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Dealers Enter a New Realm With Accessories

Definition of “add-on” gains new depth and breadth

June 13, 2013 By Nancy Klosek

Accessories are sales drivers and margin generators. But no longer are they just cases and chargers, cables and TV mounts. They are technology-enablers. That’s according to dealers, who are redefining and broadening the term by labeling as accessories products as diverse as soundbars, wireless RF headphones and even Blu-ray players.

Rocketing smartphone, tablet and large-screen TV sales and sharp increases in the numbers of available models have brought heavy demand for all flavors of cases, in-car accessories, cables and mounts. While dealers report brisk sales of accessories, they say the category has been facing margin pressures.

“Due to increased price competition from other online retailers, margins, while still healthy, have been slipping over the past few years,” said Fanson Zhou, director of product management for accessories at newegg.com.

Another problem faces retailers who are eager to capitalize on CE accessories.
Kamran Tehrani, director of purchasing at Video and Audio Center, Santa Monica, Calif., just brought on Samsung Galaxy tablets and related accessories to his mix.

But he has been wary of increasing his mobile accessories assortment because of the speed at which manufacture changes hardware designs, often without warning.

“There is such a fast turnover in the design of the devices,” he said.

That dynamic has made merchandising products like soundbars as accessories more important for some dealers.

“Our primary business is larger, more expensive boxes, so one could argue that less-expensive boxes are accessories,” said Alan Guyes, principal of Audiotronics, Roanoke, Va. “That’s how you could say a soundbar is an accessory sale to a television, just as a cabinet or HDMI cable is. Like other accessories, it’s the solution that people didn’t know they needed but really needed all along.”

The selection, price points, margins and quality of the products could make this the decade of the soundbar, Guyes and other dealers said. They point to such higher-end models by Definitive Technology, Sonos and Bose as examples of how a TV accessory can act as an entreé into selling a complete ecosystem of higher-ticket products.

“It’s kind of like Pringles; you can’t have just one,” Guyes said. “Once you do the soundbar, you want the sub and then the PLAY:3 in the bedroom, guest room, kitchen. It’s a sneaky, clever, wonderful product.”

 

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