The European electricals retail market has suffered in recent years due to a decline in consumer spending, although growth is expected in 2011. This report outlines the sector size across 27 countries, as well as forecasts to 2013. It also assesses the key issues faced by the sector, the main strategies being implemented and contains chapters on each of the leading electricals retailers.

1. Electricals Retailing in Europe: Market Size, Retailer Strategies and Competitor
Performance
The European electricals retail market has suffered in recent years due to a decline in
consumer spending, although growth is expected in 2011. This report outlines the sector
size across 27 countries, as well as forecasts to 2013. It also assesses the key issues faced
by the sector, the main strategies being implemented and contains chapters on each of the
leading electricals retailers.
Buy Now: Electricals Retailing in Europe Market
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Features and benefits
Benchmark your company’s performance by accessing profiles of leading electricals retailers
including key operating details and market shares.
Make informed country-specific investment decisions with forecasted electricals expenditure
to 2013 and in depth country profiles.
Ensure distribution and channel strategies are aligned or superior to those of other market
players by uncovering competitor activity in e-commerce.
Enhance shopper satisfaction by uncovering customer service strategies and instore services
being used by European electricals retailers.
Make informed pitches to potential electricals partners by gaining insights into their store
networks, shares, and current and future strategies.
Highlights
After the economic downturn in 2008 and the deterioration of market conditions, the
European electricals market is struggling to achieve growth. Electricals expenditure
rebounded slightly in 2010 by 0.6% to €158.7bn, after the slump in the prior year.
Although still affected by the economic downturn, countries such as Poland, Romania and
Turkey provide a new battleground for key electricals retailers as they seek to establish
themselves outside of their core markets.
Metro Group’s Media Markt and Saturn fascias have proved formidable with an overall
European market share of 13.1% based on sales of €20.8bn in 2010. The fascias’ strategies
of low prices and aggressive marketing is well suited to more austere times, although they
have not been immune to difficult trading conditions.
Your key questions answered
Which European markets hold the most potential for the electricals sector and should I
invest in them? Which markets are in decline?
What is historic and forecasted expenditure on electricals across the EU27 countries and
what level of sales have specialist retailers achieved?
How is my company performing relative to other retailers in the European electricals market
and what is an achievable market share objective?
How did players such as Kesa, Dixons Retail, Amazon and Best Buy perform last year?
Where do they have stores and online operations?
Who are the European electricals buying groups and how are they performing?

2. Table Of Contents
OVERVIEW
Introduction
Summary
KEY FINDINGS
Electricals in the EU have suffered a decline as retailers face poor market conditions
Consumers are opting to cut back on electricals spending in favor of saving
Consumer spending on electricals is set to grow in 2011
The slowdown in technology innovation is a threat to retailers’ sales
Opportunity for retailers lies in Central and Eastern Europe
A multichannel strategy captures all sales opportunities
Specialists have implemented new initiatives to drive sales and remain competitive
Media Saturn dominates specialist sales, while Best Buy has suffered in the UK market
STRATEGIC ACTION POINTS
Focus expansion on the Central and Eastern European region
In new markets, concentrate the store network in a single location to start
Roll out a successful concept in other markets
Offer consumers an innovative but logical store layout
Provide comprehensive instore customer service
Launch e-commerce operations
Offer consumers exclusive products
Develop and continually enhance private label propositions
Ensure promotions are timed to make the most impact
MARKET CONTEXT AND OUTLOOK
The sluggish recovery in the European housing market will pose challenges
Consumer spending on electricals has weakened due to the tough economic climate
Sales in specialist stores have suffered as consumers remain price-conscious
Specialists’ sales decreased by 6.3% across the EU in 2009, following a decline of 2.2% in
2008
STRATEGIC ISSUES
European retailers will look to Central and Eastern Europe to grow further
Computing and entertainment products will continue to drive the electricals market
The emergence of new technology is vital for growth in the electricals market
Innovation captures consumer interest in electronics
The technology pipeline will slow down during the coming years
Tablets is a growing market in the computing category, with Apple’s iPad the market leader
3D TVs have the potential to drive sales in consumer electronics
Exclusivity will remain important for retailers
Small uncomplicated products are increasingly moving online
A focus on premium products helps traditional retailers to protect their margins
e-commerce has become an important channel in the electricals sector
Pureplay retailers have become established players
Traditional retailers are now rushing to benefit from the growth of e-commerce
Multi-format retailing will play a crucial role in retailer success

3. Retailers will introduce private label ranges to entice shoppers and provide differentiation
Private label products have a number of financial benefits
Private labels help retailers to differentiate their offering
Private labels often equate to exclusivity, which can strengthen the brand and foster loyalty
Retailers will look to introduce more innovative instore layouts
Retailers with physical stores must invest in environment to compete with online players
Retailers look to Apple for inspiration
Retailers can learn from manufacturers when it comes to theatrics
Retailers will continue to invest in customer services
Retailers offer advice and support to consumers as a means of enhancing their proposition
Retailers are improving their customer service offerings to compete with rivals
Employees can help consumers to trade up
COUNTRY FOCUS
Electricals retailing in Germany has been boosted by the strong economy
The German electronics market is the largest in Europe
Media Saturn remains dominant in the German electricals market
Recent developments and trends
The French electricals market is dominated by domestic players
Discounting and fickle consumer confidence have been the key challenges for the sector
Darty is the largest specialist in the French electricals market by store numbers
Recent developments and trends
Best Buy entered the UK electricals market in 2010
The UK electricals market is the second largest in Europe
Dixons Retail leads the UK electricals market, closely followed by Kesa
Recent developments and trends
Electricals specialists have focused on growing store networks in Italy
Italy has the fourth largest electronics market in Europe
The Italian electricals market is fragmented
Recent developments and trends
Dixons has exited the underperforming Spanish electricals market
Spain is the fifth largest European market in the electronics sector
Buying groups play a pivotal role in the Spanish electronics market
Recent developments and trends
The largest retailer in the Netherlands is a domestic player
Recovery in the Netherlands has been patchy
A number of large retailers are fighting for market share in the Netherlands
Key trends and developments: Media Saturn is committed to consolidate its position in the
Netherlands
Krefel is the largest domestic player in the electricals retailing market in Belgium
The Belgian economy fared better than others during the economic downturn
Domestic companies and international players share control over the Belgian electricals
market
Recent developments and trends
Poland has come out of recession strongly, but the electricals segment is shrinking
Media Saturn and domestic retailers are major players in the Polish electricals market
Recent developments and trends
Domestic retailers Expert and Dixons Retail play leading roles in the Nordic countries
The largest Nordic countries fared better during the recession than Western European

4. markets
Elkjøp is the largest retailer in the Nordic region
The Norwegian electricals market is concentrated in the hands of Expert and Elkjøp
The Swedish electricals market is fragmented
A domestic player is one of top three electricals retailers in Denmark
Expert and Kesko are the largest players in the Finnish electricals sector
Recent developments and trends
In Austria, Media Saturn competes with domestic specialist Niedermeyer
The Austrian government has introduced various austerity measures to get the economy
back on track
The Austrian electronics market is led by Media Saturn’s Media Markt and Saturn banners
Recent developments and trends
Instability in the Portuguese economy has led to a lack of growth opportunities
Portugal has suffered due to high unemployment levels and political instability
The Portuguese electricals market is dominated by specialists
Recent developments and trends
Czech electricals retail sales declined in 2010, leading to heavy discounting
Czech consumers minimized spending on electricals in 2010
Okay Electronics is a key domestic specialist in the Czech electricals market
Recent developments and trends
Media Markt leads the Hungarian market, but Euronics has the largest store network
Hungary was issued a sizable bailout package in 2008 to aid recovery
Dixons Retail exited the Hungarian market in 2009
E-shop.gr dominates the online channel in the Greek electricals sector
The Greek economy is set for further contraction in 2011
The Greek electricals market is led by Dixons Retail’s Kotsovolos chain
Recent developments and trends
Dixons Retail and Harvey Norman are struggling in the difficult Irish market
Ireland received a bailout package from the IMF and EU at the end of 2010
The Irish electricals sector is dominated by Expert
Recent developments and trends
eMag has taken control of the online electricals retail segment in Romania
Romania sought help from the IMF to recover from the global economic downturn
The Romanian electricals market is dominated by domestic retailers
Recent developments and trends
Slovakia has been infiltrated by international electronics chains as well as non-specialists
The Slovakian economy is threatened by rising unemployment levels
Domestic player NAY operates across the Slovakian market and recently celebrated its 20th
anniversary
Recent developments and trends
The Bulgarian consumer electronics retail sector is dominated by domestic players
The Bulgarian electricals market suffered from a sharp decline in credit sales
The two largest domestic players account for the majority of the electricals market
Recent developments and trends
The Slovenian electricals retail market will change considerably if Merkur cannot recover
Rising unemployment levels continue to stunt growth in Slovenia
Merkur Group is having to restructure due to debt
Recent developments and trends
The Baltic States were badly hit by the economic downturn

5. Following the recession Lithuania experienced consolidation in the electricals retail sector
Euronics has made a greater commitment to the Lithuanian market
Recent developments and trends
The Latvian economy was in turmoil but is now recovering
The electricals retail market is fragmented and dominated by small domestic players
Recent developments and trends
The Estonian economy was hit by the recent recession, and the market is still feeling the
impact
Euronics and Expert are both present in Estonia
Recent developments and trends
COMPANY COMPARISONS
Key operating statistics
KESA ELECTRICALS
Company overview: Kesa is a key European player, with France as its largest market
Kesa operates under five key brands
Kesa has two private label ranges
Kesa seeks to develop a multichannel offering
Recent key developments: the retailer is investing heavily in e-commerce
Kesa has been investing in online and mobile channels
There have been a number of management changes at Kesa
The retailer’s UK brand has been relaunched
Trading record: Kesa’s financial performance has been volatile
In 2007–11 Kesa’s finances were negatively affected by international expansion
Store portfolio: Kesa has been focusing on expansion beyond its core markets
Outlook: Kesa needs to make the UK and other international operations profitable
DIXONS RETAIL
Company overview: Dixons Retail derives almost half of its revenues from the UK and
Ireland
Dixons Retail is Europe’s second largest electricals retailer
Dixons Retail trades under a variety of different brands
The majority of the retailer’s international stores are large out-of-town formats
In the UK, Dixons Retail has a joint venture agreement in place with mobile phone retailer
Phones 4u
The group has scaled back its private label offering
Dixons Retail is faced with an increasingly competitive environment
The company is focused on developing its multichannel offering further
e-retailer PIXmania operates across 26 countries, with 17 European stores
Recent key developments: the group has launched new store formatsThe retailer has
embarked on a major transformation project
The group has recently launched a new brand offering repair and maintenance services
The retailer has recently divested a number of its unprofitable international operations
Trading record: the Nordic region and e-commerce have helped drive group sales
Store portfolio: the group has opted to reduce its store numbers
Outlook: the group faces the challenge of transforming its recent restructuring into financial
gains

6. MEDIA SATURN
Company overview: Media Saturn operates the Media Markt and Saturn brands
Media Saturn’s owner Metro Group is primarily focused on grocery products and electricals
Media Saturn relies on decentralized management
Media Markt has a larger retail network than Saturn
Recent key developments: Media Saturn has recently expanded into China
A new CEO was appointed
Media Saturn has divested its French operations, and is committed to expansion in growth
markets
Media Saturn has been increasing its commitment to the development of the online channel
Media Saturn has developed its private label offering
Trading record: the group’s recent financial performance was strong, with the exception of
Q4 2010
The retailer has recorded strong trading results across 2005–10
Growth in sales was driven by new store openings
The retailer’s stores in the Netherlands, Switzerland, and Belgium generate the highest
sales per store
Store portfolio: almost 45% of the retailer’s stores are located in Germany
Outlook: the group’s decentralized structure threatens the success of its corporate plans
FNAC
Company overview: Fnac is owned by French giant PPR
Fnac is PPR’s largest business
Recent key developments: PPR has started to divest its electricals businesses
Trading record: Fnac remains heavily dependent on the French market
Fnac was significantly affected by the economic downturn, but has since recovered
France is Fnac’s largest market, but its importance has been diminishing in recent years
The personal computers category is Fnac’s key revenue stream
Recent trading: three months to March 30, 2011
Store portfolio: Fnac has invested in its retail network
Fnac has significantly expanded its retail network across France, Spain, Portugal, and Brazil
Outlook: PPR’s decision to focus on luxury goods poses a threat to Fnac’s future
CONFORAMA
Company overview: PPR has recently divested the Conforama chain
Conforama is now owned by Steinhoff International Holdings
Recent key developments: Conforama has focused on new store formats and private labels
Conforama has launched two new store formats
Conforama acquired an online and mail order specialist
Conforama launched a private label range
Conforama has focused on enhancing its customer service
Trading record: Conforama’s trading is improving after a period of sustained poor
performance
Conforama’s dependence on the French market has been growing
The electricals category’s share of revenue declined only marginally between 2005 and 2010
Store portfolio: Conforama has been growing its store network
Outlook: Conforama will benefit from being part of Steinhoff International Holdings

7. AMAZON
Company overview: Amazon dominates European online electricals sales
Amazon looks set to further dominate the European online electronics market
BEST BUY UK
Company overview: Best Buy UK has not made the impact it expected to in the UK
Best Buy will need to evaluate its UK strategy in order to compete with established rivals
ELECTRICALS BUYING GROUPS IN EUROPE
Overview: electricals buying groups allow smaller players to compete with large retailers
There are a number of powerful buying groups in the European electricals sector
Euronics International is the largest European buying group
Expert has an extensive global reach
EDA leaves considerable autonomy for its members
ElectronicPartner has recently suffered from disputes within the owner family
Outlook: future opportunities lie in Central and Eastern Europe and online
APPENDIX
Methodology
Further reading
Ask the analyst
Global Retail FreeView
Verdict consulting
Disclaimer
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