Germany’s Thomann Opens U.S. Office
...customers throughout the European Union. The retailer’s slick, multi-lingual website listing nearly 87,000 products, coupled with unsurpassed logistics capabilities and generous return and warranty policies, have made it both a customer favorite and a fearsome competitor.
Having systematically expanded its reach from Germany to all 27 member states of the European Union, this year, Thomann has ventured across the Atlantic to open a U.S. office. Retailers will no doubt breathe a sigh of relief to learn that the new Albany, New York operation will not be selling goods to American consumers. Rather, it is charged with improving communications with U.S. suppliers and monitoring local market trends. Chris Smith, who heads the operation, previously directed export sales for Samson Technologies and is a trained orchestra percussionist.
Smith stresses “facilitating better communications” as he describes his role at Thomann International. The routine process of aligning supplier production and promotional schedules with Thomann’s marketplace needs is one element of the process. “Working more closely with our key vendors to better serve our customers in Europe is key,” he explains.
Another important function entails monitoring U.S. consumer trends, whether it’s the renewed interest in analog synth modules or the unexpected popularity of effects pedals. Smith notes, “The U.S. market is usually about six months ahead of Europe. By watching what’s happening here, we can get ahead of the curve in Europe.”
The most intriguing facet of Thomann’s U.S. operation is the unusual service it is offering to U.S. suppliers. Given its significant market share in countries representing 70% of the total European population, Thomann’s trove of sales data offers unmatched insights into the continent’s product preferences. Smith will offer key U.S. suppliers access to this data to help them refine product and marketing strategies for the European market. Information on hot selling price points, compelling feature sets, and trend lines that reside in Thomann’s sales records are the music industry equivalent of “big data and analytics,” he says. “Google and Amazon use this to run their business. When we see untapped potential in Europe we’ll offer U.S. suppliers similar tools,” he adds.
Smith has firsthand experience with the power of Thomann data. He says that during his tenure representing Samson Technology, the opportunity to peruse Thomann’s market data was “eye-opening.” “It was a total win-win,” he adds. “Seeing exactly where we stood in the market helped guide significant improvements to our line. And Thomann ultimately benefited with better sell-through.”
Musikhaus Thomann prides itself on being a customer-centric organization, hyper-focused on the needs of the buying public. Product managers continually monitor purchasing patterns as they make inventory and promotional decisions. Smith says of the team, “they are incredibly detail oriented, and they can tell you if a product is ten Euros or two knobs away from being successful.” By sharing this wealth of information with suppliers in the U.S., the company goal is to help them create the products that will better meet the needs of Thomann’s customers.
Although Thomann is solidly based in Germany, it maintains foreign offices throughout Europe to stay abreast of market trends. Hans Thomann explains, “We sell and purchase throughout an entire continent, but we know that it is crucial to have an understanding of the various national/local markets we compete in. That’s why we have hired natives from the countries most of our customers and suppliers hail from, so that these suppliers can deal with us as with a local company.”
Hans Thomann has a special relationship with the U.S. market that dates back to the formative years of his company. In the early ’80s, he began traveling to New York to personally select the best-playing guitars he could find. Bringing them back for resale in Germany established his reputation as a premier destination for superlative guitars. Reflecting, he says, “I visited the U.S. for the first time when I was 18 years old and was blown away by the creative and innovative spirit I found in the music scene at the time. I have remained impressed to this very day. I believe that a physical presence in the largest and most vibrant music market will facilitate our understanding of the industry as a whole. Having someone dedicated to keeping an eye on developments in the world’s largest consumer market and anticipating changes is crucial for us, since we are the world’s largest e-commerce m.i. retailer.”
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