Online sales to change face of IT retail
Al-Futtaim CEO warns Middle East channel to ignore global trends at their peril
Fujairah: Robert Willett, the current group CEO of Al-Futtaim and one-time CEO of US retail giant Best Buy, warned Middle East technology retailers to prepare for a major shift in customer buying behaviour during his keynote speech at the Digital Consumer Channel (DCC) conference last night.
Traditional ‘bricks and mortar' retail outlets remain the primary conduit for IT and consumer electronics products in the Middle East, but Willett said retailers only needed to look at other markets to understand they will need to adapt their sales models as competition from emerging online channels increases.
He noted: "A key thing that is happening - and happening faster than any of us probably ever realised - is that in the last few years we have seen the advent of the web and the advent of call centres and today for the first time the web is growing faster in Europe than it is in America. And it is growing even faster in parts of Asia."
Willett told retailers that web sales penetration in the global consumer electronics market was "astounding", with a third of products likely to be bought over the internet within the next two to three years.
"Those are not my figures, they are figures from various research organisations and the truth is I think they are understated... my view is that by the time we get to 2015 or 2020 we'll be looking at 30% or 40% [of CE products] being bought online."
Willett said there would still be a place for traditional retailers in the market but stressed the importance of having an online presence, both in terms of fulfilling transactions and as a source of information for consumers who now extensively research products before they buy.
He claimed that nearly 70% of all products purchased today are "influenced" by the web, even if they are subsequently bought in-store, and urged retailers to embrace the multi-channel model.
"Multi-channel is here and it is here to stay, and it will impact this market place," he said. "The astonishing thing is that it will probably impact it much quicker than you think because that is what has happened in Europe and certainly North America, and it is happening in China and Asia."
Willett recently became the group CEO of UAE-based conglomerate Al-Futtaim after initially being appointed to the company's board of directors in August last year. Prior to that he spent 15 years at Best Buy, which now boasts retail operations in more than a dozen countries across the globe