Green electronics

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Selling consumer electronics, selling green and playing to inherent business strengths will keep retailers afloat throughout the current tough trading conditions on the UK high street. These were the messages of the annual London Intellect Conference in July.
Drawing on UK CE market volume and value figures throughout the 1990s recession, Dave Tansley, partner at Deloitte, showed that the sector as a whole remained relatively stable for that five-year economic downturn. CE products do not suffer consumer cutbacks in spending quite as much as other luxury items in this climate.
Majoring on the TV sector in particular, Neil Gaydon, CEO at Pace agreed that “people love their telly” and several market and technological developments pointed to sustained TV sales, if not huge growth, in the short to medium term. The increasing number of free-to-air digital channels, the growth of the PVR as a mass-market device (now at 25% UK market penetration) and the EU agreement on HD over DTT standards were slated as positive technology indicators. Increasing HD content and major sporting events in the run up to the 2012 London Olympics would ensure that consumers do not put off buying TV technologies.
Bricks and mortar
Much of this business will continue to go through the high street, according to Greg Hodge, manager for non-food research at market intelligence company Planet Retail. While noting that 15% of consumer purchases in the UK are now conducted online (up 54% on the same period in 2007), Hodge pointed to a growing band of very successful bricks and mortar retailers. “Pile it high and sell it cheap on the high street is over,” noted Hodge, “but [traditional] retailers have first point of contact, staff, staff training, customer interaction and customer service on their side.”
In terms of technology, there was broad agreement that greener and more environmentally friendly products would spearhead new product development. While admitting there was marketing momentum to be had from the current ‘green’ trend, Deloitte’s Tansley noted: “Greener products not only have a social responsibility but tend to be better designed, better built and better quality.”
Technological evolution
Moreover, Tansley assured delegates that any fears of technology moving too fast to sustain a viable market were unfounded: “Technology in the consumer marketplace actually develops relatively slowly and predictably – evolution not revolution.” He noted that the mobile phone took 30 years to reach its current penetration, portable MP3 music was around for 20 years before it really became mass market.
Laurence Harrison, director of CE at Intellect summarised the mood of the conference by stating that the UK buyer continues to be a voracious consumer of electronics goods and that the sector is still holding strong. He identified the three critical success factors for CE businesses as green technology, playing to core strengths such as service and customer contact, and convergence – dynamic ways of selling CE products based on both technology and content. Commented Harrison: “Companies that are the most agile will survive and succeed when we come out of the current downturn.”

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