Capitol’s Kussard On Changes In A/V - Twice

Capitol’s Kussard On Changes In A/V

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NEW YORK — Retailers and custom installers have to change to find their way in this new economy.

In addition, residential systems contractors have to go out and sell customers rather than just take orders, and 3D TV sell-through rates are at the same pace as top-of-the-line HDTVs of the recent past.

These were just some of the observations of Jeff Kussard, strategic development director of Capitol Sales, the CE distributor that serves retail, custom installation, residential system and premium incentive markets.

Kussard, on a media tour to discuss Capitol adding Sherwood America’s Sherwood and Newcastle brand audio/ video receivers (AVRs) — and its revamped website,

www.capitolsales.com

– — talked about the changing specialty A/V market.

When asked what discussions between suppliers and retailers might be like at CEDIA Expo in Atlanta next month, Kussard said, “Many of the discussions will be about the economy rebounding. Have we reached a bottom and begun to climb? Or have we reached a bottom and are just sitting?”

Addressing the residential systems market, Kussard said, “I hope they realize that they can’t look for the return of the housing market as a savior. They have to redefine their businesses.” He said Capitol has stressed the No New Wires initiative for that market over the past two years, which “is a change for them but creates new opportunities, a new paradigm for the market.”

He noted, “Many in the residential systems market used new-home construction as a cash cow in the past decade. Their business plan was more ‘lead management,’ making connections with architects, real estate developers, etc. to get in on projects. What they have to do now is go back to selling services and packages to previous customers and making cold calls. They have to go out and begin selling again.”

As for the retail market Kussard said Capitol sees growth “with well-established e-tailers. Amazon.com and others are doing well. It is challenging for traditional brick-and-mortar A/V specialists.”

He noted that the “shift in consumer behavior” about buying online started when “the big boxes took market share and made the in-store demo irrelevant because they did them badly.”

However, Kussard noted that while national chains have made many consumers believe CE is a commodity “there is a market for the enthusiast, which is why I’m still optimistic” about specialty A/V, but they have to change their approach. “As Jeff Huber, past president of CEDIA, once said, specialists and custom installers need to become ‘technology concierges’ for their customers.”

And Kussard disagreed with the spirit of last week’s iSuppli forecast that shipments of Internet-enabled TVs will be the major selling point in selling TVs this year as compared with 3D.

“Three months ago I would have agreed with that, but now … there are only a few 3D [Blu-ray] titles out there. But [Capitol’s] sell-through sales rates for 3D versus top-of-the-line TVs in the past year and a half is the same. It looks like what consumers are saying is that if they want the best HDTV they can buy, they are buying for the future, and that is a 3D TV.”

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