Leading consumer electronics companies all over the world are rapidly adopting retail strategies in the face of fierce market competition. Big players like China and the United States are fighting it out with strategies for the future.
China’s New Retail
China is likely to see pressure in the short term on the consumer electronics industry, due to the novel COVID outbreak since it has impacted the supply of raw materials and the sale of brick and mortar stores.
These stores have, understandably, witnessed a sharp decline in the number of customers and sales revenue with alarming pressure from operating costs. However, we believe this impact will fade away in some time and this segment will experience a massive rebound once the outbreak ends.
According to Guo Meidi, President of Beijing-based consultancy All View Cloud, the demand for consumer electronics that require a physical installation by workers has declined but it’s likely to spring back up as efforts are made to control the pandemic.
“The emerging products such as automatic hand-washing machines, sterilizing steam mops and dishwashers have seen a surge in demand. Traditional sterilizing washing machines, disinfection cabinets, and air purifiers are also favored by consumers,” he added, speaking to China Daily.
Additionally, to compete with E-Commerce a “New Retail ” format has emerged – an innovative model that Chinese retailers are pursuing in order to tap into the rising consumer demand and retail experience.
New Retail is a tailored product and is applicable through an omnichannel retailing that has a strong reputation and has been developed almost entirely online. This business model incorporates existing channels to become completely integrated to offer customers a seamless shopping experience. Customers can simultaneously use different channels in their shopping process, starting their search at a channel and finish the purchase in another one.
China is also investing in short term measures, such as undertaking strict cash flow oversight, identifying new financing channels and additional strategic investors, and restructuring the business.
The US market has a huge E-commerce footprint and most consumers are used to making purchases online. With more complete e-retail experiences available, and shipping times greatly reduced, it is not surprising that 96 percent of Americans utilize online shopping in one way or another.
However, the same Americans spend a large amount of their total shopping budget in traditional brick-and-mortar locations as well. In other words, while almost everyone is shopping online, they are also making more purchases in-store.
When we deep dive, there are a few unique factors that help American retailers compete with e-commerce.
Customer Experience: When transitioning between online and in-store experiences, customers not only want the same products to be available, they also want their experience to be seamless and these retailers are able to provide that.
Customer Loyalty: Customer experience is the biggest contributor towards brand loyalty, with negative experience being the most significant factor in affecting a customer’s likelihood to make a repeat visit.
Siloed Marketing Infrastructure:
Modern marketing makes it necessary for businesses to engage with their customers across many different channels. From SMS to email and social media, multi-channel communications are essential to engagement which, in turn, drives the creation of the perfect customer experience.