berlin. In the only interview he gave to a Spanish media during the event, he defended his commitment to sustainabilitydespite the fact that it is still not completely profitable, and made an in-depth analysis of the Spanish market where they are working to recover ground after the pandemic and the public impact that their sponsorship of FC Barcelona meant.
Q.- What does “Beko state of mind”, the company’s new slogan presented at this IFA 2023, mean?
A.- “Beko state of mind” is the definition, first of all, of how we see innovation. For us it is not just an extension of a product or something we build in the short term. Consumers are very busy with their lives, with controlling their mobile phones and, therefore, they do not have time to decide which program is best for their washing, how they can save energy or how they can make consumption more efficient. The world is complicated, that’s why “state of mind” is the way we trust our appliances so that they make the most efficient decision that makes your life easier. We want our products to make our lives better with the help of sustainable activities.
Q.- We live in complicated times for the world, for society, but also for companies. What is the situation of the sector after the pandemic?
A.- After the pandemic, the industry has experienced great changes, such as, for example, the increase in logistics costs, the prices of materials and the increase in the energy bill. The general values of these inputs have tripled, but it is impossible to raise the price of our products (washing machines, ovens, dishwashers) by this same percentage. This put great pressure on the industry in terms of profitability. We are now recovering, but we still have a big challenge ahead because energy prices remain high and there have been tensions over gas in Europe.
Akin Garzanli, director de marketing de Beko y Ragıp Balcıoğlu, director comercial, ilante la presentación en IFA 2023. | BEKO
Q.- How did this scenario affect Beko’s commercial and economic progress?
A.-At Beko we are motivated to help consumers in their search for more innovative, quality and sustainable products. This is very important, but we are also increasing our market share not only in Europe, but throughout the world. So, we are improving, we are growing, but it must also be noted that the industry has a great challenge in terms of profitability.
Q.- How has the war in Ukraine impacted you?
A.- The impact is more in terms of consumers with the increase in gas prices that they have had to assume in the last year. This is why our challenge is to focus innovation to transform and help customers find alternative ways of heating. For example, we have increased our sales of electrically powered induction cooktops across Europe by almost 38%. In this way, we believe that changing gas appliances for electricity while promoting the use of other appliance use programs to reduce energy costs can help them with their final bill.
Q.- How to maintain this pace of innovation that you have presented at IFA 2023 considering the low levels of profitability of the industry?
A.- Ten years ago we had few places in the world working in Research and Development (R&D), but now we have a presence in 53 countries and research laboratories in 30 of them. Now, ideas come to us from all over the world, we have around 2,000 ideas to develop in our products per year and a third are related to the sustainability of the planet. Then NOur challenge is not only to choose these ideas because they are sustainable, but also because they can help increase the quality and performance of our appliances.
Q.- How to convince consumers that they should invest in sustainability, despite the fact that these products have a significantly higher cost?
A.- We are against the idea that sustainability should be more expensive. The reports we have tell us that more and more people are willing to pay more for a sustainable product. It is still not the majority, but this percentage is growing. Furthermore, new generations increasingly believe that sustainability should come by default in all the products they buy. Therefore, our challenge is to bring sustainability to the level that is demanded, but not at a high cost. And it is something where we believe that the entire industry is not positioned.
Q.- How can sustainability be made profitable at a time when industry margins are so tight?
A.- Recycling continues to have a higher cost than selling natural products, but we continue to investigate and support it because it helps society and also benefits us in obtaining financing from green institutions. This way, we get some reward for our efforts to make sustainable products with higher production costs. In 2050 we want to have zero emissions, it is ambitious, but we believe it can be achievedFor example, with technologies such as the heat pump that helps reduce the consumption of our washing machines. It is not easy, and sometimes it costs us more, but thanks to a greater volume, production can be bearable.
Q.- Could you tell us about a specific case?
A.- A good example is the use of plastic bottles in the construction of certain parts of our washing machines. Ten years ago it had a much higher cost than now, but we have had to learn how to perfect the process. We have increased the volume and reduced its cost to acceptable levels. What we cannot say is that we are not going to explore these paths and this technology because they have high costs and because we could lose one or two points of profitability. Then no one would do anything.
Q.- Let’s talk about Spain. You are leaders in sales in Europe and first in several countries, but this position is far away in our country…
A.- Spain is a market with great potential that was revealed during the pandemic: we grew a lot because other competitors had problems that we did not. But when the pandemic passed, these companies recovered and we could not maintain this improvement in market share. But this situation helped the Spanish consumer get to know our brand at a time when we launched the sponsorship of FC Barcelona, which gave us great visibility. Spain is a market in which we have high hopes and where consumers are trusting our commitment. Of course there are difficulties, the market is shrinking, but we are confident that we will have a significant recovery for our brands.
Q.- What is your current position in the Spanish market?
A.- We are among the top three in terms of unit sales with the Beko brand. As for the group, also including Grundig, we are also in the top three.
Q.- But are you growing this year?
A.- This year we are flat in terms of market value, but falling in units. In general, the market is falling in terms of units sold by up to 5%, but despite this we maintain third place with the Beko brand. Why doesn’t the value fall? Because consumers are investing in higher value products that are more durable and offer more efficient solutions to reduce the impact on their energy bills. Spaniards buy fewer refrigerators and washing machines, but pay more to make them last.
Q.- What are the products that you sell the most in Spain?
A.- We sell everything, especially we are leaders in dryers and washing machines. We are also trying to lead in sales of washing machines that incorporate our recent innovations. And of course, we try to position ourselves in the highest quality categories where we want to offer all our innovation and our solutions that can contribute to this change that, ultimately, seeks to change consumption in the world.
Q.- Now let’s talk about FC Barcelona. What happened? Why did the sponsorship end?
A.- We have always had an excellent relationship with FC Barcelona, but we reached a point where we decided to stop because the objectives were met. We came to the conclusion that we were no longer interested in the football and sponsorship industry because it was changing direction and the world of gaming began to take over all the visibility. Secondly, sponsorship of FC Barcelona had a significant cost and when you look at your investments in marketing and see what you can do with that money in other areas, you rethink it. In fact, in digital marketing you can have greater contact and much greater interaction and effectiveness in reaching your consumers. The sponsorship of FC Barcelona was very important and for seven years there was a great return on our investment, but not anymore, so we decided to move our resources to other areas.
Q.- Will we be able to see the Beko brand again on any other football team in the future?
A.- It is likely, we talk to everyone and look for ways to collaborate. This fall we spoke with many teams, but not only to put our name on their jerseys but to look for other options. The younger generations have a social purpose and want us to be more sustainable. In the case of football teams we can, for example, explore ways to reduce their water consumption or how to make their recycling systems more efficient. Some teams are really interested in this and if we find the partner suitable we would love to carry out projects of this style.
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