Distributors Reveal Most Profitable Products
*David Kaplan, Executive Director, Digital Delivery Group (DDG):* Flat panel—and attachment to flat panel—has been the business driver for many years. 2010 drove home the point that this is simply not the case anymore. The new driver is the retrofit integration and upgrade opportunity of attaching connectivity and interactivity to the broadband networked home.
*Doug Robison, President, DSI:* What we’re working on for 2011 is getting the independent retailers to demonstrate connectivity in their showrooms. When a consumer walks in, they can have that consumer pull out their smartphone and be able to demonstrate Pandora or Netflix on TVs. In a survey of our customers in the independent channel, it looks like less than 10% of the dealer base is actually demonstrating connectivity today. That’s what we’re trying to fix. Part of what we’ve done is to come up with a simple connectivity kit—a one-in, four-out router with cabling—that provides the dealer what they need on their floor to easily and inexpensively hook up and then demonstrate the widgets that come with a TV set. That helps them make more money as it helps them sell stepped product.
What happened to the business in 2010 is it went almost to an all-leader business. We’ve got to get the salesfloor back into stepping the consumer up, and we think IP TV is going to make the difference in terms of margin. The important thing is to get some margin back into the business for the independent, and selling leader products is just a bad way to go.