Refrigeration Appliances in Colombia

PROSPECTS

Energy efficiency is leading concern for consumers

Towards the end of the review period, the Colombia government reduced VAT on both refrigeration appliances and washing machines. The reduction from 19% to 5% covers appliances that fall within the lower price brackets and is part of a concerted effort to reinvigorate sales.

Capacity and design are central concerns

Although energy-saving concerns direct purchasing decisions, industry reports in 2019 show that a very close second consideration is capacity. A newly important factor in consumer decision-making, the interior space and organisational features of refrigeration appliances now carry added value.

Connectivity remains underappreciated by consumers, despite push from premium brands

High levels of customisation continue to drive premium brand growth in 2019, as consumers respond positively to flexible features that increase their options, such as touch-screen controls, noise reduction and different cooling settings. Models such as Samsung’s French Door Family Hub Fridge and LG InstaView Door-in-Door allow consumers to quickly identify what they want without opening the door, keeping produce fresh for longer.

COMPETITIVE LANDSCAPE

Innovation is main focus of big brands

Pricing remains the primary tool used to compete for volume share in refrigeration appliances. Mabe de Colombia SA continues as the leading company in 2019, with a brand portfolio offering products for all income brackets.

Consumer loyalty remains with well-known brands

Private label products do not have a significant presence in refrigeration appliances. Even though retailers and hypermarkets continue to launch lower-priced private label products with just the essential functions, consumers look to the leading brand names when making purchases in this category.

Hypermarkets and electronics and appliance specialist retailers benefit from use of price promotions and wide range of payment methods

Hypermarkets and electronics and appliance specialist together account for over half of all distribution in volume terms. Both channels offer constant price promotions and a range of payment methods, including deferred payments and store credit cards.

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