As the growth story of luxury carmaker Mercedes Benz India continues, so is the craze for its merchandise, accessories and boutiques, thereby creating an additional profitable revenue stream for the company, said a top company official. This business is generating an annual revenue of about INR 50 crore.
“As a brand, Mercedes Benz has a lot of emotions associated with it. There is a large section of Indian consumers who may not own the car today but have an aspiration to buy it. So they like to own a cap, keychain, perfume or a memento,” Santosh Iyer, MD & CEO, Mercedes Benz India, told ETAuto in a conversation.
One of the largest selling items is the range of perfumes, he said, adding that consumers also buy a lot of these accessories as gift items.
Mercedes Benz, which started online merchandise sales in March 2020, also sells scale models, bags, t-shirts, paperweights, car models, gloves, pens, jackets, earrings, as part of the collection.
Starting young
According to Iyer, Mercedes' non-car business vertical is growing at a “fast” pace, at over 20% year-on-year. However, it is “not just about money”-- it is about connecting with the brand at a young age for them to become Mercedes Benz custodians in the future.
“.. getting the star in the households of the people..to get that kid the small teddy bear of the brand and then connect it in the future.”
Interestingly, during the last 3-4 years the German company’s Indian arm has also witnessed a 50% rise in the average selling price of the car, which has gone up from INR 60 lakh to INR 90 lakh now.
About 40% of the cars are financed by the NBFC arm Mercedes Benz Financial Services. This business is expected to cross INR 10,000 crore-mark this year, Iyer said.
The company recently launched its second locally made electric vehicle, the EQS SUV, in India. It currently sells six EVs and has seen its penetration in its total sales double to 5% in the first half of the ongoing CY24.
The luxury carmaker has also pointed out the need for the government to come up with a platform to democratise charging infrastructure for electric vehicles.
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