When it comes to retail, it’s clear that the products and services we’ve been offering are beginning to adopt a “smart” component to them. The move started in the consumer electronics (CE) business but has now penetrated the home appliance market as well. And we, the independent retailer, have an amazing opportunity to not just better understand this fast-paced, growing category but master it – and then deliver our expertise directly to the consumer.
That prospect is what led Nationwide Marketing Group to form Nationwide Connected Home, the industry’s first connected home division dedicated exclusively to the independent channel. And we’re excited to give you a sneak peak into what this initiative will be tackling in the coming months.
The Size of the Market
Let’s take a step back and look at how prevalent the connected home movement really is.
Behind wearables (smart watches and fitness trackers), smart home products have been the second-fastest–growing category in the CE segment in terms of percent growth (over 50%). And that isn’t expected to slow down anytime soon. In fact, the addressable market gets even more impressive when you look at the $490 billion in revenue these products are expected to generate by the end of 2019. Need more supporting evidence this market warrants our attention? Smart home products are also estimated to draw an impressive 42% repeat shopping behavior, which means more footsteps in your locations.
But here’s where it gets interesting. We’re also learning that consumers don’t quite understand this market, with 52% of people either scared or intimidated by these products. And that puts your knowledgeable sales team in a prime position to overcome these objections and create a smart home experience that meets your customers’ needs – and creates customers for life.
News of the negative effects that smart phones have on children and families keeps popping up with increasing frequency, ironically, on our phones. In an article by Natalia Lusinski for Business Insider (June 7, 2018), she explores 12 possible negative outcomes from overuse of smart phones, including relationship and friendship breakdowns, Fear Of Missing Out (FOMO) and, most concerning, parenting failures.
All these issues stem from putting too much focus on a single device and not giving enough attention to the people around us. But the entertainment and benefits we enjoy from all the connected content that is available on our mobile devices will never go away. Smart major home appliances have recognized this problem and quickly evolved to deliver solutions that bring the family back together again.
As every family knows, the kitchen is the hub of the home. So, it makes perfect sense that connected kitchen appliances could be a great solution. In fact, many manufacturers are now incorporating “HUB” features into their kitchen products, connecting music, video, social and productivity content in the most popular location of the home. And these enhancements have become the standard in the premium and luxury appliance spaces.
At Nationwide, we are very focused on offering the best solutions to help promote the benefits and value of the connected kitchen. Over the next several years, as consumers become even more aware of the positive impact a connected kitchen could bring to their family, we should expect to see a rapid increase in sales. But more importantly, this is an opportunity to help solve a growing family concern.
Smart Consumer Electronics
In the CE connected home space, there are a few categories whose products are defined as “smart,” primarily security, entertainment, networking and energy. Collectively, the number of products available in these segments is well into the thousands. But it doesn’t have to be overwhelming.
Nationwide is making this category as turnkey as possible by limiting the number of brands and products. When we started exploring this opportunity, we knew we needed to choose a partner that would support our channel. And after ruling out Amazon and Apple, Google was the clear and easy choice. With Google, we get a great brand backed by an open platform, top–selling products and existing functionality in some of the products we sell today.
To learn more about these products, group programs and go-to-market strategies, stop by the merchandising booth on the show floor at PrimeTime.
Reimagining the Retail Connected Home Display
Because connected home is still in its early stages, it requires a high–touch consultation to reassure the 52% that are intimidated by the products and encourage them to jump in and start the connected home journey. However, if we surveyed the industry to pick a “Best in Class” retail connected home display, many people would likely struggle to name a presentation.
Unfortunately, connected home took a DIY approach to market in its early days. And as a result, simple displays were created on standard peg board and shelf displays. In fact, it is very rare to see a fully functioning connected home display at retail. Until now.
At PrimeTime in New Orleans, we will display the industry’s best-in-class connected home environment – a tiny house that is entirely connected from front door to kitchen, living room to deck. This model can be used at retail stores to help showcase how a connected home program can be adopted and what the benefits will be. It will surely inspire customers to engage with the connected home movement differently than they ever have before.
As smart homes continue to converge with our lives, it is going to take the best independent retailers to show customers what a great connected home experience truly looks like. The opportunities that this category presents to Nationwide members through sales, service, installation and support are just an evolution of all the benefits that each of you provide today in your existing businesses. Expanding both the connected home product offerings and installation services will only grow your opportunity in this very large and quickly growing category. Plus, add in a best–in–class display strategy, and we have all the makings of an independent retail win over any of our DIY competitors.
Please visit us at the Nationwide merchandising booth on the PrimeTime show floor to learn more about how we can help you grow this segment, or contact Derek Mattila at firstname.lastname@example.org.