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What’s Wrong?

TWICE: What are some of the merchandising mistakes that retailers continue to make in merchandising component audio?

Harman: One of retailers’ biggest mistakes is in believing they still need a “mix-and-match” audio wall. The improvement to their audio business will come as they move away from this and give consumers easy choices for complete home theater audio solutions. Retailer merchandising should deliver a clear message that the home entertainment experience is an integrated experience that incorporates great audio as well as great video.

The single biggest mistake that we have observed in merchandising is what we refer to as the “lineup” — home theater systems and pure audio systems that range from $300 to $3,000, all lined up and displayed the same way with the same signage. No demo, no differentiation, no value — and no sales.

Customers will spend more money if they are provided with the right environment, the right information, the right demo and a feeling that what they’re looking at isn’t all the same stuff.

David Kroll,Boston Acoustics: Too often, it seems the systems retailers choose to display are not easy to use. Too often, they lack integrated remotes or controls that allow salespeople to demonstrate them successfully or easily. Too often, retailers do not help consumers understand what an easy, enjoyable experience they can have with a product or system once its home.

Systems on display must not only look and sound good but also give consumers confidence they will be able to operate them back in their homes. Consumers must be comfortable with their ability to use the equipment once it’s home.

Many retailers train their sales teams on the features and benefits of various systems but neglect the art of the demo.

Tassio: We suggest that dealers more aggressively integrate component audio with their video displays, and vice versa, to benefit from cross-pollination.

Another mistake that we’re seeing is dealers de-emphasizing “brand” in their advertising and merchandising. When consumers are confused and overwhelmed by technology and choice, they rely on brand names and reputation to make choices.

In addition, traditional soundrooms remain confusing, intimidating places, and we’re not surprised to find them empty even when the rest of the store is busy. Dealers should consider product groupings and signage that help the consumer make sense of the vast number of disparate components in the soundroom. Grouping speakers by brand along with strong educational signage would be so much more helpful to the browsing consumer rather than the seemingly random distribution of gear that one commonly finds. Store personnel should be instructed to keep a hot demo scene endlessly running in every soundroom to bring consumers in.

Dealers would also be well-served by focusing on the blocking and tackling issues of salesmanship — starting with giving exciting demos. I’m afraid it’s a lost art in too many retail locations.

Abram: Walls of components or rows of shelves with black (or silver) boxes do not help consumers understand why they should buy audio, unless it’s a replacement purchase. Application stories need to be developed to bring consumers into the audio section and then fully explain the value/benefits of new audio technology. Vignettes, lifestyle settings and solutions for specific home theater needs should be displayed.

Jacobs: There needs to be a much simpler path for consumers to experience the difference between cheap HTiB and the quality alternative. We hear far too many consumers tell us they don’t even get to audition the good stuff.

Sandy Gross,Directed Electronics:One of the keys to effectively merchandising component audio is to make it really perform on the sales floor. We have seen many retailers fall short in this regard. The styling may be the sizzle, but the performance is absolutely the steak, and this must be clearly and easily demonstrated

Making the decision easy for the customers is also important, so system packages work great as well as provide logical and easily perceived step-up options.

Stollmack: In too many stores, the systems rarely work correctly when the salesperson actually tries to play them. I find this to be particularly the case when the demo is being done is a room with a switching system to compare speakers. If the salespeople cannot rely on the demonstration to work virtually every time, they simply will not take the time to give their customers demonstrations.

Specialists must be able to give a compelling demonstration to potential customers. It was not that long ago that nothing really looked good in a big-box environment. Because those stores now show HDTV and high quality DVDs exclusively, AV specialists cannot rely on a better picture to differentiate our stores. We need to use speakers and receivers to allow us to deliver a unique experience, which is the main competitive advantage of the specialist.

Too many stores are not merchandising the custom products they sell. Virtually every customer is a potential user of distributed audio and in-wall or outdoor speakers. It is much more impressive if they actually can see the equipment operate than if they are told how about how it operates.

I have had salespeople tell me, “ I can’t tell you how many systems they have sold without giving any demonstrations.” I always ask them if they can tell me how many sales they’ve lost because they did not do a demonstration.

iPod! iPod! iPod! The A/V specialists are completely missing the boat on a great opportunity. Every store should have an iPod set up with an A/V system. Customers are buying iPods in record numbers because they love the flexibility and the ability to have their music with them in many situations. We should be showing them how to enhance the use of their favorite piece of equipment.

DVD-Audio and SACD are rarely used by salespeople. This is a lost opportunity. Customers are not knowledgeable about these technologies. They can be included in most systems for virtually no additional charge. They provide the best musical demonstration we can provide. Customers are immediately impressed when they hear a favorite song in these formats. They love hearing music come from the surround speakers.