BENTONVILLE, ARK. - A renewed focus on nationally known brands, the addition of sound bars, and the installation of interactive displays for a variety of CE products, including home-theater audio, are driving Walmart's increased aggressiveness in home audio.
theater audio to TVs] in a self-service environment," said Stephen Baker, The NPD Group's industry analysis VP
At the same time, the company has scaled back its selection of legacy audio products, such as headphone CD players and boomboxes, although "probably more gradually than other retailers" because a segment of Walmart's customers continues to purchase these products, Baker said. The chain remains "pretty aggressively SKU'd" in MP3 players, including iPods, he noted.
To boost the attachment rate for home theater in a box (HTiB) systems and sound bars, the company is rolling out interactive displays that let customers turn the products on and play music through them. Neither type of system, however, is displayed in the higher-traffic TV-display area, where some suppliers said the systems would benefit from greater exposure. Like many of its competitors, suppliers noted, Walmart displays all the speakers of a demo-capable HTiB in front of the consumer, precluding a true surround-sound demo.
Interactivity in the revamped CE departments also extends to portable navigation devices (PNDs), Blu-ray players, cameras, cellphones and other portable electronics, including headphones and MP3 players, said a Walmart press release.
The audio selection, like the CE department as a whole, reflects a renewed push in the past few years to increase the percentage of nationally known first-tier brands in the stores, multiple suppliers also observed. About six years ago, one supplier said, Walmart appeared to reverse a slow-but-steady migration to better-known brands by expanding its assortment of Durabrand house-brand products in audio and other electronics, "but they moved off this pretty quickly" because of the shift to digital technology, the marketer said.
Walmart shifted back to a branded focus, the marketer explained, in large part because Durabrand's OEM suppliers couldn't deliver the latest digital technology as quickly as top-tier suppliers could. "Digital technology was moving too fast," and Durabrand's OEM suppliers put Walmart in the potential position of "buying last year's technology," he said. "The top-tier brands became stronger because they could deliver these technologies."
The chain also moved away from the Durabrand house brand to keep return rates under control, the marketer said. "When TVs began shifting to digital, the new technology had challenges," he said in citing one example. "There were challenges even for the top-tier display manufacturers. To try to do this with OEM suppliers would have been a disaster."
With its renewed focus on leading brands, Walmart's HTiB selection includes models from Sony, Samsung, LG, Philips and RCA at price points ranging from $98.96 to $398, based on a walkthrough of the company's relatively new Riverdale, N.J., store. Five HTiBs could be demoed live at eye-and-ear level, and six other models were stacked on shelves below in their boxes.
Two sound bars were also connected to interactive displays, with a Vizio model at $99 without subwoofer and a Samsung model at $298 with included subwoofer.
Six iPod-docking speakers systems and clock radios on display ranged in price from $39.98 to $149 from Memorex, iHome, RCA, Sony and Philips. The MP3-player selection included Microsoft's Zune and models from Philips and RCA. Sony MP3 players, though not visible at the store, are part of Walmart's mix in other stores.
For legacy-type portable audio and tabletop stereo products, the Riverdale store displayed boxed products stacked on shelves and hung on display boards in a 20-foot-long display. The products included three headphone CD players up to $39.72 from Memorex, Philips and Sony; Sony belt-clip personal radios; two Sony voice recorders; six clock radios from Emerson, Sony and RCA; four CD-playing shelf systems from Sony, Philips and GPX at up to $197; and seven CD boomboxes priced up to $49.87 from GPX, RCA, Emerson, Memorex and Sony.
The display also hosted two transportable satellite-radio tuners with included car-mounting kit at $59.88 each.
The chain also offers Sony e-readers, which along with PNDs were displayed near the cellphone area.
The audio selection and price points reflect Walmart's position in the market, said NPD's Baker. "Typically, Walmart is not going to have as complete a selection as CE specialists because of a lack of space, so they focus on driving volume in high-volume products," he explained.