Over the past year and a half, the TCG industry has not only faced major challenges, but has also undergone significant changes. And the next few years may bring new challenges and even more significant changes for the sector. We spoke to Chris Buecker, Chairman of the TCG Summit conference series, which brings together the industry’s most prominent leaders, to know his views on the future of the industry, based on the experiences and opinions of the key players in the global market.
What has been most striking to you throughout the Covid-19 period?
What has been most striking to me was the ability and agility to do whatever it took to adapt to the chaotic and challenging phases of this pandemic. Retailers has had to cope with stores being forced to shut, to open again before being shut once more with heavily restricted opening regulations. It has had to accelerate its online capabilities and services to meet consumer demand which was forced to go digital and has then stayed online. Leadership team have had to lose employees, send thousands into short-term work. Employees suddenly found themselves working from home and they were in desperate need to equip their new “home office” with the fundamental devices and services. And notwithstanding the immense challenge never seen before in our generation, tech retailers and the whole industry managed the challenge and even experienced an unexpected growth in 2020. Besause of home office some categories such as laptops, IT peripherals and Small Domestic Appliances were even booming.
How do you see the market development in the near future?
In our last survey we conducted last May with senior executives from the TCG industry from more than 30 countries in Europe during the online “TCG Summit Leaders Talk”, the vast majority saw a continuing positive trend also for the full year of 2021. In the first half of 2021, it became more and more clear that for employees a return to the former office life would not be desirable. Companies will adapt their office policy accordingly to stay attractive. A larger number of employees who in the first phase of the pandemic equipped their home office provisionally, are now demanding more sophisticated products for their home. Therefore, the industry foresees a continuing request in particular for products in the IT and Small Domestic Appliance categories. What TCG retailers and brands ask themselves is how the CE market will look like in 2022 when employees will be equipped and with high sales figures in 2020 and 2021 to compare with. This will be interesting to see.
What do you think about the future role of online and offline in the TCG sector?
I think we have to forget about the terms “online” and “offline” but rather speak of “One channel”. The pandemic has speeded up the digital transformation and showed tech retailers who are lagging behind in a brutal way the truth of the necessity to implement a real omnichannel business model. Last year, the leading CE retailer in Russia, M.video, was voted by the Grand Jury of the TCG Summit as the “CE Retailer of the Year” for the successful evolution from an omnichannel to a “One Retail” retailer which is based on mobile technologies, data analytics and personalized service. By now, around 60% of their total revenue is internet-driven. Nowadays, consumers, along the customer journey, move seamlessly from one touchpoint to the other. Thus, there is a critical focus on the build up on creating a true one channel experience. Online video consultancy with sales associates directly from the store level will become a normality
“I think we have to forget about the terms “online” and “offline” but rather speak of “One channel”. The pandemic has speeded up the digital transformation and showed tech retailers who are lagging behind in a brutal way the truth of the necessity to implement a real omnichannel business model.”
Chris Buecker, Chairman of the TCG Summit conference series
UK-based Dixons Carphone and M-electronics, an electrical specialist retailer in Switzerland, just to mention two examples, have already launched it. Even though the customer experience is not perfect yet, it will become professionalized over the time and turn into a strong additional tool for brick&click retailers. Another example: Even faster delivery services are now the norm but as China is showing, this can be taken to a new level. Also from China, the growth in live streaming commerce is becoming a whole new channel. Social media too is offering numerous opportunities. At the in-person TCG Summit which will be held in Budapest from October 5-7, Alibaba and an expert for retail in China will dive into compelling business cases and what European tech retailers and brands can take out from it.
What will be the role of stores in the future?
Shops will not be dying but retailers will need to define what is the role of the stores. We appreciate one thing – technology becomes more and more complicated and customers need help in order to choose the right technology for their needs. And help will be given by technology but also by people. So, what the stores have been given are people. People to talk to. Therefore, stores will be there in future, maybe not exactly as we have seen them before, not just as stock piling units but as “houses of interaction”. Houses where consumer can see, touch, enjoy technology and experience but most importantly where they can interact with (sales) people who have the knowledge to navigate customers to their final choice.
What do you think are the prospects for the industry in the coming years?
For the coming years, I am positive, and I see two major opportunities for our TCG industry. During the Covid-19 crisis, technology has been recognized by consumers as a way forward. So, technology has been a solution and NOT a problem. And the first big opportunity is to convince consumers to buy more technical consumer good products. Therefore, the TCG sector is in a good position when fighting for the share of the consumer´s wallet. Commonly, a larger retailer sells more than 50-60 technologies instore and online but the consumers nowadays may have only 10 or 20 of these. Thus, there is a big opportunity to grow by expanding the technology which is used by customers.
The second major opportunity is to accelerate innovation. To accelerate the cycle of renewal. In crisis mode, people tend to buy more durable products that would last longer. Here, tech retailers can play an important part. Consumers should not buy the cheapest but the best. During crisis, buying products that last longer is a much better economic solution than any other solution. The way forward is thus to broaden the technology presence within households and customers and a faster cycle of renewal of products. If we will be able to apply these two opportunities, then I will be very optimistic for our industry. We will discuss about these as well at the TCG Summit from October 5-7 when the leading tech retailers throughout Europe and the global CE and household appliance brands will come together in Budapest.