twice connect
careers

Walmart Expanding Online Component-Audio Selection

6/07/2010 09:14:00 AM Eastern

BENTONVILLE, ARK. - Walmart.com expanded its online selection to
include component audio about a year ago, suppliers told , and more
component brands are on the way.

Many of the component-audio products hail from audio specialty
suppliers, and as of early June, their products included component in-room
speakers up to $1,999 each, turntables, a stereo receiver, an HD Radio tuner,
an in-wall speaker and multiple outdoor speakers. AVRs were priced up to $278.

Brands represented on the site included BIC, Cerwin-Vega, HiFi
Works, Klipsch, Numark, OSD Audio, Pinnacle, 
Sangean,  Sony and Teac. Wireless
speakers were available from Acoustic Research, Mutant Audio, OSD Audio and
Cables Unlimited.

All of the products werTWICEe available for shipment direct to a
consumer's home, or they could be shipped free to a nearby Walmart store for
pickup seven to 10 days after ordering. None of the products was available on
store shelves.

In coming weeks, the component selection will expand further with
the addition of components and other home audio products from audio-specialty
supplier Onkyo, whose lineup will include five A/V receivers, two home-theater
receiver/speaker packages, two home-theater speaker packages, and a 2.1-speaker
virtual surround system with A/V receiver embedded in the subwoofer. A mini
system and iPod dock accessory are also planned. All Onkyo A/V receivers and
home-theater systems sold through Walmart.com will be priced below $499, and
none was to be shipped to Walmart stores for customer pickup.

Other audio specialty brands could be on the way. Onkyo national
sales manager Joe Petrillo commented in an email to sales reps and key
accounts, "Our competitors are and have been in negotiation with Walmart.com as
well."

Another audio specialty supplier summed up the appeal this way:
"It might not pop into people's minds to go to Walmart for speakers, but if
they are on Walmart.com buying a TV and run across component audio, they're
making those purchases." Consumers, he added, "have gotten very comfortable
buying audio online," particularly if they have "trust in the site as a brand
that will be around."

Onkyo foresaw multiple benefits to bringing 12 products, some of
them derivatives, to Walmart.com.  In his
email, Onkyo's Petrillo contended the new distribution channel will expose the
brand to more consumers and drive many of them to other authorized online and
brick-and-mortar dealers to buy step-up Onkyo products.

Also in his email, Petrillo contended the relationship would not
dilute the value of the Onkyo brand, nor would it create channel conflicts.

"Based on the current average assortment of our key account
partners, I don't feel that the models selected will create a conflict," he
said. "Instead, I believe it provides you with a very solid step strategy."

The new distribution channel won't dilute the value of the Onkyo
brand, he added, because "a ‘brand' loses its prestige in the marketplace when
the products being produced are compromised from a build quality standpoint, no
longer offer any demonstrable benefits vs. the competition, and lastly carry no
‘real' perceived value to the consumer. None of these circumstances are present
here."

Not all component-audio products sold on the site, however, are
actually sold by Walmart, several suppliers said. In some cases, the product is
supplied by a third-party online retailer, they said.

Whether component audio will eventually come to Walmart's
brick-and-mortar shelves, however, is another story. "We will watch what's
selling at the clubs [Sam's Club] and atWalmart.com, and we'll let the customer
decide whether we will bring component audio into the stores," CE VP Kevin
O'Connor told TWICE.

In its early June online selection, Walmart offered three Sony
and Teac A/V receivers up to $278, a Sony stereo receiver, Sangean's component
HD Radio tuner at $198 and a Numark CD player at $199 The site's selection of
49 component speakers included in-room floor standing and shelf speakers from
Sony, Klipsch, Cerwin-Vega, Pinnacle and BIC up to $1,999 each (not per pair)
for Cerwin-Vega towers with built-in powered subwoofers. Klipsch offered a
$149-each tower speaker on rollback, though it is normally sold for $274, the
Web site said.

The speaker selection also includes wireless speakers from
Acoustic Research, Mutant, and OSD Audio; outdoor speakers from OSD, Cables
Unlimited and HiFi Works; and a BIC in-wall speaker.

The site also offered multiple turntables, but all were either
designed for DJ use or for converting vinyl records to MP3 files or to
recordable audio CDs.

PHOTOS
ProSource Meeting Filled With Optimism

San Antonio — Optimism reigned at ProSource’s

Ingram Draws 500 To Spring Vendor Expo

Scottsdale, Ariz. — Ingram Micro Consumer

CEA Holds ’14 Digital Patriots Dinner

Washington — CEA held its annual Digital Patriots’

8 Technology Accessories For a Greener Earth

An Earth Day review of Earth-friendly products, by

BrandSource Shows Diverse Product Selection

BrandSource’s Summit show at the Marriott World

Scenes From Toy Fair

By Lisa Johnston

ADL Honors Morales, Bilas, Paull, Weedfald At Annual Dinner

New York — The Anti-Defamation League’s National