Nationwide Group Shows How Independents Can Be Major Electronics Players
March 15, 2018
- Author: Steve Smith
January/February 2018
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Not only are national retailers getting bigger and more influential, so are electronics retailers that are either Mom and Pop stores or regional players.
My visit to the Nationwide Marketing Group’s PrimeTime convention in Orlando made that clear to me. Nationwide, a mammoth buying group, now has $15 billion in annual retail sales – typically 50 percent in major appliances, 25 percent in electronics and 25 percent in home furnishings and outdoor products – since its merger last fall with the Mega Group USA, mostly an appliance/home furnishings organization.
The merger created an $18.5 billion organization with more than 5,300 members operating 14,000 storefronts. But Nationwide is not just relying on its size to increase its business. As Tom Hickman, who was named president of Nationwide at the convention told his members and suppliers, “It’s not the big that eat the small, it’s the fast that eat the slow.”
Nationwide illustrated during PrimeTime that it is not only leveraging its growing electronics and major appliance market shares for its independent retail members. It also is leveraging its partnership with Google to upgrade its digital marketing programs and having more of its retailers carry electronics in order to help members increase market share, sales and overall profitability.
About that last point, having more of its retailers carry electronics, Nationwide’s Mega members never did much in electronics sales. Rick Bellows, former head of Mega and now a senior executive with Nationwide says, “Our guys who sell electronics are more than thrilled to be part of Nationwide.”
Especially considering the group’s success selling electronics and its relationships with industry leaders LG, Samsung and Sony. In addition, Jeff Knock, a Nationwide senior executive team member, says that the group is “cross pollinating our members,” meaning that it will help its retailers enter new categories, such as electronics.
Independent retailers should be excited about Nationwide’s performance in electronics. According to Doug Wrede, CE merchandising director, the buying group has been able to create more sales volume and profitability, emphasizing premium home products.
“While the industry was down [in 2017] in consumer electronics, according to NPD statistics, we were up 17 percent,” he notes. “Premium is a great space for us [in sales and] in profits. Again, quoting NPD statistics, Nationwide’s overall average selling price (ASP) during 2017 was larger than the industry average.” He explains that the OLED TV category, “is very big for us, 34 percent of our TV sales are OLED.”
And Wrede expects this year there will be “consistent single digit growth in CE and that ASPs will increase,” which he says is great considering, “there is no new underlying technology that will considerably increase demand” for the home mix that the group focuses on.
Wrede says that “Tier 1,” or premium brand TV sales were up 22 percent versus the previous year for Nationwide members, while its lower end TV sales were down by double digits. And he claims that sales growth for Sony, Samsung and LG has been faster with Nationwide “than the rest of the industry.”
Part of the reason for Nationwide’s success in premium electronics has been the performance of its Home Technology Specialists Nationwide (HTSN) unit of custom installation businesses which had double digit growth last year. Sharing expertise has been a factor in electronics growth, Wrede says. “Our HTSN alliance continues to bear fruit extending knowledge of training and education in attacking that business.”
Connected home technology is continuing to evolve and become a bigger part of Nationwide’s business, especially with its partnership with Google’s Nest operation and leveraging its major appliance clout. At PrimeTime Nationwide’s Connected Home displayed Nest’s smart doorbell, lighting, Google Hub and other products and systems, along with smart appliances from Whirlpool. And Wrede says that Whirlpool, along with LG and GE, held a connected home seminar for its members at the show.
Finally to keep up with in-store and online retailers, as headlines talk about national chains closing locations, Nationwide is working with Google to provide baseline website analysis based on Google’s best practices. The group is also offering members its “Nationwide Google Benchmark” to compare a dealer’s analytical data against past performance or genetic data, and provides the same service on dealer’s Facebook page performance. And the group continues to provide website design, digital marketing services and Ultra 4K video content for custom demonstration and in-store marketing.
Nationwide is showing how independent retailers can keep and attract new consumers in-store and online, by not only providing cutting edge products at the right price, but provide the marketing clout and savvy to help set the pace in the changing world of consumer technology retailing.
Steve Smith is the former editor in chief of TWICE magazine and a member of the Consumer Technology Hall of Fame.
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