Good News, Bad News

“Flat Panel Tops CE Wish Lists Of The Wealthy”

The Good News: According to a survey conducted by Thomas, Townsend & Kent, flat panel televisions top the list of toys that “affluent” consumers intend to buy this Christmas.

The Bad News: 77.4 percent plan to buy one at Best Buy, 53.8 percent say they will buy one at Circuit City, 41.3 percent intend to buy from Wal-mart, and 30.7% will buy from a manufacturer’s on-line shopping site. Total percentages are higher than 100% because respondents were allowed to select more than one choice.

Analysis: I requested a copy of the survey findings from TT&K (and suspect that they are going to spam the crap out of me for the rest of my life to get me to hire them to survey something) so that I could drill down into the data and develop a deeper picture of the findings than what TWICE reported on. Sadly, the pdf they sent me was pretty bare bones. Key questions that I had remained unanswered such as what income bracket qualifies as “affluent” to the minds of TT&K.

Going further I’ve got two key points in response to these findings. First: I would hazard that nearly 100% of the “affluent” respondents already own at least one flat panel television. In fact if they are truly “wealthy”, rather than just “well off” they have owned one for up to five years, and if they are shopping for a tv this Christmas it will either be a larger set than they own now, or will be a secondary unit for the bedroom or the lake home.

Secondly, if the clear majority of the 2,108 “affluent” shoppers polled are representative, and the general “affluent” public is going to buy their flat panels at Best Buy, Circuit City, Wal-mart and the Internet, then that tells me that regional specialty dealers (who only got 16.6% of the votes) and small boutique specialists have (as a category) dropped the ball when it comes to building their market by differentiating based on service, expertise, and educating the consumer. At CEDIA Expo last month I heard all the pissing and moaning about the “race to zero” on plasma tv prices, and the “commoditization” of CE categories across the board. I also know from experience that “experts” in the industry love to mock Best Buy’s inept customer service, just as I know nobody who has ever had a pleasant shopping experience there, and yet the masses keep flocking there, and to other equally value-poor outlet stores, simply because they haven’t been educated that the specialty dealer can deliver greater value than the big box stores.

So my question to regional specialty dealers is this: if you’re so much better than Best Buy and Wal-mart, why are you letting them eat your lunch? I recognize that few of you want the low margin portables or video game business, but why are you losing out on tv and stereo sales if you’re so much better? If I can take a moment to insert a plug for Jeffrey Gitomer, my favorite sales guru (although this is a lesson I have long known), if you believe that you have to compete on price, you’re sunk. Once you start providing value and trust, then you have a leg up on competitors who have to lowball their wares to make a sale.

Consider that a challenge to those of you who are heading into the most crucial sales quarter of your year!

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