Online Retailing  

Demand for smartphone accessories drives European expansion

Richard Moore, Head of International at Mobile Fun, explores the significance of smartphones across the Euro Five
 Demand for smartphone accessories drives European expan..
 
 

The Eurozone crisis is dominating headlines and the economic situation looks gloomy in the UK too - figures from the British Retail Consortium showed retail takings plunged 3.3 percent in April, much worse than the predicted 0.5 percent rise. However, the mobile devices sector is bucking the overriding trend and opportunities in the European mobile industry go unabated. 

According to the research group Ovum, smartphones will outperform the rest of the mobile phone market, growing at a compound annual growth rate of 24.9 percent for the period from 2011-2017.

While the Euro Five of the UK, Germany, France, Spain and Italy dominates the mobile market, other smaller countries, such as The Netherlands, also represent lucrative opportunities. With the pace of mobile innovation driving demand for new devices, the rise in smartphone sales coupled with consumer market size, broadband penetration, proximity and ecommerce penetration levels offer an attractive international expansion opportunity for retailers.

However, Europe is not a homogenous unit and localisation is critical to success. Retailers must understand varying customer preferences such as; buyer behaviour, delivery or contact expectations and current market knowledge in that country.

Reducing risks in European expansion is pivotal when local incumbents already have presence and command a degree of loyalty. A balanced expansion portfolio helps verify the business expansion case. Mobile Fun has used the in-country approach in Germany and France, however in smaller markets such as Spain, the Netherlands and recently Italy, we have mitigated set up risks by bringing the managers to the UK initially until the sites are established, when full teams will operate the businesses in-country.

While increased European orders or enquiries can be an early indicator of demand, country selection and the ability to manage large scale replication of processes, services or products can determine whether a business is ready to move into a new territory or indeed prevent European expansion.

For companies willing to take an even bigger leap, Europe is just the first port of call and we are already shipping to over 50 countries with further international sites already planned.

Further expansion can, of course, present logistical and administration challenges, such as export duties, taxes and changes to business structure to provide high quality customer service. However, with a European population over 800 million, why not explore the lucrative market right on our doorstep?

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