Key retailers give their points of view on “where we’re headed” in coming months and years…
This year more than ever, electronics retailers are seeking ways to hang on to market share, increasing access to their products, while retaining a close relationship with their end customers. We asked some of the top players for their points of view.
Today’s retail landscape is constantly evolving and this is partly being driven by the mobile revolution and changing consumer preferences related to this. According to GfK’s Global Director of Digital Retail, Markus Tuschl, “European consumers are seeking out large-screen smartphones for easier online shopping and the level of demand we’re seeing is now beginning to catch up with China, the leading market for these devices. Shoppers’ behaviours and attitudes are also fluctuating and retailers must understand what’s going on in order to respond and identify gaps in the market. With many opportunities requiring significant investment in technology, this is an important time for retailers. There is a real challenge when it comes to figuring out which areas will have the most impact.”
Hans Carpels, President, Euronics International explains that companies with existing brick & mortar stores are limiting their floor- space in order to optimise the choice of products and their inventory on one hand and channel sales through their online operation of the long tail, adding, “On the other hand, most of them invest in a better customer experience in the store itself, creating more space and a friendlier approach. It is foreseeable that the same trend (enhanced customer experience) will be offered in the online offer as well. Some “pure players” are already going that road.”
Fnac Darty Group Chief Executive Officer Enrique Martinez states that within the model that his group advocates, online sales will continue to grow, hand in hand with physical retail. “The key for retailers will be to create the conditions of a seamless customer experience across every channel. It is a virtuous circle: each time we open a new Fnac or Darty store, we observe that over 50% of the click-and-collect sales in that store are generated by customers that had never bought on fnac.com before.”
Karl Trautmann, member of the management board at ElectronicPartner confirms that regardless of whether stationary retail sector or simple online retailer, the two are moving towards each other and developing omnichannel concepts: “Even for customers, there are no noticeable differentiations and maybe that’s good. Thus, we reach the customer immediately and everywhere, in fact with the same service level. We believe there is an enormous growth potential.”
So, what will the balance between online and bricks & mortar retail be in five years’ time, and what will be the key to sales success? One of the key success factors, states Trautmann, is the rapid or immediate availability of products. “Our existing store network is of great advantage over online-pure-players, as they have to compensate by cost-intensive same day delivery. Here, we are one step ahead, and inspire our customers with an optimum interaction.”
The number one driver of change in retail globally, according to almost 90% of the experts who took part in a 2017 GfK study, is convenience.
“As this is a very general concept, we analysed what it actually means from a retailer’s perspective and how it can be operationalised in the real world,” says Tuschl. “Convenience, followed by the internet and mobile communication (85% and 84% respectively) are considered the main trends which are impacting developments in today’s retail environment.”
However, with these trends being relatively obvious, the GfK research boss says the most important insights come from areas that are expected to increase in relevance in the future. And the same is true for new technologies. “One example in terms of trends is how personalised marketing, which is key to building stronger relationships with consumers and driving long-term sales, will have a greater impact on developments in the future.”
To manage the investments effectively, Tuschl insists that retailers need to keep one eye on understanding how new technologies can help them, and by analysing technological developments in terms of their perceived relevance and the likelihood of them being the focus of future investment by retailers, it’s possible for businesses to pinpoint which technologies to invest in and how to differentiate in a very competitive environment.
Source: GfK Point of Sales Tracking, January to September 2017. If not indicated otherwise, all figures based on 18 countries and on sales value %