The number and variety of accessories available to all CE dealers has greatly increased exponentially in recent years. Ballooning mobile device sales account, in part, for the crowded peripherals market. But whatever the reason, dealers are grateful for a broader choice of options, and they say they are constantly on the lookout for new products, technologies and ideas that will stimulate foot traffic and boost their bottom lines.
New accessories are such important business drivers heading into 2013 because, for one, pricing competition within the most popular accessories categories has put strong pressure on margin points. “Margins are thinner nowadays,” said Simon Sedek, buyer at Electronic Express, Nashville, Tenn. “They used to be better. But there is more competition.”
Mark Shaw, electronics division merchandise manager for Nebraska Furniture Mart, agreed. “The biggest challenge in the accessory category is maintaining profitability, because we’re seeing a lot of price erosion and price-matching on the Internet,” he said. “Where once you assumed accessories would be profitable, if you’re tracking pricing on the Internet, they can soon become unprofitable.”
Short of suppliers developing stricter distribution policies or preventing discounting, dealers have had to look harder for unique traffic-builders. And they’re having to get more creative in executing merchandising and display techniques for every accessory category.
The traditional categories of TV stands, mounts and A/V furniture have seen a big sales bump of late, ironically a byproduct of heightened sales of margin-stingy flat-panel TVs. “In our 40-inch-plus screen sizes, there has been double-digit sales growth,” Shaw said. “People are buying new TVs and replacing the stands. And accessories relating to the TV category resurgence, including furniture, certainly, but also cables, have been doing real well.”
Steve Kleinschmidt, electronics buyer for Schaefer’s in Lincoln, Neb., said his store does not carry tablet accessories, bucking the general CE retail trend. Rather, the focus during the current store remodeling is on small furniture seating and couches, as well as popular wall brackets and TV stands. Schaefer’s Monster room, he added, is “still our place of the most accessory volume,” with its array of traditional cabling and headphones. With the renovation, the store will have a more open look that will lead browsers to the rear, where they will have better exposure to the audio department and a corner that features iPod/iPhone docking speaker systems.
Schaefer’s still sticks with the time-honored merchandising method of placing lower-ticket impulse items in the checkout area. One SKU displayed that way that really has legs is a $39.99 mini speaker from Boomz Audio that can play tunes from an attached smartphone or from a plugged-in SD Card. “It’s available in colors and is literally a little bigger than a D battery,” Kleinschmidt said. “People love it; they love to take it golfing for background music. It’s a nice price point and it’s sitting right up there on the front counter.”
Some of the best-selling accessories at Schaefer’s have little to do with pricing and much to do with providing solutions. They include all-in-one remotes, whose sweet spot is at a lofty $299 price point, which quickly sell when the features are thoroughly explained to the customer. “There are higher-priced ones, but that seems to be the price that solves most people’s issues so that they can refine everything down to one remote,” he said.
Beyond CE, Kleinschmidt said there’s profit in accessories that complement the store’s new bedding gallery, when pillows and SKUs from the Protect-A-Bed brand move out the door along with mattresses and box springs.
Bedding accessories might be on the docket soon at Electronic Express, as Sedek is testing out the furniture and mattress categories in several locations. For now, though, some of his hottest accessories sales are based on wireless technologies. “Manufacturers are focusing on Bluetooth, particularly on the audio side,” he said, citing Jawbone’s JamBox Bluetooth wireless speaker as a popular SKU. Devices that work with the Apple AirPlay protocol, such as JBL’s OnBeat Air speaker dock, are also selling well.
Audio systems with built-in Bluetooth are one of the strongest accessory categories at Nebraska Furniture Mart. “A lot of the docks and devices (mainly in the $99 to $199 range) are selling double what they did a year ago,” Shaw said. “When you say, ‘Hey, it’s got Bluetooth,’ customers a year ago didn’t understand what that meant. Certainly, there’s more consumer education that has to take place, but today a lot more customers are familiar with what that terminology means.”
Wireless device accessories such as smartphone/cell phone cases are also hot commodities, with people buying multiples and changing them out for fashion, just as they are doing with headphones, Shaw said.
Sedek, for his part, is capitalizing on another aspect of the smartphone boom by expanding the number of portable smartphone charger/backup battery products to nine models this year from last year’s three. He’s also embellishing gaming accessories with toys like helicopters that can be remotely controlled via iOS and Android apps.
Sedek is also exploring health-monitoring accessories—heart rate wrist monitors, calorie burning trackers, massagers—by such manufacturers as Scosche, Oregon Scientific and Homedics.
Nebraska Furniture Mart is another retailer that always tests new accessories. One of these is fitness (weights, yoga mats) as an adjunct to growing sales of treadmills, ellipticals and exercise bicycles. There’s even a whole department devoted to ‘As Seen on TV’ items. “It’s not something you’d really add onto a TV purchase, but that’s been a very good business for us,” Shaw said.
Sedek does carry traditional peripherals for the iPad and other tablets, and noted a trend toward the purchase of more ruggedized cases, which he thinks dovetails with the increasing use of tablets by young children. “We carry Android-specific accessories for the major tablet brands like Acer, Samsung and Asus, but the selection is still limited, and we look more to universal products that would be for everyone,” Sedek said. Stocking more universal accessories for non-iPad tablets is also a guiding philosophy at Nebraska Furniture Mart.
Sedek has adjusted his merchandising to include fewer SKUs than the 40 to 50 models of tablet cases he’d carried in the past, and is reorganizing new SKUs into good-better-best categories that target specific demographics and sub-categories. That winnowing has made room for more headphones.
“People will spend for any type of headphone as long as it appeals to their fashion sense,” he said. “We’re putting focus on different angles to target different consumers in different ways: adults who may want better sound, kids who may want the cool pink headphones their friends have, eco-friendly models.”
Shaw is one retailer who hesitates calling headphones accessories. “They’re a major category on their own,” he said, acknowledging that their fashion appeal necessitates merchandising them with the same mindset as clothing or furniture.
“You wouldn’t come to a furniture store to see the same mauve couch in the front entrance of the store, year after year, would you?” he said. “You’d want to see something different. You wouldn’t go to a clothing store and expect to see the same dress or the same blouse and pants in that showroom entrance month after month, year after year. Well, it’s no different in a lot of these accessories categories. They’re a fashion business, and you bring in what you believe is a reasonable assortment of a fashion item, and you sell through it. You keep the fashion fresh.” l