The Good Guys keeps garnering awards for its innovations in appliance retailing. In our 2015 Mid- Year Report Card, CEO Michael Ford explains how the company is faring in a tough market.
How has the first half of 2015 been for your business?
The first half of 2015 has been very positive for The Good Guys in a tough trading environment that is continuing to experience intense competition. Earlier in the year, we appointed a Chief Merchant and Chief Operating Officer to help align our company structure with our growth strategy. As part of our strategy to innovate through improved business processes and productivity, we have realised improvements as a result of judicious inventory and assortment planning. Home appliance sales have remained strong and the introduction of the premium brand Miele has allowed us to widen our range of high-end brands and further grow our market share in laundry and dishwashers. The Good Guys has continued to lead the industry in customer satisfaction, being awarded the Roy Morgan Customer Satisfaction Award for a fourth year running and the inaugural Reader’s Digest Quality Service Award.
What are your predications for the second half of the year?
We expect the second half of the year to be strong with some restored consumer confidence off the back of the recently released federal budget. The small business tax break should translate to sales of higher-end tech products as well as TVs and appliances for staff kitchens. Furthermore, home renovation is still a high consumer priority, which provides great opportunities not only for replacement products, particularly home appliances, but also kitchen cabinetry sales.
What opportunities do you see for the electrical retailing industry?
The path to purchase for today’s consumer begins in the digital space, so a big opportunity for all of us in the industry is to build a connected retail experience that uses data and insights, focusing on understanding the ‘why’ behind the ‘what’ in order to turn data into insights and then into action across all aspects of the business. At The Good Guys, understanding our customer and their behaviour, both on and offline, has changed the way we approach assortment planning, customer service and conventional and digital marketing tactics.
The emergence of the digitally empowered consumer has shifted the power from the retailer to the consumer as expectations have changed in line with their redefined path to purchase. This change has inspired us to build a capability and culture at The Good Guys to move us from having transactional-based contact with our customers to a deeper relationship. It is also the reason we recently introduced our new Concierge program, which is all about cementing an ongoing relationship with the customer post-purchase.
What threats are currently present in the industry?
The industry is highly competitive with the breadth of retailers in the sector. This has the potential to result in further competitive discounting, which is problematic given the decline in average selling prices we are already seeing. The answer is not competitive discounting resulting in further price erosion across the industry but rather finding new ways to innovate through productivity and customer service, and through technology.
What is your favourite product for 2015 so far?
That’s easy: Sonos wireless speakers that you control from any device.