As JB gets set to invade the appliance market, CN caught up with rival Appliance Online to get their reaction.
“It will definitely be interesting” if JB Hi-Fi enter the white goods market as rumored, admits Peter Harris, General Manager of Appliances Online (AO), an online leader in the space.
“I’m not surprised at all ..its a logical step” he says as major players have collapsed of late.
“The move is basically the same as we made into AV” says Harris, referring to the appliance retailer moving into the audio and TV market, announced last month.
“JB are looking to grow and are aggressive in their growth strategy, and already have experience of the market with Clive Anthony stores.”
“It will be interesting to see how they do it,” he admitted.
As revealed by CN last week, JB HiFi is to rebrand its existing Clive Anthony stores as ‘JB Home” in early 2013 with new stores opening in several locations.
Many retailers and brands alike are going heavy on higher margin white goods, compared to CE, which has been hit hard by price deflation and intense competition.
A JB Home appliance web site is also said to be part of the master plan.
So are AO worried now that an “aggressive ” new player may be unleashed?
“We’re not worried” Harris told CN ..”we always knew there would be more competition and others doing what we’re doing.”
Harris also insists its long established presence in the market and service reputation among consumers help insulate it against competitors, adding “a lot of other companies come and go” especially in the online space.
“Our business is different in terms of retail,” says the Appliance Online GM, whose business is purely online with no bricks and mortar presence aside from a few showrooms.
Does he see a white goods price war emerging in 2013?
“Definitely” he says, adding “you d be silly not to think there will be more [price] competition.”
He also refers to AO ‘price guarantee’ which means everything is included in the price and no extras.
However, Harris says the Australian appliance market is over serviced and there are already some big players in the space.
But there’s still a lot to play for – the Australian appliance market is currently worth $19 billion and includes Beta Living, Appliance Online Australia, Good Guys, Harvey Norman, Clive Anthony and Retravision.
Appliance Online is gearing up for a big Christmas and New Year and anticipates a busy trading period, although Harris believes an interest rate cut by the Reserve yesterday would have given business an additional boost.
And how is AO new AV business faring?
“We’re very happy with it so far and we’re seeing consumers buying appliances and AV in the same basket as we anticipated.”