DSI’s Satoren Talks Categories, Trends
Jerry Satoren, DSI Systems’ executive vice president, Consumer Electronics, provided Dealerscope with his market insights, just after the company’s June-held annual dealer Expo.
Dealerscope: What product categories are hottest for you now, and are drawing the most dealer interest – and why?
Jerry Satoren, DSI: For DSI, it is clearly large-panel TVs, 60-inch and larger. The current price-points of these screen sizes have created a very robust consumer demand. The vast majority of our dealers have selling floors and these large panels are usually the main TV in the home, which more often than not requires a demonstration, provides a bigger ticket, and a more receptive consumer regarding add-ons. Further, the likelihood of delivery and installation goes up with TVs of this size. Our dealers have done very, very well over the past 12 months. The other hot category continues to be in the streaming audio space. Whether it is wireless audio for video or mobile device streaming, the consumer’s appetite is healthy for more convenient and user-friendly options.
Dealerscope: Have you added new categories that specifically respond to dealers’ needs, and if so, what are they?
Satoren: Yes, we have. Over the past few years we have watched many of our traditional TV/appliance stores add categories like furniture and bedding “morph” themselves into home stores. The result has been that dealers are adding higher-margin items, keeping their loyal customers from purchasing these items from a competitor, and creating new customer store traffic. With that said, we have been testing some of these additional categories to further improve our dealers’ bottom lines by allowing more cost-effective product procurement and increased inventory turns. We will have more to say on this later this year.
Dealerscope: How are you helping your dealers get ready to properly present and sell Ultra HD/4K TV?
Satoren: Well, one of the first steps took place at our Expo. We have made training seminars available to our dealers from LG, Sharp, Toshiba and Sony. Much of the material being presented in these sessions is focused on 4K: What it is, why a consumer wants it, and how to sell it. Starting in August, when availability from multiple brands is a reality, we will offer our dealers a display program for 4K TVs that will include a floor model financing component to assist our dealers with the high cost of displaying them on their floors. In the end, no consumer will spend this kind of money without seeing an in-person demo. The likelihood of the consumer buying that TV where they saw it is very high. So it is critical to get properly prepared and positioned to capitalize on the opportunity.
Dealerscope: Talk about the importance of the independent dealer to the development of new categories and CE markets. Can new technologies reach their full market potential without the educational capabilities of independents?
Satoren: The independent dealer has never been more important in getting new categories and technologies launched. As our digital world evolves, products are becoming more complex, especially as we try to integrate them with each other. So in my opinion, no new category can reach its potential, especially from a business perspective, without the education a good selling floor provides. Let’s face it, if you want early adopters and others with the resources to pay the highest pricing at the beginning of a product or technology curve, someone needs to show them why it is “worth it.” Without this, we end up in a self-serve model that almost always defines its success by price alone.
Dealerscope: After meeting with your dealers for two days at Expo, what is the overall feeling about the second half that you came away with – are they/you optimistic about second-half sales and why?
Satoren: As most of our dealers are very TV-centric, I think all of them left here feeling excited about the back half. The TV business through much of the first half has been difficult for nearly everyone, as much of the business below 60 inches has been promotional and price-driven. I think everyone realizes that as 4K rolls out in a much broader way in the fourth quarter, there is going to be renewed interest and excitement in TV. If you look back over the years, consumers have always been driven to buy when presented with an option to get better picture quality. Boy, are they ever going to get a great option for better picture quality this fall.
Related story: Snapshots from DSI’s June 2013 Expo