Consumer electronics manufacturers are running their own “Cash for Clunkers” programs targeting consumers and dealers.

August 21, 2009

It’s the last weekend to turn in your heaps of metal (once referred to as cars) as Monday, September 24th, marks the last day of the US’s Cash for Clunkers program. With the $3 billion of government funding quickly running out, the program has thus far amounted to 457,000 car deals and pay outs of $1.9 billion in rebates (per this morning). The “success” of the program is yet to be determined, but car dealers need to hurry to be sure to submit all necessary paperwork (which I hear is a BEAR and quite extensive) by 8pm EST on Monday. Regardless of the outcome, this element of the government stimulus package certainly injected some much-needed consumer activity into our waning economy.

This week, Home Theater Review’s Jerry Del Colliano posted a great story “Cash for Clunkers – Meet the AV Business” article. It is a good read that likens the struggling custom install consumer electronics industry to the plight of automakers. Though GM, Ford, and the “lucky” car dealers (the definition of lucky yet to be determined) are benefitting from TARP program funding, there are plenty of other dealers throughout the country who are equally struggling to move inventory.

The Las Vegas market is one of the many nationwide to be virtually devastated (not to be dramatic, but the news makes the once burgeoning community sound like the ghost town of old) by the current economic climate. HTR’s article focuses primarily on one high-end AV dealer that is weathering the storm thanks to ample investor funding, but “Craig’s” business is being burdened by older AV product in its showroom and a plethora of inventory.

“Cash for Clunkers – Meet the AV Business” notes the “lip service that AV manufacturers give towards ‘dealer support’… You’d see how you could get an extra five percent off a nice big new order to help offset the trade-in costs. Everybody wins and everything moves forward for the first time in over a year in the world of specialty audio-video.” Well, that is exactly what Runco, a leading manufacturer of luxury video solutions in the custom CE installation industry, intended with its TradeUp and TradeOut program that launched earlier this year.

Residential Systems magazine’s editor-in-chief, Jeremy Glowacki, recently spoke with Runco’s VP of worldwide sales, Bob Hana, about this very topic; providing value to Runco customers and Runco dealers for older product and putting that value towards new, upgraded gear for their homes and showrooms.

In a recent conversation, Hana reminded me that step one of fundamental selling during tough times is to reach back to past customers, especially because so many new technologies have been introduced recently. “A lot of things have changed in the last six months to a year in this industry,” he said. “You’ve got every excuse in the world to upgrade. There’s the 2.35:1 aspect ratio, 1080p video, and Blu-ray.”

Though the specifics of the program is a mixed recipe consisting of a little of this and that, from both the dealer and manufacturer, the program has proved to be successful for those taking advantage of the opportunity. Time will tell if Runco, like the TARP program, was overwhelmingly successful in its efforts to inject sales life, activity and profit into its dealers’ businesses, but thus far, feedback has been positive.

“Runco is creating a sales opportunity where there otherwise might not have been one,” said Gramophone’s Josh Shobe about the program. “Right now, that kind of support is invaluable.”

Posted by: Katie

NuVo Terminates Two Dealers for Violating Its Internet Sales Policy

August 20, 2009

CE Pro’s Tom LeBlanc yesterday published an interesting, detailed piece about NuVo Technologies’ termination of two dealers for selling its products over the internet, a clear violation of NuVo’s policy. Residential Systems’ Jeremy Glowacki also covered the NuVo story in-depth in the context of another manufacturer’s similar initiative.

Some people would say, hey, what’s the big deal? They’re just electronics products. If someone wants to eliminate the middleman, what’s the harm?

Well, it’s a big deal on two fronts. For one, NuVo’s whole home audio products are by no means DIY or off-the-shelf retail; they are clearly and explicitly meant to be professionally installed by an authorized dealer. Only someone who is trained in installing this stuff can fully understand its capabilities, install it properly and make it sing. These systems aren’t just something you plug into a wall; they require wires to be run throughout a house, inside the walls (and in the case of NuVo’s upcoming Renovia system for retrofits, they require a knowledge of electrical systems).

Not everything is meant to be bought on the internet. Like one of my other clients, Universal Remote Control, says, “Sure, you could buy an artificial heart online, but you’d probably want a trained professional to install it.” Of course, electronics products aren’t a matter of life or death, but you get the picture.

The other aspect of this is NuVo’s effort to support dealers who play by the rules. By dumping products on the internet, rogue dealers are negatively impacting policy-abiding dealers. If NuVo were to let the rogue dealers run willy-nilly, what would that say to its ethical dealers?

And what are those rogue dealers saying to the world about their own industry: custom installation? By selling installation-only products on the internet, or selling them to third-parties who resell them online, these dealers are implicitly and wrongly communicating to the public that their custom installation services aren’t really necessary. Essentially, they’re destroying the foundation of their businesses and their industry just to make a few quick bucks.

It’s great for the CEDIA channel that manufacturers like NuVo are standing up to the bad guys and protecting the good guys.

Posted by Joe Paone

Journalists on PR: Jeremy Glowacki

December 15, 2008

Today marks the inaugural edition of a new CasterBlog feature called Journalists on PR. Caster’s Joe Paone will interview various journalists to gauge their feelings on the state of the public relations industry, as well as glean useful and constructive information that PR professionals can use to build more mutually fruitful relationships with journalists and, by extension, better represent and serve their clients. A trade journalist for 16 years before he arrived at Caster in 2007, Joe has a unique perspective on the eternal tensions between the two fields.

Jeremy Glowacki

Jeremy Glowacki

We’re honored to interview Jeremy Glowacki for our first installment of Journalists on PR. Jeremy is a veteran magazine editor, having worked for numerous publications over his 15-year career. In January 2000, he helped create and launch Residential Systems, a business and technology magazine for the custom audio/video installation industry. He remains day-to-day editor of that title and editorial director of Systems Contractor News, Rental & Staging, and Residential Systems International and their websites, which are all owned by New York City-based NewBay Media LLC. He holds a bachelor of arts degree in journalism from the University of Georgia and currently resides in Carmel, Indiana, with his wife Karen, two young daughters and beagle/bassett mix.

And awaaaaayyyy we go, after the jump…

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