Before Coway, the existing water purifier companies in Malaysia were selling the machines outright, rather than offering them at low-cost monthly leases.
“The fact that we brought our Korean rental scheme here was important,” Choi Ki-ryong, the managing director of Coway in Malaysia, told The Korea Herald during an interview at the company’s Kuala Lumpur office. “The rental scheme made water purifiers much more accessible to the consumers here.”
|Choi Ki-ryong, managing director of Coway Malaysia (Coway)|
“We’ve always been growing since we first entered the market here, selling about 5,000 units monthly when I took up my post in 2014,” Choi said. “The growth accelerated to about 22,000 units monthly in the past six months. The past two or three years has seen Malaysia’s per capita gross domestic product rise to over $10,000, creating a larger population that is interested in and can afford more types of appliances.”
Now, Coway is the top water purifier company in the country with a comfortable lead ahead of its rivals. The Malaysian corporation brings in 80 percent of Coway’s revenues from its four overseas branches in Malaysia, Thailand, the US and China. Last year, sales in the country reached 143 billion won ($128 million).
According to Choi, roughly 90 percent of all sales are made through rentals rather than outright purchases.
In addition to the rental scheme for its appliances, Coway credits its success in Malaysia to its in-home servicing system. All consumers receive bimonthly visits from a Coway representative, who checks the operation of their purifiers, cleans out filters and receives feedback about customer experience.
Currently, Coway has about 6,000 locals working for the company to make these visits. They include roughly 2,000 “Codys,” or Coway Ladies, who provide maintenance services, and 4,000 Health Planners, who make both maintenance and sales calls.
According to Choi, it was not easy at first to introduce the house calls in Malaysia.
“There was definitely some pushback at first to having customer service representatives visit homes, but after experiencing the service, our consumers appreciated the convenience,” Choi said.
This year, Coway hopes to increase its sales to 300,000 units. Choi was optimistic about reaching the goal, as sales in Malaysia grew 48.5 percent on-year in the first quarter alone.
Although Malaysia is still a “growing market,” Choi said that Coway’s experience there could serve as a stepping stone to other successful market entries in countries such as Thailand, where Coway is already incorporated, Indonesia and Vietnam -- all countries where the per capita GDP is rising.
“With more income, consumers will have more interest in having appliances at home that can increase their quality of living,” Choi said. “We hope to see that growth soon.”
By Won Ho-jung (firstname.lastname@example.org)