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Retra Annual Industry Conference 2012

The same is true of the £3bn UK MDA market of which only 20% goes via independents at this time. In this sector premium features do drive value growth with high capacity washing machine, luxury side-by-side refrigeration, range cookers and induction hobs all adding significant value.

Manufacturing viewpoint In a series of manufacturer presentations the common themes of working together, embracing the internet as a selling tool (in store and online) and concentrating on higher value products prevailed. Sony’s consumer sales director, Chris Bowen understandably opened his presentation by stating he was glad to see the back of the last financial year. Sony had a particularly troubled 12 months trading, culminating in the announcement of 10,000 redundancies worldwide the week before the conference. He noted that the AV and IT markets together fell 7% in volume and 16% in value last year, indicating that the market is reverting to closing the deal on price. “UK consumers have around £320bn of

discretionary spending power yet only 3% of that goes on AV and IT equipment,” said Bowen. “For many consumers the retail experience is confusing, disjointed, and full of conflicting advice. We estimate that £2.2bn of sales are ‘lost’ as customers start the sales journey but fall out and never purchase. We need to work together, minimize confusion among consumers and better exploit the innovation that we as an industry are so good at.” With ever more CE devices connected to the internet and controlled by an iPhone or Android App, Bowen

suggested TV retailers should look to high bandwidth broadband and get customers to interact with Smart TVs for example using their own devices in store. “It is going to be another tough year but exciting things can happen and we must work together.”

The same sentiment echoed

throughout the presentation by Michael Steinle, CEO of BSH Home Appliances. Noting a 4.7% increase in the value of their MDA business in the UK, Steinle commented, "Makers need to talk directly to retailers about marketing and work together. As 80% of people now research a white goods purchase online, the marketing must be across all channels to engage the customer. Let's talk about marketing, not the price." BSH has a selective partner

programme for Bosch, Neff and Siemens retailers designed to support marketing and sell through.

Online marketing Second day of conference, started with the presentation by Graham Loosley of marketing consultants KPI, was a whirlwind of dynamic information regarding improving internet marketing. The two key areas Loosley identified as

areas that retailers should strive to optimise was email marketing and mobile web. "There is huge growth in mobile web traffic and mobile search and next year we predict some 30% of all web traffic will be via a mobile device," said Loosley. "One in three mobile searches are looking for local results and this presents high street retailers with a great opportunity for location-based marketing and web optimisation."

As Google keeps changing its search engine parameters Loosley noted how increasingly complex it is to get and retain a high position in natural search rankings. While link building used to make a big difference to a site's search ranking, today mobile links, video content and links to trending social media is required to get you above your competitors. As the top three results in a Google search get over 60% of the click through traffic, this is a vital element in marketing your store on line.

The small opportunity After the many presentations highlighting the difficulties in the market and small points of bright light in the gloom, Morphy Richard's sales director, Gary Sharp delivered a fabulously informative and up beat look at the opportunities in the small domestic appliance market.

"While volume in the SDA market has shown a slight decline of 2-3% year on year, the value has gone up 8.7% to well over £2bn in the same period," noted Sharp. He highlighted the spectacular growth in high value coffee makers, many now with price points over £500, as well as Morphy's own electronic toaster, DeLongi's Style range, Philips and Tefal's air fryers and Bissell’s Deep Clean floorcare. All of these products are driving up market value and benefit from widespread promotion, often on prime time TV, by the manufacturer. These infomercials are usually available from the manufacturer to be played in store too. In addition to the growing value, the SDA market offers products that catch the eye in window displays, increase footfall in store and are often impulse purchases. ■

The next Retra Annual Industry Conference will take place at the Lancaster Hotel in London, on 22-23 April 2013

BSH’ Michael Steinle

GfK’s Nigel Catlow

Morphy Richard’s Gary Sharp May 2012 The Independent Electrical Retailer 25

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