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Meridian Posts Gains On Smaller Dealer Base

2/18/2011 02:08:49 PM Eastern

New
York - Meridian America significantly scaled back its dealer base and product
selection beginning in 2009 yet posted a 12 percent sales gain in 2010, CEO
Peter Wellikoff told TWICE.

Meridian
grew by focusing more resources on fewer, more committed dealers and by taking
more of a luxury position in the A/V market, he explained.

Meridian

With its greater focus on the luxury market,
Meridian brought in new staff with a luxury-market background and opened up its
U.S. headquarters here for use as a dealer showroom to demonstrate Meridian's
high-end audio and video products to high-level business executives, athletes
and actors who don't shop in retail stores, Wellikoff said. The company plans
to make this strategy "bi-coastal," he noted.

Meridian
also began to support dealers whose high-profile customers want a demo in their
own homes. For these dealers, Meridian flies out products and staff to set up and
demo a system in the potential customer's home and let the homeowner live with
it for a day. About 90 percent of the time, Meridian staff makes the
presentation to the consumer, but the dealer sets up the appointment and
profits from the sale. All home demos to date have closed a sale, Wellikoff
noted.

The
reduction in the U.S. dealer base began in late 2009, and by the end of 2010,
the company had reduced its 250 active accounts to 150, Wellikoff said. By mid
February, the company had pared more dealers, bringing the base to 120. And
more cuts could be coming. "We hope to bring it to 100," Wellikoff said.

"The
brand is better served by providing more resources to fewer dealers," he explained.
Meridian also entices to make "full commitments" to the brand, he said. Among A/V
dealers with retail storefronts, the commitment includes a Meridian shop within
a shop.

At
Stereo Exchange in New York City, for example, that means a Meridian A/V system
is set up along with an alcove dedicated to Meridian products with Meridian
signage.

To
reinforce its luxury position, a Meridian-branded autosound system
will appear globally this May in the Range Rover Evoque. The Meridian brand
already appears on sound systems in McLaren vehicles. "McLaren and Range Rover
customers are prequalified Meridian customers and vice versa," Wellikoff said.

In
paring its selection, the company reduced its SKU count to 30 from as many as 130 in 2007,
said Tim Ireland, CEO of U.K.-based parent Meridian Audio Ltd.

The
company, however, is gearing up to add at least one more product, a six-zone
Sooloos audio server that offers more zones and more output types per zone  compared to the company's other multizone
servers, said regional sales manager Ryan Donaher. The MediaCore 600 will be
Meridian's first multizone server with proprietary SpeakerLink output. Although
many specs haven't been finalized, the server will feature one analog output, one
coaxial digital output, and one SpeakerLink output per zone.

SpeakerLink
delivers
balanced 96kHz/24-bit digital audio and control signals over up to 300 feet
over CAT-5e RJ-45-terminated cable to the
company's active DSP
speakers, including
its active in-wall DSP speakers. SpeakerLink eliminates signal losses and
coloration induced by analog signals riding on a cable, and it simplifies cable
connections because Meridian DSP speakers can be daisychained to avoid
home-running cable from each speaker to a Meridian component.

The
server's target delivery date is late spring.

Meridian
is majority owned by Reinet, the investment division of Richemont, which
owns a portfolio of luxury brands. Those brands include Cartier, Van Cleef
& Arpels, Piaget, Vacheron Constantin, Jaeger-LeCoultre, IWC, Panerai and
Montblanc. Reinet upped its investment last year to a majority controlling
interest.

 "Having met and worked with some of their
senior staff, not to mention their enormous success in the luxury goods
business, I consider this a great move," said Wellikoff. "I've already started
to take advantage of some of their marketing resources." Meridian, in fact, is
investigating opportunities to cross-promote its M80 tabletop music system with
these other brands, he said.

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