HTSA Focuses On Luxury Consumer
With sales to the low- and mid-end of the market flagging, the Home Theater Specialists of America (HTSA) buying group is directing its members to tap into more luxury clients.
Combined sales of the group’s 62 members was up only about five percent this year, for combined revenue of about $500 million, said Richard Glikes, the group’s executive director.
“I thought we would have had a better year,” he said during the group’s recent Fall Pump Up in Dallas. “Depending on the dealer, we’ve always had 20, 30, 40 percent compounded growth, and it seems like we’ve hit a wall. We were used to being the darlings, the heroes. I’m not comfortable with this (year’s revenue).”
Glikes and dealers blame the stagnation on erratic product supply, sinking TV prices, low consumer confidence, the housing slump, and the credit crunch. Consumers in the upper tiers of the income bracket, for the most part, are relatively immune to those market conditions and continue to buy big-ticket home theater systems and related services.
“The big stuff is selling as well as ever,” Glikes said, referring to high-end home theater components, such as more expensive flat panels, surround-sound systems, a variety of home and system controls and furniture. “I’d rather we start focusing on the $200,000 jobs instead of 10 $20,000 jobs. One big job is easier to do than a lot of smaller ones.”
Some bright spots in the tough year, Glikes and others said, include lighting, up 35 percent for the group; and furniture, up about 17 percent. Audio was up about five percent. While flat panel sales are strong, margins continue to sink. Many dealers have been saying they expect the price of 40-inch plasmas to hit the mid- to high- $500 range this holiday season. “Pick a brand, it’s going to happen,” Glikes said. “I want to sell more flat panels, but that can’t be the prime focus anymore. We want our members to sell lighting and shade control and networking.”