Influencers 2014: Bosch & Siemens MD offers rare insight into competing in an “incredibly saturated market”

Welcome to Influencers, our annual series that speaks with the heads of retailers, suppliers and industry bodies to find out what is happening in appliances and electronics and how different companies are shaping its future.

Today we hear from Volker Thaens, managing director BSH Home Appliances (Bosch & Siemens). Despite running one of the most important and influential subsidiaries in the industry, Thaens is not oft interviewed or quoted in the media. For that reason, it is also great to learn his thoughts about the Bosch and Siemens business and the industry as a whole.

Volker Thaens

Highly competitive in a saturated market: Volker Thaens.

How has the first half of 2014 been for your business?

2014 has brought to fruition many interesting changes to the home appliances industry. BSH has seen market share growth in some categories and stagnating business in others. We have seen most of that growth in its higher price classes as it moves away from the entry-level price point bracket. The biggest challenge for us has been in washing machines as we shift our focus away from entry-level prices and direct our attention to technological advances in this category.

What are your predictions for the second half of the year?

In an incredibly saturated market, the second-half of 2014 is expected to be highly competitive. As consumer confidence weakens and spending tightens, we anticipate the need for promotions to entice consumers into store will increase significantly.

From BSH’s perspective, we are expecting to see Australians opt for the ‘simpler’ product options on offer — with fewer features — in an effort to save money as consumer sentiment becomes progressively money conscious.

What opportunities do you see for the electrical retailing industry?

Increasingly, we are seeing how technology, in particular, the internet offers a strong platform for brands to connect directly with consumers, providing product information and experience over and above the retail environment. Despite being inundated with information, I believe there is not enough cut-through for the consumer to understand the key benefits of products.

With a greater knowledge bank, consumers will understand that savings of water; electricity — and now even washing detergent — over a 10-to-15-year usage period are significant and
may influence the justification of a greater initial investment.

Bosch and Siemens Home Appliances see the flexibility offered by premium products as a drawcard for the time poor consumer. Moving forward, consumers will have a greater choice in how their appliances best suit their needs. For example, whether they opt for performance with optimal resource efficiency or choose programs that meet the demands of faster results.

Furthermore, self-cleaning technology in pyrolytic ovens, self-cleaning filters in dryers and vacuum cleaners and the easy-care of induction cooktops will make life easier and save time for the more enjoyable things in life.

As these trends continue, and retailers and manufacturers become aware of the need to inform the consumer of these benefits, we will see the potential for electrical and appliance retailers expand.

What threats are currently present in the industry?

In the last 12 months, the industry has increased its focus on competitive pricing structures as a measure of success, concentrating less on the best performing products, the best consumer benefits and the best retail service. Consumers who purchase with price as their key decision maker may find they limit their appliance performance capabilities and long-term cost-saving opportunities on water and energy rates.

What is your favourite product of 2014 so far?

Bosch’s i-DOS HomeProfessional Washing Machine (WAY32840AU, RRP $2,599) is the ultimate in simple, effective and green laundry technology. It’s the only washing machine with a fully-integrated automatic Intelligent Dosing System that can save up to 7,062 litres of water per year.

Bosch i-DOS HomeProfessional (WAY32840AU) (Duo)

Effective and green: Bosch i-DOS HomeProfessional.

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