DigiKey’s vice president of global business development, Mike Slater, offers engineers and designers a mid-year look at the electronics distribution market.
The distribution market is in an interesting spot right now. We know the industry is amid a down cycle, and we’re seeing a lot of activity right now because when the industry slows down, people get aggressive about innovating and trying to come up with new products and solutions to stimulate demand.
We expect to see signs of further design activity, with more new product introductions and projects coming to fruition toward the year’s midpoint. Hopefully, by the end of the year, we will see reasonably increased demand for electronic components as technology evolves.
One of the top benefits of being a private company is that we can plan for these downward market cycles while operating toward a longer-term strategy.
Many key vertical markets in Europe will develop further this year, including renewable energy, electric vehicles, cellular networks, IoT and artificial intelligence (AI).
Supporting market action in Europe
DigiKey continues to invest in our infrastructure, systems and inventory to support all our European customers over the next few exciting years in our industry. Our purpose in EMEA is to accelerate progress for engineers, designers and buyers while making interactions with DigiKey easy and efficient.
We offer our European customers the world’s largest selection of electronic components in stock and available for immediate shipment, and we can get products into the hands of customers in Europe in as little as 48 hours. DigiKey wants to seed the EMEA market with the latest new product introductions from European suppliers.
DigiKey has very specific supplier criteria and requirements, including product quality, brand authorization, compliance with industry standards, reliability, liability insurance and the ability to meet customer demands.
Reliable and ever-evolving services
Beyond the products that accelerate technology innovation, DigiKey also supports engineers with a wealth of digital solutions and tools to make their jobs more efficient. We publish hundreds of articles, blogs, webinars and videos on our website, www.digikey.co.uk, and we have other digital assets, such as our TechForum for problem-solving and Maker.io site for projects and ideas.
We have also launched an Innovation Hub as a web immersive experience to help introduce engineers and designers to DigiKey and our products and services. We also recently launched a new webpage dedicated to the Industrial Sector, which focuses on solutions for robotic arms, AGVs and conveyor belts.
DigiKey continues to invest in more robust and predictive web search functionality, higher inventory levels and increased automation in the DigiKey warehouse, which all benefit customers by providing an easy and efficient research, shopping and delivery experience.
Coming trends and strategies
Wireless connectivity, industrial automation and electrification, smart sensors, cross-architecture solutions and rapid prototyping are all key technology trends this year. The most talked-about trends recently are related to AI and data. Many companies are starting to scratch the surface and try things that have the potential to significantly change the way we do business long term. We’re excited to help engineers, designers and makers accelerate progress in these spaces.
In Europe, we continue to see clean automation and control, energy, automotive and transportation, electrification, and aerospace perform well. In the long term, we are very optimistic that the electronics business and industry will continue to proliferate in areas we have not seen in the past.
We want to emphasize how important the European region is to DigiKey. This area always drives innovation and demand. This year, we are laser-focused on superior execution and customer experience for our European customers.
Last year, we added considerable inventory depth to offer the industry the widest product availability for immediate shipment and are thrilled with the customer response. We closed Q4 2023 with more than 10% more new customers than in Q4 2022. The customer growth we experienced at the end of 2023 corresponds directly with increases in new design activity we saw earlier in the year and is a positive sign for DigiKey’s and the overall industry’s future.
Business goals for the rest of 2024
For the rest of this year, we plan to build upon our foundation of high-performing teams, strong digital strategy and superior operational excellence, which will together drive our growth in inventory, eCommerce, supplier services, and new markets and geographies.
With those strategies in place, we expect to grow our revenue and annual customer count, expand our market share, and become increasingly scalable.
All those advancements benefit our European customers and future customers, and we look forward to exceeding their expectations in 2024 and beyond.