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Technology retail – darkest hour or rebirth?


Technology retail – darkest hour or rebirth?

Technology retail – darkest hour or rebirth?

Recent months have seen technology and consumer goods retail under pressure. In the last 12 months the stock market valuation of Dixons Carphone is down by 43%, Carrefour by 25%, Maplin is in administration, the combined valuation of Ceconomy and Metro AG is below its equivalent last year, whilst Amazon’s value has shot up by a staggering 84%, borne up by the bull market but once again benefiting from the high valuation accorded to successful ecommerce companies. The stock market is saying simply – this is where the future lies.

So, in this context I am looking forward to finding renewed inspiration in the TCG Summit in April, which its founder, Chris Buecker, has established as the reference meeting-place for senior players in the Technology and Consumer Goods industry.

The spirit of last year’s summit was embodied in the keynote by Nilesh Khalkho, CEO of DG Sharaf. His talk exuded belief in the power of retail – accompanied by examples of how he is extracting value from the company’s retail assets. The UAE may be an unusual retail environment with high spending and relatively low ecommerce penetration, but the point was the spirit. There was something Churchillian about the combative way with which he approached the subject. If you have seen the recent film “Darkest Hour” about the wartime prime minister, then you know that Churchill bullied his fellow parliamentarians into adopting his fighting spirit. This is what we need in technology retail today – strong leaders who rise above the chorus of “retail is dead” and who push through long-term transformation of their businesses.

We are, therefore, fortunate this year to hear two retailers who are pushing their enterprises forward in transformation – Enrique Martinez, the CEO of Fnac-Darty, the only major Europe based technology retailer to have grown its market capitalisation in the last year (by 48%) – will be in conversation with Declan Curry on the first day talking about the company’s progress on transformation. And on the second day we hear from Martin Wild, newly appointed Chief Innovation Officer of MediaMarktSaturn Group, hot from installing his first checkout free store in Austria.

If there is one thing I am looking for from those who intervene in the TCG Summit, it is a sense of urgency. I want to hear of:

  • Retailers who are investing in digital transformation. Last year at the TCG Summit CONTEXT presented the John Lewis results with its growth in revenue in the last 5 years and its leadership in omnichannel, paid for by reduced profits and reduced payouts to “partners” – the John Lewis employees who own the company. This year our presentation would show a darker hour for John Lewis as the profits are down a further 77%, but this is a true example of long-term transformation and of a company that is investing in the future. Talking about omnichannel is one thing. Investing hard-won retail pounds or euros into it is another
  • Or retailers who are knocking heads together of vested interests who resist change. There are some hard choices to be made and those holding back need to realise that it is now or never
  • Or retailers who are sharing customer data with their vendors. Lucas Perraudin, head of retail and online at HP, speaker at last year’s TCG Summit, wrote recently about HP and Dixons Carphone “Data collaboration is the way forward and we are moving there! It has never been so good to be a customer and so hard to be a retailer! Building data bridges that enable cross touchpoints visibility of customers for brands and retailers will help deliver delightful shopping experiences.”
  • Or retailers who are building strategic partnerships with distributors to make the last mile work more effectively. Recently Fnac-Darty announced its “Retail As A Service” omnichannel footprint supported by an investment plan dedicated to the digitalization of stores, e-commerce platforms and logistics assets. In those discussions about logistic assets distributors could be their very best friend in providing capital investment and knowhow
  • Or retailers who are making it easy for innovative products to come to market. The saying is that companies invent new products in Asia, sell them in the US and get confused in Europe. And where do they go for the sake of ease – Amazon of course. How about if retailers and distributors at the TCG Summit agreed to form a common platform for the launch of selected start-up products across Europe?

So, in summary, I look forward to the upcoming opportunity at the TCG Summit for top retailers and manufacturers to find ways through the keynote inputs, and above all the networking, to act together, courageously and urgently, to transform their businesses.

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