Group Sees Profit Opportunities In Connected CE, Ultra HD TV

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LAS VEGAS – The trend towards networked consumer electronics systems, and Ultra HD, are providing the Nationwide Marketing Group and its new alliance partner Home Technology Specialists of America (HTSA) with plenty of opportunities.

Tom Hickman, executive VP of electronics and distribution, was all smiles during a press briefing at PrimeTime, saying, “It is a good time to be a CE retailer, especially with [Ultra HD] being very profitable” and the group getting strong double-digit gains in the category. Nationwide’s strength is in the 55-inch and larger TVs, and Hickman said, “We are chasing a bunch of good things in CE from now through 2017.”

Jeff Knock, chief commercial officer of Nationwide, offered that “premium TV is our focus [in CE] and our mix is critical,” and that Ultra HD sales have benefitted greatly from the Prepare To Share program.

Hickman agreed. “Our wheelhouse is premium goods.” Thanks to the alliance with HTSA and the new Home Technology Specialists Nationwide (HTSN) group, Hickman said, “We are chasing audio hard with HTSN, developing wireless audio solutions, and looking at innovation to drive share.”

With the 60 members in HTSA, “They can help us with their expertise and we can help them with our efficiencies.” He added, “We can develop best practices with [HTSA’s] help, to get sharper on installation.”

Dave Bilas, CEO of Nationwide, said that HTSA would not “expand membership by 20 to 30 percent,” explaining that they are an elite group. What Nationwide wants to do is “feed off of each other. … They can help us and we can help them.”

Hickman said the overall goal in CE is to “compete on price and crush on service. [HTSA] crushes on service. The alliance will help us be on the forefront of the industry.”

When it comes to selling and installing home-automation networks or the coming Internet of Things, Hickman said, “The holy grail is to install and service whatever you sell.”

While he acknowledged that cable companies, phone and other utilities may want to initially get into this business, “When our retailers make a sale and do an installation, we should be in position for those consumers to come to us to service their systems or expand them.”

In this new era of connected CE Knock said, “You just can’t buy these products off of a pegboard at a mass merchant and install them yourselves.”

The vendor landscape in CE is changing but Bilas noted, “Some will win and some will lose in this space. But we feel as long as you can take care of the consumer, we will succeed.”

Hickman said it will be Nationwide’s responsibility to, “manage the brand transition” because “we want to win on the service side” of the business.

When asked about the fourth quarter, Hickman said that as usual, the summer has been “soft” but “Christmas will come – early with sales. But supplies will be strong and price points will be bullish” with Ultra HD, smart TV and connected products like Roko leading the way.

As for UPP programs, Hickman said, “UPP is our friend because it stabilized margins. It definitely helped Best Buy” when such programs were introduced a couple of years ago. “It provides channel discipline … and it lets vendors recoup the dollars it spent on developing these innovative products.”


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