Retail AV Hit Hard by U.S. Economic Woes - ResidentialSystems.com

Retail AV Hit Hard by U.S. Economic Woes

There’s always been a Catch 22 for the custom installation channel when it comes to mass-market retail competition. On one hand, most retail outlets -- particularly the big-box stores like Best Buy and Circuit City -- often under-serve customers looking to make big purchases like flat-panel TVs, computers, and dig
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There’s always been a Catch 22 for the custom installation channel when it comes to mass-market retail competition. On one hand, most retail outlets -- particularly the big-box stores like Best Buy and Circuit City -- often under-serve customers looking to make big purchases like flat-panel TVs, computers, and digital cameras, because of their lack of product training or simple apathy. Even the “installation departments” of these retailers typically provide nothing more than a hang-and-bang attitude with no customer service to speak of.

On the other hand, retail does provide the custom channel a decent recruiting tool for customers who aspire for more quality and better service. Wealthy individuals might walk into a big box store only to reach the conclusion that there must be something better out there. That’s when a word-of-mouth recommendation leads them to a specialty retailer or custom installation firm that can properly educate them about what they really need in their home, work with their builder and interior designer, and train them on how to use their system once it’s installed and integrated.

I bring all of this up after learning from the Boston Globe today that Tweeter is finally done for good, a year after filing for bankruptcy protection with about $165 million in debt. The Canton, Massachusetts, electronics chain is reportedly preparing to close in the next four to six weeks, according to store employees. This bad news comes on the heels of a similarly ominous story that Circuit City has closed 155 of its stores across the country.

Admittedly, retailers like Tweeter and Circuit City have been easy targets for veteran CI guys who take pride in their own work and customer service and find these competitors to be sub par. However, it’s sad to see the slow death of AV retail continue to drag on as consumer spending dries up in the wake of a collapsing U.S. economy. Even with a more affluent demographic as its target, it is hard to imagine that the CI channel won’t feel the repercussions of this news. Yes, hungry consumers always have the Internet for research and even direct purchases, but the retail sales floor and demo showrooms are where the excitement really happens. If every retail outlet dried up, I’m afraid of what that means for the CI channel and consumer electronics as a whole.

Case in point: my Uncle Steve is a typical Midwestern, middle class kind of guy who has always loved his toys. Over the years he never skimped on cars, boats, or any other hobby de jour. He has always purchased the best bass fishing boat, the best trap shooting guns, the best (a biggest) American-made SUVs, and has always has been an early adopter of consumers electronics. Somehow, however, Blu-ray basically passed him by… until last weekend when I received a breathless phone call from him after seeing one in action. He finally got a demo and he could not believe how much better Blu-ray was from the HD cable picture on his 50-inch Sony HDTV at home. He just wanted to share his amazement with me and ask me what I thought. It surprised me a bit that it had taken his so long to see what I agreed was an amazing piece of video technology, so I asked him where he finally got a taste. Wal-mart was his answer. Yes, with the demise of AV retail, Wal-mart might be all that we have left. God help us all.

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