RetailVision: Change Confronts Consumer Electronics Market

The consumer electronic retail market is both growing and shrinking. And as consumer expectations change, those who are to survive will have to become more innovative than ever before to stay competitive.

Kicking off Everything Channel's Fall RetailVision conference, Tim Herbert, senior director of market research for the Consumer Electronics Association, illuminated key trends in the consumer electronic space that indicate the market is often going in different directions simultaneously.

"There are fewer channel options and more channel options. There is less service and support and there is more service and support. There is a diminishing revenue source and new revenue sources," said Herbert.

During his speech titled "The State of CE Retail: 5 Key Trends Changing The Way Consumer Electronics Are Sold," Herbert specifically discussed five trends that will likely continue, for better or worse, in the consumer electronics retail space.

One trend that will continue is that that the consumer electronic market place will expand as more consumers are willing to consider alternatives to buying electronics from traditional retailers and other outlets.

"Consumers now are looking for the convenience of buying these products wherever and whenever they want to," said Herbert, adding that non-traditional vendors, such as Toys "R" Us, experienced an explosive three billion in sales of electronics. "You see lots of different channels. Technology is finding its way to a lot of different resellers."

And there have never been so many different options for consumers in the electronics space. "We see more manufacturers selling directly to the consumer and we see retailers with their own private label goods selling to the consumers," he said.

In addition, while overall consumer electronic shopping satisfaction rates are very high, "the experience could be improved," Herbert said.

Areas that could be improved upon include services such as in-home tech support and in-store demos, which users indicated were often lacking in their consumer sales experiences.

Like many other markets, Herbert said, consumer electronics are undergoing intense pricing competitions -- which means that while some products have dramatically increased in price due to technological advances, others products, such as digital cameras, have actually decreased in price as they near end of their market potential.

Another trend that will certainly continue to grow is the number of consumers relying on the Internet when making decisions to purchase electronics, whether that's to search, compare, or actually buy the product.

Finally, Herbert concluded, consumers are increasingly open to innovative approaches for receiving marketing and information regarding electronics.

"Innovate or die," said Herbert, when mentioning marketing trends over the next 10 years. "New approaches are essential to ensure that, whether you're a retailer or manufacturer, you're on the top list in 2017."