Testing times for the new kids on the mobile market block

0
801

James Pearce looks at how John Lewis, Westcoast and Gigaset might fare over the next 12 months in such a competitive industry 

I once had to start a new school in the middle of a school year and remember walking into the classroom, with the other students all already sitting in their established seats staring at me. It was intimidating and I knew finding my spot was going to be tough.

That is the situation facing three companies covered in this issue of Mobile News who are all latecomers to established markets within mobile: John Lewis, Westcoast and Gigaset.

All three are huge names in their own right. John Lewis is one of the most famous department store brands in the UK and has a strong legacy of selling consumer electronics, but it has set itself a huge target of having a ten per cent share of UK SIM-free sales within a few years.

Newbies
Meanwhile, Westcoast has also entered the handset market after being named as one of only three distributors to stock the iPhone for the UK’s B2B channel. Westcoast has a large background of distributing IT equipment and plans to use that legacy to enter the mobile space.

Gigaset was once part of German engineering giant Siemens giving it more than 150 years of history to call on, but the switch from fixed-line phones to mobile is arguably its biggest challenge yet.

The mobile market is already saturated in almost every way. Gigaset CEO Charles Frankl said the German firm was aiming at the top-end of the market, putting it in direct competition with Samsung and Apple. Very few companies have successfully outsold those two manufacturers, and even with the backing of Chinese billionaire Pan Sutong, there may be one too many hurdles for Gigaset to overcome.

Apple is also an important company for Westcoast going forward, but as a partner, not a rival. The fact that the Californian manufacturer selected Westcoast to distribute the iPhone, along with just two other distributors (Ingram Micro Mobility and Tech Data Mobile) is a huge vote of confidence.

It isn’t all clear sailing for the Reading-based distributor though. Ingram Micro’s move into mobile came with the acquisition of BrightPoint, while Brightstar picked up 20:20. Westcoast plans to enter organically and that will be tough without signing up more mobile vendors.

Tough, but not impossible. Exertis has shown this, and with the market consolidating, that leaves room for others to sweep in and gain traction. Westcoast also brings a strong IT reseller base and its success will be determined by its cross-selling appeal. Signing up the iPhone gives it the best possible start to its journey into mobile.

Mobile ambitions
For John Lewis, the question is not whether it will be able to sell mobile phones – the partnership with Vodafone almost guarantees some level of success and ranging devices from the likes of Apple, Samsung, HTC and Sony will help.

Adding extended two-year warranties on SIM-free deals is a great way to differentiate its offering, but its target of 10 per cent of SIM-free sales – estimated to reach 2 million units this year (CCS Insight) – is a massive number of phones.

They claim to have 10 per cent of the UK consumer electronics sales and will be hoping that the experience of buying electronics from them resonates with existing customers, but it is a very crowded market.

To be a latecomer in a competitive market is an unenviable task. It is not impossible, but it will be interesting to see where Gigaset, Westcoast and John Lewis are in terms of mobile strategy in a year’s time.

NO COMMENTS

LEAVE A REPLY