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Tue 3 Oct 2006 04:00 AM

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Service with a smile

Intense competition in the Middle East consumer electronic channel sector is forcing vendors, distributors and retailers to develop new sales strategies, with a key focus on retail staff training.

|~|customer-service200.gif|~|Retail training services are in high demand across the GCC.|~|The influx of new players in the regional consumer electronics channel sector, combined with booming consumer demand for electronic goods and services, is forcing many retailers to review their sales strategies in a bid to stave off their competitors and better serve their customers.

As a result, vendors and distributors are adopting new and innovative approaches to retail staff training services, in a bid to shore up their own positions in the marketplace.

With a raft of new competitors entering the market, vendors are fighting their own battles to ensure sufficient retail shelf space for their products, in addition to ensuring sales staff are properly briefed about their respective product portfolios.
Consequently, both parties are furthering their cooperation in terms of providing retail training services.

Bradley Bennett, business development manager for UAE power retailer, Plug-Ins Electronix, describes the ensuing symbiotic partnership between vendors and retailers as similar to a “marriage”.

“It has its ups and downs, but provided both parties view the partnership as one of mutual benefit it will generate huge results,” he says.

“Plug-Ins’ strategy is to foster these partnerships in order to maximise sales volumes.”

Bennett says in the case of Plug-Ins, which he describes as the “largest multi-brand consumer electronics retailer in the UAE”, developing close working relationships with vendors is vital to ensuring quality customer service.

“We need to provide our customers with facts and figures regarding products from up to 300 brands, which makes the support offered by our vendor partners that much more important.

“Highly trained staff represents the backbone of our business. In the past, staff training was not considered a major issue but as the market has become increasingly competitive, highly trained staff can provide a retailer with a distinct edge.”

Middle East consumer electronics vendors such as Dubai-based Nikai are heeding this call.

Nikai is one of the region’s most successful brands, cornering the market for affordable consumer electronics and household appliances.

Nikai assistant general manager Amit Vardhan says that while the company is mainly present in the entry-level sector of the market, it is committed to providing quality staff training services to its retail partners to stave off increased competition from new players entering the market.

“Providing staff training services is one way to differentiate your brand and your product range from those of your competitors,” he says.

“It is a value-added service that is crucial to developing strong partnerships with retailers.”

Nikai conducts regular on-site training sessions involving in-store sales managers, shopfloor salespeople and merchandisers.

Vardhan says these programmes are conducted with the aid of “outsourced qualified retail training professionals” and Nikai’s own product and marketing teams.

“Ensuring sales staff are fully briefed about your product portfolio is also crucial to protecting your brand image,” he says. “The more knowledgeable a salesperson is about a particular product, the more confident they are in their role, and that’s arguably the most important quality required when dealing with a customer and closing a sale.”

Vardhan says that demand for retail staff training services is greater in the Middle East’s more developed retail markets, particularly those in the GCC.

“In terms of specific market segments, we deal mostly with the major hypermarkets and multi-brand consumer electronics retailers,” he explains. “Intense competition between these operators means that quality training services are not merely a ‘management practice’, but a prime necessity in ensuring a competitive edge.”

This intense competition has also impacted the retail distribution sector, with channel players extending their portfolio of services to include extensive retail training programmes and after-sales support in a bid to gain an advantage over their competitors in the marketplace.

Jita Singh, product manager for Dubai-based ITE Distribution, which represents a range of brands in the Middle East including smartphone vendor Palm, says retail staff training services have become a crucial element in the company’s commercial growth strategy.

“As a distributor, our obligation to our vendor partners is to ensure retail sales staff receive the proper training covering their entire range of products,” she says. “The vast majority of our vendor partners are not located in the Middle East, so they rely on us to get their message across to retailers.

“Furthermore, every proposal we put forward to a potential new vendor partner includes a strong focus on retail staff training.

“It is a fundamental requirement that vendors demand when negotiating a new deal with a distributor.”

Singh says ITE conducts training programmes for its major retail partners across the region at least once a month, and employs product managers to manage either key brands or products in its distribution portfolio.

“Most of our training programmes target power retailers and typically focus on the key selling points of our product range,” she explains. “We showcase the latest products from our vendor partners and provide sales staff with helpful information including technical specifications and any other key features.

“We try and involve our vendor partners as much as possible in the training schemes, particularly sales managers from these companies.

“We also conduct mystery shopper tours on a regular basis in a bid to gauge how knowledgeable retail sales staff members are about our products.”||**||Unique demands|~|Bennett,-Bradley200-.gif|~|Bradley Bennett, business development manager for UAE-based consumer electronics power retailer, Plug-Ins Electronix.|~|Singh says ITE provides these services to retailers mainly located in the UAE, Bahrain, Saudi Arabia, Qatar, Oman, Kuwait.

The company also employs country managers who are charged with the task of coordinating sales programmes with key retailers in these markets, she adds.

“Each country also demands its own set of unique requirements in terms of training,” Singh explains. “For example, Oman’s retail sector isn’t as developed and its consumer market isn’t as sophisticated as Kuwait’s or the UAE’s for example. So, in the case of the former, we typically arrange for a retailer to visit our offices to be briefed about the latest products, whereas in the other countries we employ dedicated training staff who visit sales staff on the shop floor.

“We see huge growth potential in the power retail sector, so this has become our core focus. Consumers are increasingly flocking to these retail outlets, which makes it hugely important that we get the sales pitch right on behalf of our vendor partners when dealing with these retailers.”

According to Bennett, consumers are becoming increasingly savvy when it comes to new product releases, which is forcing retailers to lift their game when it comes to staff training.

He says that as a result, Plug-Ins now insists on regular briefings from vendors and distributors regarding the key technical features of new products released on the market.

Singh concurs with these sentiments, but claims that as most new products are supplied to retailers with technical details supplied as part of the packaging, the “sales pitch doesn’t really hinge on these details”.

“Most consumers are very aware of the technical specifications they are looking for when shopping for certain products. In these cases, the onus is on the salesperson to have a thorough knowledge of the various products available and their respective features,” she says.

“The challenge lies in ensuring that sales staff understand all the features of a particular product and can explains the real-world benefits to consumers.

“For example, whenever we conduct a training seminar on behalf of Palm, the company arranges for a sales manager to come and explain the key selling points of its product range to retail sales staff.

“The sales manager also works on the shop floor in conjunction with these staff, explaining the benefits of Palm handsets to customers. In this way, retail sales staff not only receive on the job training, but also develop a real-world appreciation for the capabilities of the product in question.”

Dubai-based mobile handset, accessories and IT-peripherals distributor SourceIT also sees value in providing quality retail staff training services.

Company director Chris Rae claims one of the main issues hindering the continued development of the regional consumer electronics retail sector is the inconsistent approach of many retailers to branding, staff training and after-sales support.

“The main issue facing the retail industry in the GCC at the moment is consistency, whether it involves presenting a particular product on the shop floor or the approach of sales staff to selling that product,” he says.

“Many retailers don’t stock a consistent range of products across their retail network, which often confuses the sales pitch from store to store.

“Greater emphasis needs to be placed on developing centralised buying processes, to ensure that every sales person employed by a particular chain is aware of the various products available.

“The current situation is very political, as some of the biggest retail brands are under agency control, which creates a situation where certain retailers only stock products from a particular vendor.

“Many retailers are losing out on potential business as a result of this situation.”

Rae says SourceIT adopts an all-encompassing approach to dealing with its retail clients on behalf of its vendor partners.

“Rather than just distributing a particular product, we’re working to impact the sell-through potential of that product,” he says.

“We cannot always rely solely on the good will of retail sales staff to promote our products because most retailers are multi-brand outlets. We also specialise in ‘box bundling’ to differentiate our offerings from those of our competitors, which provides sales staff with an added incentive to promote the sale of our products.

“As a distributor, it is very important that you make these incentives available, because it provides sales staff an opportunity to explain the added benefits of a particular product bundle.”

Rae says SourceIT works with “all the major retailers operating in the Middle East region”.

“They provide us with economies of scale in terms of offering training services, because of the significant number of sales staff they employ across all of their outlets,” he says.

SourceIT also offers after-sales service support as part of its distribution package. While the company operates a service centre, Rae is quick to point out that it “does not necessarily have contracts with vendors to service the products”.

“We act as a buffer between our customers and the retail service provider to ensure if a product is returned damaged, the customer receives the appropriate service support,” he explains.

“In terms of broad-based distributors operating in the Middle East, we’re the only company to offer this type of service without specific contracts with vendors.

“We don’t make any money by offering this service, but we hope it will garner loyalty with retailers, with a view to securing service contracts with key vendors in the future.”

Rae’s business partner and SourceIT director, Ahmed Al-Azzawi, says after-sales service is another area that needs to be fundamentally addressed in terms of staff training in the Middle East.

“There are many misconceptions among retail sales staff about after-sales support,” he says.

“There is a general reluctance to provide quality service post-sale, because many companies view it as a cost centre. They fail to realise there is money to be made in this sector.

“In most cases, poor after-sales service severely impacts any loyalty or good will that may have been established with customers at the point of sale.”||**||

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