With CE China just around the corner, what are the stakes for Sino-European electronics business?
A recent report by Deutsche Welle indicates that Europe will see an increase of €1.7bn in trade with China as a result of the country’s trade war with the US. With CE China – IFA’s annual trade event in China – just around the corner, we asked IFA Director Dirk Koslowski how he sees business going this year in the light of this, and the changing retail scenario in China.
The situation in China is not that different from that of Europe at the moment. We are facing some markets where the industry is struggling in terms of distributing their products – especially branded products – to consumers.
WE AIM TO EMPOWER THE GLOBAL RETAIL TRADE
Europe as an open market is not protected by any specific tariffs, but co-innovation doesn’t stop in Europe. We need the American companies as well as the Chinese companies, if it comes down to microchips or displays. But the consumer has to benefit from co-innovating processes. There will be some new opportunities, because Chinese companies and Chinese consumers used to be very focused on the American market, especially on Silicon Valley and all the co-called IT giants which promoted and created pretty good consumer solutions for them. Today, especially with smart- home appliances, products from Europe are seen as quality-driven.
Do IFA and CE China serve similar purposes?
IFA is the launch pad for new products and innovations for consumers, but it also takes on the role of educating our retail partners in how to upsell quality products.
IFA and CE China are based on the same principles: we aim to empower the global retail trade – our retail partners. Especially in Europe, it comes down to the likes of the MSH Group, Expert or Euronics: mainly bricks-and-mortar stores. And of course, it’s the same story for our international partners like Suning and Gome in China. We would like to give them the chance to present quality products to Chinese consumers in a different way. Our idea of distribution is not just selling products through online channels. We promote the bricks-and-mortar experience – the hands-on experience for consumers, otherwise the upselling process is not possible. In this sense, business is moving away from online distribution up to a point, moving back to bricks and mortar activities again. That’s what Tmall is doing; and that’s what JD.com is looking for in the near future.
Tell us about the move of the CE China show to Guangzhou.
We decided to move to Guangzhou after collaboration with the authorities in Guangzhou – one of the most traditional trade-show cities in China. They have been successfully doing shows there for over 50 years, primarily dedicated to export. The difference with what we are doing is that we are trying to promote an import show of interest to Chinese retailers and consumers. And the timing is right for CE China – just after IFA, which is the perfect time frame for enabling the markets to be ready for the end-of- year season, when more than 40% of the entire year’s sales for electronics will be done. And in China there is also China’s famous shopping holiday, Singles Day [November 11] which is a very big buying time.
Photo: Dirk Koslowski IFA Director