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Tablet Sales : Pulling Profits from Tablets

From traffic drivers to full solutions

April 2012 By Nancy Klosek

"Our strategy is very different from that of brick-and-mortar dealers," he said, adding that in-store buys are more impulse purchases, while people coming to the site are willfully searching for tablets. Popular attachments online are OEM-specific accessories. "If a customer comes into our site and buys an Asus tablet, they might also buy an Asus case or an Asus docking station," he said. "Tablet-specific keyboards are also extremely popular."

One of the upsides for brick-and-mortar retailers is that tablets often lead to add-on sales that go beyond traditional accessories, such as headphones and music-streaming solutions. "The home network is driving how and what is purchased, and what we can build upon," Barrett said, adding that Vann's sales staff works to include tablets as part of a larger solution.

"The biggest thing is asking people, 'What do you want to do with it, or what do you think you want to do with it?' We'll say to the client, 'So now, you've got your iPad, or your Sony Tablet or your Samsung. You'll want to hook that up to a quality DAC—a Peachtree Audio, maybe, or a Sonos system.' Selling that ecosystem is the add-on."

When it comes to online sales, Barrett agrees Web customers usually log in with a reasonable idea what they want. To help that customer in reaching a decision, Vann's leverages its vendor relationships by posting YouTube videos that show off a tablet's features and benefits. The retailers also use Facebook and other social media tools, but not necessarily to sell products. "Social media isn't about trying to sell something," Barrett said. "It's about getting them excited about whatever is coming out, about sharing a piece of knowledge with someone."

Retailers can approach tablet sales in the same way the approach notebooks or gaming software, said Doug Schatz, vice president of electronics merchandising for the Nationwide Marketing Group. The benefit of tablets is that they can jump-start a buying cycle.

"What they are really about is frequency of shop because the buying cycle for a tablet is pretty short from the time you buy your first to the time you buy your second. It's the same with notebook computers, as opposed to bedding or furniture or a refrigerator," he said. "So by engaging in those shorter-cycle businesses, dealers are getting to see their customers more. And if you're getting to see the customer more, you have the best opportunity to have the top-of-mind awareness with the consumer when they want to shop for another product."

Jim Ristow, executive vice president of the BrandSource/HES buying group, which has made most major Android tablet brands available to its membership since late last year, also stressed the term "ecosystem" in addressing the topic of tablet sales and margin generation. Group membership is comprised of traditional retailers and custom integrators, and both are using tablets in different ways.

"Some of the more promotional members are using some of the OPP (opening price point) product to help drive traffic and/or include it as giveaways for promotions. But some are using them to create branded ecosystems," Ristow said. "When they're sold as part of not just video but audio and complete solutions, the packages are very profitable. Those members understand that they are selling not just that device but a market basket. It's a Trojan horse that opens the door to opportunities to things like Control4, Sonos wireless whole-home audio and Apple AirPlay products." DS



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