It is no secret that traditional retailers in Germany, which are organized into buying groups, have a strong affinity to sell home appliances. Many of them have roots as service mechanics for major German appliance brands, and over the years have expanded their offerings to include consumer electronics, IT and telecom products. However, they have stayed true to those roots and continue to lean on home appliances as their core business.
A few weeks ago, we spoke about the impact of the lockdown on the German retail channel, as well as how they leaned on their core competencies to resume business once things reopened. As far as buying groups go, they went back to relying on selling home appliances.
At the beginning of the lockdown (week 12), buying groups accounted for the highest ad share for washing machines (promoting phone consultations and free delivery) while their stores were closed.
When retailers were permitted to re-opening, larger stores were forced to decide what part of their assortments to make accessible due to regulations around store size, the buying groups (contrary to the large chains like MediaMarkt or Saturn) kept on pushing for appliances.
gap intelligence observed significant promotional activity in-store and online at the buying groups particularly for the mid- and high- price bands within home appliances. While buying groups stayed consistent with their attention toward home appliances, hypermarket / CC retailers also focused on the segment during the lockdown.
The hypermarkets / CC retailers varied their ad share on home appliances over the time period from 20% to over 75% with an average share of their promotions between weeks 12 and 21 at over 50%. These retailers were allowed to open their locations during the lockdown and looked to capitalize on consumer demand when other stores were forced to be closed.
Throughout the changes to retail stores during the lockdown and reopening, buying groups stayed committed to their core competency and focused on home appliance sales through their promotional activity.
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