In CE, Innovation Is A Given
By Steve Smith -- TWICE, 11/9/2009
Recoton and Delco announced they would manufacture satellite-radio receivers from CD Radio, the company that later became Sirius and merged with XM. Zenith introduced its new line with an emphasis on refocusing its direction under its new parent company LG Electronics. Sony said it was preparing to introduce a Super Audio CD deck in Japan for 500,000 yen ... and at the same time TWICE decided to boost its coverage of “computer and convergence technology.”
Those were some of the headlines from TWICE's on April 12, 1999, one issue before our 1999 Top 100 Consumer Electronics Retailers list was published.
Now, it is always interesting to take a look back 10 years and see how things have changed. But in this industry, at the end of what has to be labeled “the digital decade,” we felt it was more than just nostalgia to take a look at the changes in CE retailing in our TWICE Business Annual (see p. 27) by reviewing our Top 100 lists circa 1999 vs. 2009.
Of course retail was just one of the major changes in this industry during the past decade. Due to the emergence of digital technology in CE — or, as TWICE called it back in the late 1990s, “convergence” — every category from TVs to portable audio moved from analog to digital or ceased to exist. And plenty of other categories, too numerous to mention here, were created.
The industry's leading suppliers and manufacturers also changed. Some that were second- and third-string players saw digital technology as an opportunity, reinvented their brands and products, and are now market leaders. Newcomers that didn't exist back in 1999 emerged with innovative products and created all-new categories. And some others that were market leaders in the analog era are now either treading water trying to compete or are out of the business, with their once-leading brands being owned by other manufacturers.
The lesson from this most-lucrative and volatile of decades for the CE industry is simple: Innovation is a given, not a choice. That holds true whether you are a manufacturer, retailer or distributor. To continue to succeed in this industry you can't stop and admire your market share and cut back on investing in your business. If so, you will be out of business.
Some have said that with the DTV conversion behind us and with many top CE categories maturing that the industry's innovative days are behind it.
Granted, the next year or two might turn out to be an evolutionary rather than a revolutionary phase. (After all, how many times do you come up with flat-panel high-definition TVs, MP3 players, smartphones and the like?)
But to sit back and wait for the next wave, you do it at your own peril in this business. You might miss 3D TV, the move toward more environmentally friendly products, or technologies we haven't heard of yet.
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