Euronics boss Benedict Kober sees new perspectives for his own business through the planned takeover of Europe’s largest electronics retailer MediaMarktSaturn by the Chinese e-commerce giant JD.com.
The planned takeover means opportunity and risk. “With a noticeable preponderance of opportunity,” Kober told the German Press Agency at the cooperative’s headquarters in Ditzingen, Swabia, near Stuttgart.
Since the retail space would probably not be expanded, existing products would have to be substituted accordingly. Euronics is in close contact with the manufacturers. Sales that they might no longer generate at MediaMarktSaturn could be generated at Euronics.
In the event of the takeover, Kober expected a higher proportion of Chinese products in the competitor MediaMarktSaturn’s range in the future. It is a well-founded assumption that Chinese products will receive a significantly greater focus.
Euronics relies on premium
In the TV market, the average price has already come under considerable pressure due to Chinese manufacturers. Of course, this could also happen elsewhere. In the end, none of them could create a very profitable business. Accordingly, Euronics has to keep the premium share of its product range high in order to be able to generate the corresponding income that it needs for such retail spaces. Kober sees the opportunity to be able to formulate an offer for customers in the higher-value area so that they can buy from Euronics in the future.
JD.com is strongly focused on logistics and supply chains. If they were to follow this approach in Germany as well, issues such as same-day deliveries would be in the foreground. Customers in Germany are used to going to a store and picking up the goods directly on the shop floor or at the goods issue point. It remains to be seen whether they would accept having a product delivered to their home in six hours, for example. The specialist advice and personal proximity to customers also speak for Euronics, said Kober.
Expert: “make a name for yourself through advice and service expertise”
Retail expert Kai Hudetz also sees opportunities for chains such as Euronics or Electronic Partner through the planned takeover of MediaMarktSaturn. He expects that in the future they will be able to “distinguish themselves even more clearly through personal advice, service expertise and customer proximity”. And thus about those factors that digital platforms would be much more difficult to map. Studies have shown that two thirds of consumers have strong reservations about platforms from the Far East.
“Stationary competitors of MediaMarktSaturn could use their roots in Germany and the respective region even more strongly as a sales argument,” said the managing director of the retail research institute IFH Cologne. There is much to suggest that JD.com will make the takeover as inconspicuous as possible to the outside world in order to largely preserve brand perception.
JD.com made a takeover offer for MediaMarktSaturn parent company Ceconomy last summer and secured the majority of the shares a few months later. However, final approval is still pending in several countries. On the NASDAQ, JD.com shares ultimately rose 0.18 percent to $28.51.
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