NATM Emphasizes Premium TVs
June 3, 2019
- Author: Steve Smith
May/June 2019
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Jerry Satoren, executive director of the NATM Buying Corporation, describes his group consisting of “twelve healthy independent retailers — some in business from 80 to 100 years — that change with the times. It is gratifying to see them face challenge after challenge and continue to succeed.”
Times are good for NATM members, a $6.3 billion national retail buying group representing a dozen of the largest independent regional retailers which sell consumer technology, major appliances and home furnishings.
Televisions, especially premium TVs, are a key NATM category since its founding in 1970. Satoren, an industry veteran who began his career at Thomson Consumer Electronics working with RCA and Toshiba, knows the business intimately and recently discussed 2019 prospects in TV.
Satoren says 4K TVs have been selling well for the group. “We are premium sellers and our growth has been coming from early adopters,” with both sales volume and profits increasing. Years ago, that was not the case in TVs, with NATM members competing heavily back in the 1980s, 1990s and even the 2000s, when the mass market commodity TV business generated volume but little profit.
Enter 4K TV
Satoren and NATM have seen an “interesting transition” since the end of last year, with 4K TVs entering the mass market. Second- and third-tier TV makers have moved into the 4K business emphasizing price and are gaining market share.
The challenge for NATM, and independents that sell premium TVs, is to sell the benefits of larger 4K TVs while maintaining profitability. With NATM’s premium selection, informed sales people in their stores and support from key suppliers, he expects the group to generate solid, profitable growth in 4K this year, with an emphasis on larger screen sizes.
Satoren says, “In 2019, screen size creep is our friend. We would like to see sales growth in 75-inch and above 4K TVs. Sales doubled last year in units for those screen sizes. That brings dollars up and we hope that trend continues.”
Looking Ahead at 8K
As for 8K TVs — one of the stars of CES 2019 — Satoren says the new upscale sets will play a small role this year.
“We have expensive 8K TVs for early adopters, and folks with lots of disposal income will buy 8K sets and they will have higher dollars and good profit margins.” But in sales volume it “won’t move the needle due to pricing.”
He acknowledges some negatives of introducing 8K now. He says, “Some say it is too soon, it creates confusion, there is no content and may keep consumers on the sidelines.”
But Satoren adds, “It’s a good thing our industry is bringing in 8K, because it shows consumers there is ‘the next big thing in TV.’ It also shows the industry has the technology to continue to make TVs an aspirational purchase and have consumers consider a step-up purchase and not stay on the sidelines.”
While 8K TVs won’t be a major sales volume item for the industry this year, Satoren says that for NATM members, “We still have customers who are willing to spend $2,000 or more on a largescreen premium TV, which is also good for suppliers of fully-featured and upscale 4K and 8K TVs.”
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