10/29/2009 2:49:00 PM
Will the Christmas sales period save a tough year for retailers?
Mobile phone retailers had a dismal start to the year. In the first quarter, they collectively posted some of the worst figures since 2001. The predictions for the rest of 2009 were gloomy to say the least. Retailers had no choice but to be competitive and that led to an erosion of their profit margin. But June and July seemed to offer some hope as sales picked up with figures returning close to seasonal norms. Whether margins returned to anything like those in peak years is another matter.
The one area that continued to buck the downward trend was smartphones; the iPhone in particular. And now, Apple’s offering has been joined by a host of new smartphones aiming to cash in on the vital sales period in the run-up to Christmas. But will the combination of the traditional pre-Christmas sales bonanza and the increasing adoption of smartphones save the retailers’ year?
It’s a hard one to call, as the picture is pretty murky at the moment. But Carphone Warehouse offers a glimmer of hope. Its retail staff must be doing something right if they are exceeding their targets, as our front page story reveals. The only problem is their targets have been increased to make up for other under performing areas of the business. Carphone is pinning its hopes on the still relatively untapped data market, hence its Christmas emphasis on laptops.
The rest of the mobile retail sector is going to have to come up with some exciting ideas if it is going to entice consumers back into their stores. There are anecdotal signs that footfall is increasing, so the sales figures for 2009 might not look as bad as predictions at the beginning of the year. The question remains whether retailers will be able to raise margins as well.