Pulling Profits from Tablets
Online Vs. Brick & Mortar
But for some e-tailers, carrying a wide assortment is more of a blessing than a curse. newegg.com, for example, sells iPads and 29 Android-based tablets, with prices ranging between $149 and $599. “We’re essentially able to have unlimited ‘shelf space’ and carry more inventory,” said Bob Bellack, newegg’s CEO, North America. The e-tailer’s ability to use virtual fulfillment—keeping inventory housed at distribution centers as a way to maintain a high assortment with no inventory costs—provides further advantages.
“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 newegg.com 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.”