China is not only one of the biggest, but also one of the most dynamic home appliance markets in the world. Internet commerce is developing rapidly and experts expect that online sales will make up 35 percent of all sales in China by 2020. How do you meet this challenge?
“As indicated, the China market is quite different from western countries when it comes to e-commerce. There is no distance between urban and rural consumers, nor between sellers and buyers on the Internet. E-commerce benefits all parties with higher efficiency, which is why we believe it will gain increasing popularity among younger generations. We are fully committed to adapt to this challenge and place great emphasis on improving all of our online and offline sales channels in China, using a so called multichannel strategy. To give you an example: When we launched the new MD7000 multi-door fridge from Siemens on Tmall, we offered a digital story of the new product in an online advertisment. In the same time, we provided links and addresses of offline dealers, where consumers could go and see the product in person, get a touch and feel of it and enjoy all the launch promotion benefits.”
Outside of China, not many people are familiar with Tmall. Can you provide some details about the partnership?
“Among all e-commerce platforms, Tmall is one of the most popular ones due to its abundant stores, reliable infrastructure and desirable customer experience. That’s why we have been closely cooperating since 2011, when BSH opened its first dealer shop. In 2012 Siemens opened the first flagship store and Bosch joined in 2014. In 2016, BSH and Tmall expanded its partnership into even more fields, including business and sales, digital marketing, supply chain, and other digitalization projects. We can profit from Tmall’s profound experience in online marketing for instance, which provides great advantages to increase brand awareness among online shoppers.”
What kind of consumers do you address on Tmall and which products are do they buy?
“We are addressing mainly young white-collar families as well as the new generation of consumers who are attuned to online shopping. Last year, driers, high-end multi-door and side-by-side refrigerators, and built-in kitchen appliances were the hottest products in our Tmall stores. We even launched a special Tmall edition of the Siemens Aurora multi-door refrigerator in March 2016, which is available exclusively to Tmall consumers. And in September 2016, BSH joined the Tmall Brand Day to exclusively launch several new products in China including the Siemens focus washer and the BLDC hood. Thanks to China’s overall market development, our business on Tmall has enjoyed great success accounting for about 30 percent of BSH China’s online business in 2016. As the only white goods brand Siemens even received an award for “Best Innovations”during the first Tmall Technology and Electronics Summit last year.
Tmall seems to be a very important sales channel but it’s not the only partner for implementing the local multichannel strategy, is it?
“No, of course it’s not. In the future, we hope to work with Alibaba, the parent company of Tmall, to explore new and innovative areas of cooperation – especially with regard to the high percentage of mobile users in China, who contributed more than 80 percent of our online sales, last year. Of course, we are also working with many other partners and we’re continually increasing the number of online and offline dealers, we are working with. It’s the goal of our multi-channel strategy to further improve the consumer experience and to offer more options and possibilities on all channels. Strong partnerships are a good base for such activities.”