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DR AddsSpark to Consumer Electronics

1 Dec, 2009 By: Doug McPherson Response

“The Web and mobile phone apps have caused consumer valuation to dip,” he says. For instance, O’Leary has an app on his iPhone called “Lose It” for fitness. “It’s a free app, so there’s a devaluing of what can be sophisticated products. You have to put a value proposition in front of the consumers that they really understand. Often that is saving money or so entertaining you’re going to save money.”

Wii Fit, Nintendo’s fitness game, is one example. “We’re replacing hard fitness products and getting in shape for a lot less money” he adds.

Corporate Communications Specialist Aaron S. Fowles, Sanyo North America Corp. in San Diego, adds that along with value, the message has to be “fresh and exciting.”

“This can be extremely challenging, but if achieved, it can drive consumers to the site or retail where they can buy the product continuously,” Fowles says.

When it comes to sharing value via the Internet, O’Leary says to expect consumer electronics makers to be more Web marketing savvy than other kinds of clients because their demographic understands the Web and Web metrics.

Sanyo is a good example. It has proven it’s hip to interactivity. This year Fowles says Sanyo held a contest to see who could create the best infomercial with the company’s dual cameras, and the videos featured links back to either the Sanyo site or other online partners, such as Amazon, to buy the product.

And Sanyo has recently redesigned its Web site and added an online store function to market its products directly to consumers. “We’re adding a small sentence to our signature line of our E-mails, adding links to it in our press releases, prominently displaying it at the top and around the pages on our Web site, and in promotional materials handed out, such as brochures, USB memory and other items,” Fowles says.

Regardless of how consumer electronics are marketed, the economy may have the final say on just how well sales go.

Fowles believes consumer electronic products are often seen as the least necessary when money is tight. To stay competitive, Fowles says prices usually have to drop, adding, “That means the entire production to customer process may need to be re-evaluated, finding cheaper raw materials and production, as well as logistics planning.”

The result? Cutting-edge developments are delayed until things stabilize, says Fowles.

But DuBravac says flat-panel TVs are up almost 30 percent this year, and that audio and sound bars did well. “As a share of spending, consumer electronics has never been higher,” he says.

Still, he admits 2009 was a down year. “Consumer electronics dropped almost 8 percent, but it’s held up better than a lot of industries … we’re still seeing spending on some electronics, such as singlelens reflex cameras and Blu-ray.” But he still predicts a “slow, muted and shallow” economic recovery.

O’Leary says clients are challenging him on production budgets on the front end “because they’re risk adverse because of the economy and that’s reflected in their budgets — budgets are down across the board.”

Fowles adds that consumers “surprisingly return [to market] and buy” these products once things start going well again. “The issue is … to keep the product fresh and new enough that once the consumers do return, it can be a trend-setter and jump start the drive to consumer electronics.”

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