Whenever top CE brands get together with a national retailer to, basically, jumpstart a vital new technology for the industry, you should expect howls of complaints from independent retailers.
Well, times have changed I guess because news earlier this month that Best Buy, LG, Samsung and Sony are working together on a 13-week Ultra HD consumer awareness campaign called “Believing Begins Here,” which has input from the Consumer Electronics Association, wrought a surprising reaction.
Three top retailers I spoke with support the initiative and think it will really help independents. Maybe it is because these retailers have had a chance to sell Ultra HD the past couple of years, unlike the rollout of 3D several years ago. Or maybe the need for this new technology to succeed far outweighs the usual competitive concerns.
Whatever the reason, the executives I spoke with wholeheartedly supported the effort.
Dan Pidgeon, chairman of Starpower, said that Ultra HD is “bigger than any retailer or manufacturer. The more promotion and awareness by anyone and everyone is welcome.”
Video & Audio Center in Southern California introduced Ultra HD in the U.S. and Tom Campbell, corporate director, said, “I am thrilled that Best Buy is embracing [Ultra HD]. [The promotional effort] will help everyone.”
Campbell noted that the independent channel “still has many strong retailers,” but that independents “alone cannot drive Ultra HD. [Best Buy] will help, not hurt, our channel. It will give Ultra HD more credence.”
In fact, as consumers learn more about Ultra HD, they will have more questions, and these executives believe that consumers will turn to independents for answers, installation and service.
Dave Workman, president/COO of ProSource, a division of BrandSource, told me that industry studies show that 37 percent of unaided consumers expressed an interest in Ultra HD without seeing the product, “but that number jumped to over 70 percent when the product had been demonstrated to them.”
He added that without Best Buy “onboard for demonstrating the product,” there would be “inordinate amount of pressure to even further reduce pricing to create demand, thus cannibalizing existing TV sales.”
And Workman stressed that another advantage of the program is that “it is being done with tier-one vendors and will help blunt some of the tier-three brands” from lowering prices dramatically.
Pidgeon commented that if manufacturers “remained disciplined” about the pricing of Ultra HD, “independent CE retailers should fare extremely well. I think we have all learned that the ‘race to zero,’” when it comes to pricing, “destroyed many good manufacturers and retailers.”
Expressing confidence in the independent channel, Pidgeon stressed that these retailers are able to bring “more credibility and positive consumer experiences than any that can be obtained at big-box retailers.”
The Starpower exec added, “The independent CE retailer will gain from the increased presence [of Ultra HD] as there is quite a bit more than price involved in making a purchase” of this type.
Steve Smith was the longtime editor in chief of TWICE and is now editor at large. He can be reached directly at [email protected].
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