By Lisa Johnston
New products on display at the American International Toy Fair, held in N
What do you think of when I say “Honda”?
For many, cars will no doubt come to mind, at least when it comes to products. Many others will think motorcycles, and a few may conjure images of outboard engines.
There will also be adjectives modifying these products such as “quality,” “reliable” and “value,” along with a few not so flattering terms.
All of this, coming from a stratified, representative sample of consumers, serves to create what we refer to as the “brand landscape” for Honda — a “picture” if you will of how the Honda brand appears to consumers, including the picture consumers have of Honda's competitor brands.
This is very useful stuff to any company as concerned about its brand as Honda, and it should be to you as well.
Unfortunately, with very few exceptions, many of the current CE “pictures” are not pretty.
What we commonly call the CE industry has diametrically opposed goals of selling high(er) technology at the lowest price possible. This did not happen purposely. There was no meeting at which a decision was reached to emphasize price over performance, but it has happened nonetheless. The effect of this is far reaching, including — obviously — profit. Nevertheless, how much money is or is not made is merely a byproduct of many other things, the “brand landscape” being just one of them.
It makes sense if you think about it. It is hard to expect a consumer to put “quality” on the CE brand landscape after seeing $29.99 DVD players.
The 2005 Coyote Insight Dealer Audit (CIDA) study for home audio points to what we believe to be a major shift in the brand landscape for home audio products as seen by retail sales floor management (yes, there is a brand landscape among merchants as well). We see brand compression in the sense that retail sales floor management is elevating certain premium brands such as Yamaha and Denon, along with some at the lower end (RCA), while de- emphasizing, or compressing, many others.
This is partly in reaction to the difficult market conditions that is the reality for home audio. However — and this is important —it is more a case of self-fulfilling prophesy, a reality contrived by retailers as opposed to consumers. To be sure, in time consumers will create their own new brand landscape, but at this point they are still reacting more to what they see (and do not see) at retail as opposed to indicating what they would like, and retailers need to be careful about their role in this process. Placing too much or too little emphasis on individual brands ahead of consumers forming their own views can result, and we believe has resulted, in missed opportunities.
Some retailers reading this might conclude what they believed all along, i.e., that they decide the fate of CE brands and not the manufacturer. No doubt retailers do play a major role in manufacturer brand landscape positioning, but their decisions and actions regarding the brands they will and will not emphasize also serve to determine their own position as well. Well-executed home theater merchandising says one thing, while a stack of $29.99 DVD players at the door says something else altogether.
I've been around this industry for over 25 years and am disturbed by much of what I currently see. We've gone from offering excellent products from respected manufacturers and retailers to, well, less than that. However, nothing is forever, and there are signs of change for the better, coming from what I believe to be the nucleus of a CE renaissance.
Does what you are doing determine whether you are a part of that? Yes, and as a Knight of the Order of the Grail said to Walter Donovan in “Indiana Jones: The Last Crusade” as he decided which chalice was the Holy Grail: “Choose wisely, as you consider what you will do.”
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.