Dixons, Comet and now Maplin. A succession of big-name consumer electronics retailers has disappeared from our high streets, falling victim to increased competition from online rivals and declining footfall. There’s no doubt, the bricks and mortar format are in serious trouble, but there could still be hope for consumer electronics retailers.
Smart home hubs like Google Home and Amazon Echo are a rapid growth category – with the global smart devices and connected home market predicted to grow from $24 billion in 2016 to $53 billion by 2022. Yet adoption is still relatively low. Although 67% of people are aware of these devices, usage is currently only at 46%, providing retailers with a real opportunity they can capitalise on.
The problem is, there’s still a degree of uncertainty around smart products. While 27% of customers appreciate that smart products can have a positive effect on their life, 25% express concern over the technology’s invasiveness. So, letting people experience smart products for themselves before buying them is key to encouraging adoption; an advantage high street retailers have over their online rivals.
In the new age of the experience economy, shoppers are increasingly seeking a multifunctional and experience-based environment. A recent study found that shoppers will visit physical retailers in the search of communal experiences and social interactions. Additionally, it suggests that 75% of Generation Z consumers already prefer going to stores that present a more memorable and encouraging shopper experience. If consumer electronics retailers can create an experience-focused, engaging shopping environment, they’ll be successful. Showcasing the automated homes of the future in a way that will reassure consumers about this new category of products will be critical.
While some retailers are still struggling to decide where and how the new products should be merchandised, others have it nailed. John Lewis and Target have already shown how presenting products by room, instead of category, while demonstrating their functionalities, can demystify smart tech for consumers in a contextual sense. Visualising how smart products practically work together in a home environment, where people can experience the products first-hand, significantly decreases nervousness around this new category.
But it’s also an opportunity for retailers to engage with customers in innovative and exciting ways. Those who embrace new technologies and deliver the experiences customers seek will not only remain on the high street, but will lead the way in the approaching new smart home era, securing their survival as retailers in this category in the process.