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LOUNGING IN (SMART) STYLE Luxury tech is bringing comfort to every room of the house

FEBRUARY 11, 2019 • VOLUME 34 • ISSUE 3

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his year’s TWICE Retail Executive Roundto experience them before committing to bringtable covered a lot of ground, with the ing them into their homes. They want to learn conversation touching on everything about them and will seek out the dealers who from true wireless to tariffs. But among the most can provide personalized consumer education. encouraging topics was the unifying sentiment They want to protect them, offering yet another from our participants that moment for add-on warranphysical retail still has a ty sales. And, finally, they meaningful presence within often want (or need) them the consumer journey. to be installed within their That journey has been a home, and Alan Wolf ’s story Consumers spending large roiling one, to be sure, and on p. 14 explores how some sums of money on highall signs point to that condealers — most especially ticket items will seek out tinuing. Just as one chalthose within our custom the dealers who can provide installation audience — are lenge is navigated (Internet shopping), another one forced to cope with the ispersonalized consumer emerges (mobile commerce) sue of having more business education. with still others on the horithan they can handle. As the zon (shop-by-voice). Widely labor shortage is expected to accepted now, however, is continue, it’s an issue we exthe knowledge that those pect to resonate with many who adapt and embrace the of you. opportunities offered by change will almost alAs always, we want to hear from you, on these ways fare more successfully than those who issues or others affecting your business. You may freeze or scoff. have noticed that we’re including more polls on Luxury technology, a burgeoning category repour website and more requests for company inresented on p. 22 of this issue, is one such examformation in our newsletters. Please always feel ple of consumer tech able to reap the benefits of free to reach out to let us know what you think in-store selling done well. Consumers spending TWICE should be covering and what’s important large sums of money on high-ticket items want to you.

Major Appliance Shipments Leap 4.5% Robert Baird: “Should be a strong start to the year as LG/Samsung will likely import 1,200,000 largecapacity washers by Memorial Day while the dumping tariff is just 18 percent. It goes to 50 percent after they reach the 1,200,000 number.”

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8K TVs Coming From Samsung, LG & TCL Dave Litle: “As an integrator and an authorized service center … introducing 8k before you even have a library full of 4K content is ridiculous. Marketing people are forgetting to mention that OLED TVs can have image burn, especially with video games. Not to mention on the service side, the price of parts is making TV repair a thing of the past. Most TV repair shops are solely owned, and with TVs becoming larger and larger, it makes it impossible to repair or install these sets without help. “And let’s not forget about how fragile these new screens are. I get at least 10 phone calls a week for a cracked screen, and then have to be ‘the bad guy’ telling the customer that they can buy two new TVs for the cost of a screen."

Upcoming Events 4 February 11, 2019 www.twice.com

twice.com/video Welcome Scout: Amazon Unveils Its New Delivery Robot 5 Six Scout delivery bots will begin delivering packages in Snohomish County, Wash., in its initial phase. China Expected To Top U.S. As #1 Retail Market This Year

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March 1-4 Nashville, Tenn.

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PERSPECTIVE

Apps Are Driving In-Store Sales (Really) Mobile phones are no longer the enemy

GETTY IMAGES/SUNWOO JUNG

By Alan Wolf Not all that long ago, during the gloom-and-doom period of brick-and-mortar retail, mobile phones were tarred as a leading harbinger of the coming storefront apocalypse. Terms like “showrooming” came into vogue, and pundits were certain that comparison shopping from the sales floor would hasten the demise of physical storefronts. While there’s no doubt that Amazon and e-commerce had a culling effect on weaker retailers, those that adapted to the new digital reality are now stronger for the experience, developing new approaches like price matching that turned showrooming on its ear. Now, a recent study from Chicago-based Yes Marketing confirms that phones in general, and mobile apps in particular, have since become the store owner’s friend. Yes’ poll of over 1,000 consumers of all ages last June found that more than half (57 percent) are using mobile apps to enhance their in-store experience. Specifically, 57 percent of respondents said they use apps in stores to find coupons, and 65 percent use apps to redeem those digital coupons in-store. Another 46 percent of those surveyed said they use apps in stores to locate sale items. Conversely, despite the growth of m-commerce, only 33 percent of consumers prefer to make purchases on smartphones, the poll showed, suggesting to Yes Marketing president Jim Sturm that rather than fear smartphones, retailers should embrace them. “Retailers need to prioritize the mobile experience,” he said. “Retailers can bridge the mobile-tostore experience by introducing apps that support

in-store shopping with features like maps of store layouts and access to product ratings.” Mobile apps aside, the Yes study, “Surviving The Retail Apocalypse,” found other encouraging signs for terrestrial retail. Among them: • fully 90 percent of consumers make in-store purchases at least monthly; • 60 percent said they shop in stores because they want to see items in person; • nearly half (49 percent) of respondents said visually appealing stores would motivate them to

shop at a brick-and-mortar location; • 58 percent of “centennials,” defined as consumers ages 10 to 23, are more likely than any other age group to shop in stores for visually appealing displays, while millennials (ages 24 to 39) are most interested in store-based events (36 percent) and additional services (42 percent). The complete report, which outlines eight strategies to help merchants adapt to the changing retail landscape, is available at no charge at YesMarketing.com.

Alibaba Launches Virtual Trade Show Platform By Alan Wolf Alibaba.com, the B-to-B wing of China’s e-commerce giant, has added a new wrinkle to its mobile app and website. The latest feature, “Trade Shows,” provides a digital platform for trade event exhibitors that allows offsite buyers to shop their booths remotely. Alibaba debuted and demonstrated the new commerce tool at CES 2019 last month, where suppliers at the Design and Sourcing Hall uploaded short “TikTok”-style interactive videos about their products in real time to the in-app Trade Shows channel, for viewing by virtual attendees worldwide. The company said the goal of the new service is to promote global trade and procurement, facilitate direct communication between trade partners seamlessly, and extend the reach of the physical event to a broader audience online. Here’s how it works: During a trade show, users can access the event landing page via the Alibaba.com app or desktop site. Users will see tabs for suppliers, product and video content, and can mark exhibit locations and events and endorse participating vendors. Each participating vendor can post product videos to promote its presence at the show, bringing off-site viewers and traffic to the digital event booths, Alibaba said. 6 February 11, 2019 www.twice.com


Aaron Levine, Cleer Marketing VP print was impressive. … It’s a lot of fun for me at this point in my career — just being able to take a brand into all sorts of fun directions and grow with them is exciting.

By Lisa Johnston Audio manufacturer Cleer has named Aaron Levine as its new marketing VP. Levine, whose history includes positions at Sound United, Sony Electronics and Pioneer Electronics, joined Cleer in January, just prior to the start of CES 2019. TWICE caught up with him in a phone interview shortly after the show. How was CES? It was amazing. It was very different [because] my first day with Cleer was three days before the show opened. It was jumping in and trying to drink from the fire hose. Even though I understood the direction of the organization, seeing how the team I was joining was able to execute the brand persona in our small foot-

You’ve spent the majority of your career in consumer tech audio. What do you think has been the most exciting recent development in the category, say within the last five years? There’s so much. Between voice assistants and artificial intelligence, there’s also the improvement of long- Aaron Levine time technology, like noise canceling or speaker driver technology for instance. These technologies have been around for a while, but to see the advancements is pretty remarkable. Even the maturity in the voice assistant space; it’s only been around for a few years, but the saturation and proliferation of products are pretty significant. What can we expect from Cleer in 2019? You’re going to see more performance audio headphones in the true wireless and more traditional

spaces. We’re looking at long battery life implementation, [with models] supporting 100 hours of playback on Bluetooth. Ear buds will be on average about 10 hours on a single charge. In the smart display category, [we have] voice assistants built into the Mirage, which is one of the world’s first smart assistants with an AMOLED flexible display. What should consumer tech retailers and distributors know about Cleer? We’re a young, hungry performance audio brand, and we’re looking to define ourselves in the marketplace. Do you intend to grow your distribution channels this year? Yes. Part of the fun of being a young company is making sure we carve out the appropriate path for ourselves, and our dealer relationships are critically important. For us right now, the right partnerships are purposefully in front of us as a goal in every relationship that I have.

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R E TA I L I N G

Training, Timing & (Next-Gen) Tech

Retailers Poised For A Challenging — But Rewarding — Year Ahead The PARTICIPANTS: STEPHEN BAKER

VP, Tech Industry Analyst, The NPD Group

STEPHANIE KEOUGH

Chief Merchant, World Wide Stereo MICHAEL D. MCMAHON

VP, National Retail, Direct2Consumer & Distribution Strategy, Sprint TREVOR MAY

Standing, from left: TWICE’s Lisa Johnston, NPD’s Steve Baker, D&H’s Trevor May, Nationwide’s Doug Wrede; Sitting, from left: World Wide Stereo’s Stephanie Keough, Mrs. G’s Debbie Schaeffer, Sprint’s Michael D. McMahon

By Lisa Johnston For over two decades, top executives from the consumer tech retailing and distributing industry have gathered on the first day of CES to share their perspective on holiday results and the year ahead. Topof-mind topics for this year included smart appliances, 5G, hiring challenges and the potential impact of tariffs. Read on for an edited version of the conversation, and visit TWICE.com for more in-depth dialogue. Apple AirPods.jpg

Steve, start us out by letting us know some of the top products from the holiday selling season. STEPHEN BAKER, THE NPD GROUP: We saw about 3 percent growth over the holiday, which was better on an overall basis, and which over the entire year was a little under 3 percent. Holidays started out gangbusters. The first three weeks in November were a little better than normal, mostly due to new products from Apple, such as MacBook Airs and the iPad Pro. Black Friday, Thanksgiving week and Cyber Week sales were up 5 percent over the previous year and the best in the past four or five years at least. The last four weeks were basically flat, which resulted in that 3 percent number. Product highlights reveal it’s a TV world. For the holiday, TVs are traditionally about 20 percent of revenue and remained so, but the mix was heavily weighted toward big screens. Pricing was really aggressive this year, with the average price being $356 — the lowest seen in seven or eight years. The average price of a 65-inch TV in 2017 was $1,150, and this year it was $830, which drove high volume of ... units of 65-inch TVs, making it one of the big winners. Other big winners included Chromebooks, especially during Thanksgiving week, and AirPods, 8 February 11, 2019 www.twice.com

which were unbelievably strong with sales three times over what they were over the previous year. AirPods or True Wireless? BAKER: AirPods are probably 85 percent, 90 percent of that category. There are a lot of things going on outside of that. We saw really good results for over-the-ear headphones, from Bose and Sony, at the $250 price point. Unexpectedly, there were more entry-level sales than expected. Some of the better products, such as the Sonos Beam Sound Bar and some Bose products, did very well because they were priced a lot lower. Perhaps most surprising is the real strength during Thanksgiving week and Cyber Week was the retailer websites. Retail online has been gaining share in buckets against the competitors in that setting. Online retail has higher shares of higher price point products during the holiday than for online-only websites. One of the big lessons for 2018 is that brick-andmortar retail has learned how to create a blended retail environment and are taking advantage of it. Consumers are more willing to shop around. They’re able to leverage the fact that if they spend a lot of money on consumer electronics, they want to see it and have an experience with it before they buy it, but are also willing to do a lot of online research. However, when it comes to purchases, there is not a material advantage to buying from an online retailer vs. buying from a retailer. TREVOR MAY, D&H DISTRIBUTING: It’s nice to see that balance out after so many years coming in here. It’s been dot-com and e-commerce growth, and the “death of retail” brickand-mortar stores closing. BAKER: We know this to be true. The word always has been that Amazon has half the tech online revenue, but when you get to 50 percent market share, it’s hard to keep growing.

Executive Director, Vendor Management, D&H Distributing DEBBIE SCHAEFFER

Principal, Mrs. G TV & Appliances DOUG WREDE

VP - Consumer Electronics, Nationwide Marketing Group


Tariffs: The Wait-And-See Elephant In The Room? Let’s talk about tariffs and the impact they could have. Will the cost be passed down to the consumer? MAY: It can be disruptive. The 10 percent tariff imposed in 2018 had different reactions by different corporations. Everyone didn’t have a 10 percent price increase across the board. We had a record holiday selling season, but it took us a little extra time to think about what those impacts would be managing the risk and mitigating some of that. It had no disruption to us over the holiday. From my perspective at D&H, we got out of that in very good shape. MCMAHON: Because the 25 percent is supposed to hit us across the board, from your perspective, what does that mean? MAY: We’ve resolved to a wait and see. Once that’s more firm, we’ll prepare ourselves for that. We’ll talk with our manufacturing partners and our customers, and do our best to mitigate disruption to our business. But from my perspective, the 25 will not be digested as easily as the 10 percent was. MCMAHON: I don’t have all the insights to our supply chain for our devices, but I manage all the distribution for Sprint. It touches at some point every bit of supply chain. MAY: A broader scope of products will be affected. MCMAHON: Not just the devices or materials through China, but also production for fixtures for

stores, for example, when remodeling. We might be ordering from domestic production or move into North America. MAY: The manufacturing side kicked off the conversation around our supply chain, where we’re vested, where we have risk and how we mitigate that. Do we need to develop factories elsewhere and take some percentage of our business mix out of that basket? My perception is thinking more heavily on long-term plays around manufacturing product. KEOUGH: That’s what we’re seeing from our partners. They’re reevaluating where production is, now that we have a bit while we’re in this wait-and-see [period]. BAKER: We’re good at that. Despite what you see at the end of the supply chain, when you go back, it’s not a monolithic supply chain where prices are always coming down. A lot of the things going into tech products are commodities and prices fluctuate. Most manufacturers can manage that level of disruption, offsetting costs of steel, etc. We rethink how we’re designing products, rethink what the future set is for the right product. We create something that will fit into what we believe is the right price point. I lean more toward managing by cost increase, but chances are it will be more a commodity cost increase. At some point, it may go away. Where you’re producing at some level is a separate issue vs. our end of the supply chain. Costs do go up on products, and we have always found ways to manage that. ISTOCK/THINKSTOCK

A 50 percent to 55 percent share gain is much harder than a 5 percent to 10 percent share gain. It is a combination of large numbers and the rest of retail catching up that creates a ceiling on things some of the online retailers could do. MICHAEL D. MCMAHON, SPRINT: Sprint is seeing the same trend. I think it is integration of brick-and-mortar and digital. This year there was a massive movement of customers buying online and picking up in store, so we also introduced buy online and pick up at Walgreens because it is a FedEx location. Those two things have had exponential growth since last year. We’re looking at that as the new normal. BAKER: There is still a lot of work to be done with buy-online/pick-up instore because the big share gains seen are mostly in higher price points. Retailers don’t want to do a lot with low-cost cellphone cases and Bluetooth speakers due to the high cost of shipping, etc. They’re trying to balance where they should be competitive and where they shouldn’t. Buy online and pick-up instore works well for high prices. STEPHANIE KEOUGH, WORLD WIDE STEREO: We have buy online/ pick-up in-store. We see success because it guarantees a higher-priced item is there when you get there. It’s purchased, so it’s there and you’re not wasting your time. It’s also the customer service experience when you get there because it is a higher-price ticket and that integration of the product is what so many people are looking for as well. DEBBIE SCHAEFFER, MRS. G TV & APPLIANCES: We’re a single community-based appliance store in New Jersey. We sell TVs, but mostly appliances, delivering to New Jersey, Pennsylvania and New York. You’re right that there has to be integration. We’re a member of Nationwide, which gives us the tools to afford that integration. However, the phones don’t stop ringing. Customers with more questions come to the store, but customers who know exactly what they want don’t want to come in and [instead] buy it over the phone. We really focus on the holiday sales. Black Friday is the entire month of November, probably starting Nov. 10. Customers in 2018 and 2017 who could wait to purchase a washer and dryer, dishwasher or a four-piece set purchased during the holiday weekend because the LG, Samsung and Whirlpool price swings [were] ridiculous. Sales were good, but it was challenging because margins were hard due to special price points. We were up 10 percent from 2017. Luxury appliances were up significantly, while core appliances were on the flat side in November/December. MAY: Welcome to the appliance world turning into the CE world with price compression and margin compression.

www.twice.com February 11, 2019 9


R E TA I L I N G

Are Consumers Ready For Connected Home? All Signs Point To ... Almost Education is still vital in helping this category succeed Appliances are helping marry the smart home. Are consumers ready for the smart home? Is there money in this for retail yet? MAY: The answer is most certainly it has been a great growth category, and it will continue to grow. Without data of that in front of me, home security is by in large making up what smart home looks like. Then you roll in different networking and router configurations people use in their homes for a strong signal, and then the video surveillance and so forth. But the category will continue to grow and innovation will continue with great devices and products that will attract the consumer. It’s weighted in the security aspect of what connected home is today with other stuff on the periphery of that. We’re trying to figure out how to bring a whole one-solution ecosystem together. Right now it’s device by device, resulting in a mix of various hardware and applications to manage. DOUG WREDE, NATIONWIDE MARKETING GROUP: We’re certainly seeing security and networking as the opportunities. Connected home is broken into two categories: custom and do-it-yourself. Custom is whole-home solutions with entertainment, security and networking, which is profitable and doing well. Double-digit growth is in the do-it-yourself network and security market, but this is also intimidating to most consumers. It has a low price point and with margins, you’ll take awhile to get where you want to be. But if you can get the independent channel, we need to focus on getting in the customers’ homes and helping them with their networking. Definitely a lot of opportunity in do-it-yourself when removing customer intimidation. KEOUGH: As an omnichannel retailer, we have an online business and then a CI retail location business. For us it’s the exact same thing. DYI is more online. Networking is the foundation of everything we do, and we build the lighting and the shades, the security, and the whole-home automation. MCMAHON: For Sprint, mainstream products are becoming more mainstream. Apple Watch has been popular the past couple of years and exploded this year. We had strong holiday sales, mainly from customers getting plus-one devices, tablets, and then we sold out of a brand-new product line of a connected vehicle solution with the ability to do diagnostics and tracking of the vehicle. Mainstream products that have been on the market for a while are seeing bigger adoption. BAKER: Going forward, smart home will be a lot more than traditional consumer electronics, more seamless rather than hodge-podge. If you take a product from one line and another from a different line, things don’t always work together very well. Custom instal10 February 11, 2019 www.twice.com

lation is never going to drive volume, but there’s margin there. Do-it-yourself will add incremental volume. KEOUGH: A lot of education has to happen. Bundling, creating that experience. The end consumer doesn’t know what’s available to them. Create a bundle to provide the first, small DIY ecosystem to build from. SCHAEFFER: It’s moving so quickly that the retailer needs to be in it now so they can understand the basics. As the brands continue to evolve and are added onto, we’re in it, understand it, and can show it to the customer. There’s a lot of disruption in the luxury market right now, having to do with being Wi-Fi-enabled and very innovative cooking. Thermador just came out with Wi-Fi-enabled products. People want something cool they can play with on the floor, and that make their lives better with proper use, not just a toy. It’s no different than people buying Teslas today because they want luxury. BAKER: Are you seeing people coming to replace appliances because they’re looking for smart features or because they’re remodeling or it’s free? A third leg would be great, which is: “There is compelling technology and because I see value in that, I’m coming in and buying new appliances, not because I need it.” SCHAEFFER: Some of those products are coming out now. I can’t say someone who has a brand-new over-the-range microwave wants to change it a new Google screen over-the-range microwave. Are consumers embracing voice-control technology or is there still hesitation to bring it into the home? WREDE: Artificial intelligence will change the game. Connected home will continue to evolve, but education is an important part. Mass adoption will occur not because a retailer wants to give it away for free, but because of a massive platform war going on now between Google and Amazon. Are they still waiting for one of the digital assistants to run out? BAKER: We have two smart home platforms. Over time, it’s likely pieces of each one will integrate with the other. Some of that is seen with Apple Music on Amazon and Amazon integrating with Microsoft. How much Amazon will integrate with Google is an open question. K Amazon is public with how they’re flexible with how to C O ST integrate, for example, Google-focused things. NK I TH MAY: It’s helpful to have two readers in the voice-activaK/ OC T tion space, allowing manufacturers of enabled voice activation to IS have two points of consideration that they can adapt to between Amazon and Google.


Coming To Grips With The Double-Edge Sword Of The 'Hypercompetitive' Job Market There is no silver bullet

Speaking of selling up, how is that going to challenge you in the job market? SCHAEFFER: For us, especially on the sales side, it’s very challenging. You have to be knowledgeable to sell the product, not be just an order taker. Otherwise, that refrigerator is coming back. Training, timing, and finding people who want to be in retail sales is hard. Everybody is looking for employees [in New Jersey]. There are no [service] apprentices today. There are knowledgeable servicers who work for us, and I am shocked I have not seen anyone with apprentices. These are older businesses and retirement is not far away. Younger people coming out of tech schools is not the same as working day-to-day. It’s bad. They’re not diagnosing problems quick enough, well enough, and the customers are angry. KEOUGH: World Wide Stereo prides itself on customer service and the mantra of doing well by doing good. So much of our challenge is the technology. Salesmen have to be in the know in all the technology coming out. You service; we install. That combination of being the expert in surround system, video, home theater, lighting, shades, networking is where we struggle to find quality. Everything’s changing so fast. MAY: It speaks to the challenges created by macroeconomics of more job openings, people applying, and low unemployment. The upside is it challenges employers to look at benefit packages, training, retaining people and attracting talent. You can’t just turn-andburn and have a high turnover rate. You have customer service and technology needs, and our industry doesn’t have someone coming out of a trade/training college where they step into this position. It’s up to us to develop and train and retain people to want to stay in your organization for 10, 20, 30 years. MCMAHON: We have over 12,000 employees in our company-owned retail stores, more than 13,000 in our dealer distribution. In the past year, we invested $52 million on retention of our 12,000 employees. It’s hypercompetitive, especially the Northwest with the low unemployment and high-wage tech jobs. I think those investments helped because voluntary turnover is flat, going down year over year. We’re looking at investments in the next 12 months to be competitive and to keep the workforce we have. MAY: That’s a good thing for those that are employed, including us in this room. Those running organizations need to think about how to keep us. What do those attributes look like? BAKER: We talked about smart home, 5G, and technological solutions to help people live better. We’re also at the cusp of IT solutions around services. Maybe you don’t have to be as trained because the devices diagnose themselves? SCHAEFFER: We’re not there yet. BAKER: But new technologies are coming that will make service and installs easier. Virtual reality will help people envision and understand what they’re doing, making the job easier and better. But we’re not quite there. In a couple of years there will be value propositions for retailers and installation around AI. KEOUGH: Part of the whole-home automation is whole home monitoring and getting ahead of it. I know when something goes down in your system long before you do. I have already corrected it and you didn’t skip a beat. No one wants that phone call. No one wants to roll a truck. WREDE: The comments by Debbie and Stephanie resonate in any group setting with retailers. Good work is hard to find whether you’re trying to fill a back office, service department, sales. Hiring the wrong person will cost more time and money in training and firing them than hiring the right person the first time. There is no silver bullet that I can find to solve this problem. Devices that troubleshoot themselves still require manpower and resources. When you do find someone good, a rock star, they’re a flight risk. They’ll get poached.

Are consumers asking for 8K?

MCMAHON: They’re certainly not asking for it. They’re still trying to figure out 4K, which the big factor is it came to market limited by content. [But] any technology for the TV category is good. We need excitement and something to talk about for TVs, and 8K is a good talking point. Price points by Samsung and others are not as high as when 4K first came to market, so it will be more attainable for the early adopter, but it will be limited by content. KEOUGH: We’re talking about picture quality as a selling tool for Samsung, for example, since there is no content. BAKER: You need an aspirational hero product/technology that’s unattainable. We set a ceiling so you feel better about getting a $2,000 4K because you can see what’s coming. KEOUGH: We have the 8K demos. BAKER: The other piece is if prices come down on bigger screens, the biggest challenge (before 4K and 3D nearly killed everybody) was there was no aspirational higher price. There was no way to put value into higher price points. You have to have some balance to the overall market not just with premium products, but add the ability to sell up part of the way. There are $7,000 8K TVs vs. $400 TVs. www.twice.com February 11, 2019 11


R E TA I L I N G

Looking Ahead To A 5G Future What will this mean for handset sales?

Does 5G spell the end of the cable company? MCMAHON: I don’t know that there’s enough bandwidth in over-the-air (OTA) delivery. It might not erase the bottom, but we’ll see carriers will use bandwidth and not leave it on a shelf. Each carrier has announced a mobile 5G solution. MAY: It’s curious to see all the change from my standpoint. I wonder if Wi-Fi coexists with 5G or if you just connect to the cellular 5G. Then around

ISTOCK/THINKSTOCK

AI was mentioned as a game-changing technology. What about 5G? MCMAHON: I had a meeting a month ago with America’s largest retailer. They are interested in 5G because of what is in the marketplace and how it’s the next revolution for technology. It opens the doors to conductivity that we couldn’t have, like autonomous vehicles, since it requires 5G speeds. Logistics, supply chain, product management, and autonomous vehicles are a reality being discussed today. The race will be deployment, the depth and the breadth. Consumer electronics are ready for that adoption; for example, Apple announced for 2020. 2019 will be the first devices and network broad enough for the public to see its speed and capabilities. There are basic platforms in the home that have direct impact with cable companies. Mainstream adaptation and technology implications come out in 2020. BAKER: LTE is probably the most underrated technology advancement in the last 10 to 20 years because that’s what really fueled the growth in phones. MCMAHON: There would be no iPhone success today without LTE. BAKER: It made it usable online. It also fueled the whole app environment. The next interesting piece of 5G will be the things that 5G will be the catalyst for. People are thinking about delivering video to people’s home as being a game-changing use of that technology. MCMAHON: Certainly in two years from now, at least one or two industries will be severely disrupted by 5G. But things that are being imagined today will become practical in a couple of years.

programming, the big networks deal with the cable companies. Do they want to also deal with the 5G providers, as you can see people consuming so much content on their devices? Do they go through cable companies by dealing with the two people who deliver content? MCMAHON: If you look in the wireless space, how many of the major companies have tried to become a media company instead of the dumb pipe (delivery of service)? Verizon, Sprint, T-Mobile. It will be interesting to see whether economics favor being the dumb pipe vs. the content provider. There have been a lot of failures over the past three years. Will 5G and foldable phones boost handset sales? MCMAHON: It depends on the phone capabilities.

As an observation from wireless sales, customers across all carriers have been upgrading at a slower rate. I’m not sure it will be an upgrade driver. For tech folks, or if there is something compelling them to make the change, they may change. BAKER: I agree we’ll see a shift around that for a couple of years, until there are compelling use cases. The biggest challenge is battery life and people that are used to form factors and improvements. Going from 3G to 4G improved everything. MCMAHON: I think that’s exactly right. BAKER: Also, does 5G disrupt the phone around video or mobility? Can you talk around that? Like you said, there’s stuff going around we’re not aware of, people thinking how they can disrupt different pieces. Different parts of hardware can be disrupted by thinking about connectivity differently.

What will be the breakout products or catalysts for 2019? What product or technology will have the largest effect on your business? MCMAHON: We’ll have a 5G device announced to come out second half of 2019, but I think it will be a continuation of those products that are more mainstream. We’re beginning to see an explosion of growth in connected car devices and plus-one devices with our base of 30-some-odd million customers. They’re now taking advantage of alternate technologies or adding a new connected device. KEOUGH: I don’t necessarily know that it’s breakout. As leaders in the industry, we’re always ahead. We’re having conversations about 5G and 8K. For the end consumer, they’ll wrap their arms more around AI, voice control. The mainstream end consumer is not there yet. They may have a product or two, but it will broaden within the home. WREDE: No silver bullet in our category either. I think 8K and connected home will be growth opportunities for 2019. 12 February 11, 2019 www.twice.com

BAKER: I agree that while there are huge growth opportunities, there’s also a little bit of risk in the explosion in computer gaming, video games, streaming, Twitch, sports. There’s a huge amount of things going on there. It impacts a lot of different categories. I’m not sure we’ve seen the end of the impact. KEOUGH: There’s a new demographic for targeting in that industry. BAKER: Gaming is changing within society as well. There’s a college degree in gaming. They have 15,000 people going to watch eSports. Some of us older people don’t understand all these things, but it is a game-changer. KEOUGH: It is. We’re having gaming events now to showcase you don’t have to put on headphones to have that experience. You should have a gaming experience in your home theater. SCHAEFFER: This is going to be in home appli-

ances, mostly kitchen. I think this will bring the consumer back into the kitchen to cook. There is integration with companies like Yummly. Whirlpool bought Yummly, and it is involved with other appliance brands. GE just partnered with Hestan Cue. These are all to make the consumer successful in the kitchen so they enjoy cooking. I think that will be a big play this year, as well as for the industry ­— this is the year for the replacement. 2004 was a big year for appliances. Now we’re in the 16th year of buying cycle when appliance sales were the biggest they were in the world and this will be the year of replacement. MAY: Representing D&H as a national distributor and our breadth of products, manufacturers, and customers, the hot products that come out next year will be in a key position to support that growth and our partners who want to buy those products from us.


Choosing Business Wisely: The Pros & Cons Of Outsourcing

www.twice.com GETTY IMAGES/FRANCESCOMOUFOTOGRAFO

By Alan Wolf Given the growth of home automation, and the concomitant dearth of skilled — let alone certified — tech labor, many companies find themselves in a quandary. Already booked months in advance, do they turn away business or do they put their reputations on the line and turn to local or national third-party providers like Herman Integration Services to supplement or assume big jobs? To the heads of the industry’s four major CI and integration buying groups, the answer is a unanimous “no” to outsourcing … with exceptions. Their advice to their members: Keep the complex installations in-house, where they have complete control over the myriad subsystems that can go wrong, and, if necessitated by the labor crunch, relegate more basic services to trusted outside agencies. Other exceptions apply as well. Specialized areas such as HVAC, high-voltage electrical work and custom cabinetry are routinely sub-contracted to licensed or otherwise highly-trained tradespeople, and dealers will often refer clients with out-oftown properties, such as vacation homes, to a fellow group member in that market. But the best way to avoid the outsourcing dilemma, at least for the short term, is to manage your calendar wisely by picking and choosing the most profitable jobs, even if that means walking away from opportunities, the group execs say. Longer term the answer lies in training, whether in-house; through sponsorships to an outside resource like New Hampshire’s respected Maverick Technical Institute (MTI); or by mounting an industrywide effort to draw a new generation to technical careers in custom integration. Short of that, the group leaders say, outsourcing is largely shunned. “A few of our dealers have used Herman, typically for the simplest tech like pulling wire, or if a job requires more bodies,” said Dave Workman, president/ CEO of the $5 billion ProSource group. But by and large, ProSource’s 550 specialty retailers and custom integrators “haven’t shown an appetite for outsourcing more advanced work, for fear of messing up the job. The complexities of design don’t lend themselves to handing it off.” As a consequence of that reticence, and the tight tech pool, “Dealers have come to be more selective; they’ll bid on projects to maximize their available labor,” he said. Jon Robbins, executive director of Home Technology Specialists of America (HTSA), the self-described national trade consortium of hybrid retailers and custom integrators, concurred. “The vast majority of our members would rather turn down a job if they couldn’t have complete control over a project,” he said. “It’s a challenge, leaving business on the table. But the way to address it is to provide expansive education to project managers and technicians.” To that end, HTSA has partnered with MTI to create a group-exclusive Masterclass training program for installation technicians. Over the past two years more than 200 HTSA trainees have enrolled in the special week-long curriculum, Robbins said, which produces better mechanics with higher retention rates.

February 11, 2019• Volume 34 • Issue 3

FOLLOW US @TWICEOnline www.facebook.com/TWICEOnline CONTENT VP/Content Creation Anthony Savona Content Director Lisa Johnston, lisa.johnston@futurenet.com Senior Content Producer Alan Wolf, alan.wolf@futurenet.com Contributors: Karen Mitchell, Henry St Leger, Stewart Wolpin Managing Design Director Nicole Cobban Design Director Walter Makarucha Jr Production Manager Nicole Schilling ADVERTISING SALES VP/Market Expert, AV/Consumer Electronics, Education & Pro Audio Adam Goldstein, adam.goldstein@futurenet.com, 212-378-0465 SUBSCRIBER CUSTOMER SERVICE To subscribe, change your address, or check on your current account status, go to www.twice.com and click on About Us, email futureplc@computerfulfillment.com, call

Ironically, MTI itself was born of the labor shortage four years ago, when custom integrator Dennis Jaques couldn’t find enough qualified technicians to staff his booming Maverick Integration business in Nashua, N.H. Hank Alexander, director of Home Technology Specialists Nationwide (HTSN), the custom integration wing of Nationwide Marketing Group and a partner of HTSA, recounts a similar situation within his own group. That’s when South Carolina appliance, electronics and furniture dealer Jeff Lynch Appliance & TV Center, which had been outsourcing installation labor, went out and acquired the service provider. “Labor is a tough issue in custom-install land,” Alexander said. “I don’t see the younger generation entering the business. But any time you can bring your labor in-house it’s better.” One exception, and a major new opportunity, is outsourcing the installation of “over-the-counter”type products, he said, like Nest and Google thermostats, doorbells and security cameras. “It’s a great place to outsource, to go to a local company,” he observed, “and it gives you time to get to a Control4 project. But I wouldn’t do it for real automation jobs, where you’re integrating lighting, HVAC and other complex systems, and have so many moving parts.” Richard Glikes, founder and president of the sevenyear-old Azione Unlimited integrator group, also advocates outsourcing lower-tech work, like pre-wire, to professional resources like Herman when necessary. He further laments the tight labor market that keeps tech salaries high and retention levels low. “The problem with this industry is we pass people around. They’re bribed to leave, and we wind up overpaying,” he said. “I’m hoping CEDIA comes up with an education solution.” Relief may be on the horizon, Glikes added, albeit from the economy. “We’ve had eight or nine years of uptick and we’re overdue for a slowdown. We’re due to take a breath.”

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All contents © 2019 Future US, Inc. or published under licence. All rights reserved. No part of this magazine may be used, stored, transmitted or reproduced in any way without the prior written permission of the publisher. Future Publishing Limited (company number 2008885) is registered in England and Wales. Registered office: Quay House, The Ambury, Bath BA1 1UA. All information contained in this publication is for information only and is, as far as we are aware, correct at the time of going to press. Future cannot accept any responsibility for errors or inaccuracies in such information. You are advised to contact manufacturers and retailers directly with regard to the price of products/services referred to in this publication. Apps and websites mentioned in this publication are not under our control. We are not responsible for their contents or any other changes or updates to them. This magazine is fully independent and not affiliated in any way with the companies mentioned herein. If you submit material to us, you warrant that you own the material and/or have the necessary rights/permissions to supply the material and you automatically grant Future and its licensees a licence to publish your submission in whole or in part in any/all issues and/or editions of publications, in any format published worldwide and on associated websites, social media channels and associated products. Any material you submit is sent at your own risk and, although every care is taken, neither Future nor its employees, agents, subcontractors or licensees shall be liable for loss or damage. We assume all unsolicited material is for publication unless otherwise stated, and reserve the right to edit, amend, adapt all submissions.

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www.twice.com February 11, 2019 13


R E TA I L I N G

By Alan Wolf GameStop has called it quits on its eight-month-long search for a buyer. The No. 1 gaming retailer had been shopping the company around since June as part of a broader strategic reassessment of the business. The revaluation followed a series of executive suite shuffles last year — and the broader challenges of Cloud and mobile gaming, and developerdirect downloads — that are eating into the specialty chain’s sales. The retailer announced in late January it has “terminated efforts to pursue a sale of the company,” blaming a lack of favorable financing terms that would be commercially acceptable to a prospective buyer. It said it had held discussions with several third parties. Instead, GameStop will consider how best to use the $735 million in cash it received in the Jan. 16 sale of its Spring Mobile business, comprised of 1,284 AT&T mobile stores, to Prime Communications, another authorized AT&T retailer. Spring Mobile, along with its Cricket prepaid mobile chain, Simply

GETTY IMAGES/MICROVONE

GameStop Gives Up Search

Mac Apple reseller stores and ThinkGeek collectibles shops, were part of a diversification effort under former CEO Paul Raines, who died in March. The company said it may use the Spring Mobile proceeds to pay down debt, buy back stock and/or reinvest in its video game and collectibles businesses, while continuing its search for a permanent CEO. GameStop has been led on an interim basis since May by Shane Kim, a board director and former Microsoft corporate VP.

The company and its outside consultants are also continuing a “comprehensive review” of all strategic and financial alternatives. The chain recently reported a 5 percent decline in total worldwide holiday sales, to $2.6 billion, for the nine weeks ended Jan. 5. Comp-store sales rose 3.6 percent in the U.S., albeit due to a fiscal calendar shift and the October launch of “Call of Duty: Black Ops 4.” Broken out companywide by category, sales of new hardware slipped

6.1 percent; sales of new software declined 8.3 percent; and sales of preowned hardware and software fell 16.4 percent. Conversely, sales of video game accessories, largely controllers and headsets, grew 28.7 percent, and collectibles sales rose 3.7 percent to $219.2 million. Sales at GameStop’s mobile and Apple stores sank 19.3 percent during the period due to a decrease in store count and traffic, the company said.

Synchrony Renews Sam’s Club Partnership

Capitol Has A New Look Capitol, the Eagan, Minn.-based consumer tech distributor for residential systems and light commercial contractors, unveiled a new logo as part of its 2019 rebranding campaign. By Alan Wolf Walmart has dropped a three-month-old lawsuit against Synchrony, clearing the way for the financial services firm to continue issuing private-label credit cards for Sam’s Club. The dispute stemmed from the discounter’s decision last summer to move the private-label credit card business for its namesake Walmart stores and website to Capital One Financial Corp. According to Bloomberg, the retailer sued Synchrony over ownership of the $10 billion portfolio, which the firm had planned to keep or sell to Capital One. In a statement released by Synchrony, the company said it “has reached agreement on the sale of the Walmart loan portfolio,” which is expected to transfer late in the third quarter or early in the fourth quarter. In turn, Walmart has agreed to dismiss the lawsuit, and has extended Sam’s Club’s 26-year Synchrony partnership. The length of the renewal was not disclosed.

14 February 11, 2019 www.twice.com

“We are very pleased to have reached these agreements,” said Synchrony president/CEO Margaret Keane. “Obtaining certainty around the Walmart portfolio and a renewal on Sam’s Club is a great outcome for the company.” As part of the extension, Synchrony will continue to manage and service co-branded and private-label credit card programs for the wholesale club’s Club and Plus members across its nearly 600 locations. The plastic, which doubles as membership cards, variously offers cash-back rewards, in-club cash access, special financing promotions, online account management, and scan-and-go integration. Synchrony also provides customized financing programs to retailers including Amazon, Lowe’s and the Nationwide Marketing Group, as well as to the health, auto, travel and home industries, racking up more than $140 billion in financed sales. It presently maintains 80.3 million active accounts.

“Capitol is in the midst of a rebranding effort, driven in no small part by our marketing manager and graphic artist, Megan Larson,” said Curt Hayes, Capitol’s president and chief financial officer, in a statement. “From our website, collateral and eFlyers to our customers, Megan is creating an updated, unified appearance for all things Capitol, which of course begins with a new logo that features a fresh appearance while still being recognizable to our longtime clients.” “The design of our new logo communicates who we are today and captures many of our core values,” said Larson. “Our refreshed look symbolizes our expertise of the products we sell and the simplicity of working with us.” The new logo will be included anywhere Capitol has a physical or digital presence.


THE TWICE GUIDE TO

BUYING GROUPS

SPECIAL ADVERTISING SECTION GETTY IMAGES/PEOPLEIMAGES


TO BUY OR NOT TO BUY …? That’s the big question for 2019 By Karen Mitchell What does the kitchen have to do with state of the art consumer tech trends? Let’s just say there’s plenty on the table. Top buying group industry leaders shared with us their insights for the coming year, including the growing trend for aspirational buying and more connectivity. “From the tech standpoint there were some lean years before 4K when it was difficult to sustain margins for our partners in the independent channels and brick and mortar,” said Tom Hickman, president, Nationwide Marketing Group. “But now we’re seeing a nice transition coming on the heels of 4K, into 8K, bringing more opportunities.” A welcome trend, he added, is in the connectedness of everything moving into the consumer’s kitchen, such as voice through Google Home Hub or through devices from Whirlpool and others. “This is going to be a large part of our business going forward as we are focused on the connected home. I used to swear that the connectedness and sharing came through the living room, but not anymore. It’s probably going to be through the kitchen.” With 200-plus vendor partners, Nationwide covers several categories with unique opportunities for all partners, Hickman said. “We represent suppliers in various stages of embracing new technology and we’re building on those relationships. We already have long term relationships with Nest and Google on the digital side and we continue to leverage those partnerships.” Forecasting for 2019 will prove to be difficult, though, as there are numerous short-term obstacles that cloud the ability to clearly judge what outcomes and trends are extant, said Richard Glikes, president/ CCO, Azione Unlimited. “Issues like tariffs, stock market gyrations, international tensions, and presidential vicissitudes make this task challenging,” he noted. “My best guess is it will probably be considerably slower than the last three years. Consumer electronics are a luxury and not a necessity. This faucet is easy to turn off. Although the underlying economy is strong, the trust in stability is waning.” Although tariffs to date have had a modest impact with a few vendors raising prices a slight degree, everyone is terrified of 25 percent tariffs, which would affect prices dramatically, Glikes said. “This brings in the problem that clients have quotes for jobs based on pricing that was lower at the time they signed the contract. Dealers would be absorbing this differential, which would severely affect their bottom line.” Dealers buy "just in time" while vendors have to look into their crystal ball and predict future appetite for products, he explained. “The vendors have a much more difficult job. It won’t take much for this economy to flip in either direction. This makes GETTY IMAGES/MASKOT

life very hard when forecasting. Coin flips?” David On an interesting note, Glikes added, Workman, the industry is looking at more indus- ProSource try consolidation this year. “You have big players like Snap, Control4, Nortek, Legrand, and Samsung to some degree, each absorbing smaller companies to round out their portfolios. Big fish love to eat smaller fish.”

Ask The Pro

At ProSource, president/CEO Dave Workman noted that the slight softening with the higher demographic consumer is believed to be temporary given all of the uncertainties that have been in the market currently, including those stock market gyrations, Fed increases, trade wars and implications, along with the rancor coming out of Washington. ‘The general consumer appears to be healthy in their spending habits,” he said. “However, we saw a marked slowdown in spending on the more premium priced products through the holidays. The outlook for now is a cautious one. While not expecting anything dramatic, we see a continuation of this trend into 2019 until such a time as things appear to settle down and there is more consistency to bring back the confidence necessary for consumers to luxury spend again. I think the outlook is similar for both dealers and vendors as we are mutually dependent on each other to our results.” “Our members do a great job closing a consumer once they are in one of our stores," noted Jim Ristow, AVB/BrandSource CEO. "The independent has traditionally struggled with consumer awareness to get the consumer in the store, and successful BrandSource members have reversed that trend by leveraging our industry-leading digital marketing solutions. ... 2019 will see more innovation and tools to drive even more business into our members business."

The Appliance Game

“From an appliance standpoint, we’ve been used to looking at these humdrum, white boxes,” said Patrick Maloney, senior VP, Nationwide Marketing Group. “At CES, we saw more and more products with interconnectivity from both domestic and foreign manufacturers. There’s significant investment and effort to ensure that connectivity comes through the kitchen.” “The average consumer does not necessarily understand how ‘connected’ works,” noted Malone. “That’s why we believe these appliances will be sold through independent retailers, where consumers can benefit from educated sales associates to help them through the process. We’re spending a lot of time educating our members about what this will mean in the future and how they should prepare for this consumer.” Historically, regardless of the category, new product innovation has thrived when launched through

Richard Glikes, Azione Unlimited

Tom Hickman, Nationwide Marketing Group

Patrick Maloney, Nationwide Marketing Group

Jim Ristow, AVB/ BrandSource

independent retailers, so it’s natural, as tech goes forward, that independent retailers remain the backbone of growth in the pipeline, he noted. “The Sears consumers fit into the same demographic of independent retailer structure. We’re solution-oriented, focusing on solving problems for consumers. Sixty percent of consumers buy appliances under duress, when something is broken. Our challenge is how to make sure we present top-line awareness for our members and deliver the right model to fit the home. That leads to an upsell. If a consumer’s refrigerator goes out, there’s an opportunity to add a new range and dishwasher to the sale. We’re bullish on these chances to push premium and luxury goods, especially with the tech boom that’s coming.” Even with the popularity of door-in-door refrigerators, the Family Hub, and connected appliances there are opportunities to extend this technology to new price points and categories, Maloney said. “We love to see consumers buy not under duress but because they want the latest and greatest and have a fear of missing out. That’s the excitement in the appliance market. We still have that 60 percent buying under duress, but now we have a good shot at going after the other 40 percent who want in vs. need in.”

The Bottom Line

Despite the challenges, industry leaders remain cautiously optimistic. “Several years of innovation and hard work by our members and BrandSource has allowed us to grow same-store share the last two years in a row," said Ristow. "Although predictions for the overall industry are for moderate growth, we believe our members will fare much better. We are looking forward to continuing our momentum with another strong year." It’s been a good ride, Glikes concluded. “How much longer can this go on? Believe it or not, the glass is half full. We’re on a roll. Azione Unlimited has new vision and mission statements to guide us through any morass with 200-plus smart dealers and 50 committed vendors delighted to help one another.” “If you told me, several years ago, that 2019 would be a great year in A/V, that there’s plenty of demand, with predatory pricing at lower levels abated, I would have been surprised,” Hickman said. “We feel good about A/V; housing is still strong, there’s low unemployment, and lots of reasons to upgrade to include voice integration. Anytime there’s evolution or revolution, that’s great for A/V."

SPECIAL ADVERTISING SECTION || FEBRUARY 11, 2019

17


LUXURY

Stelé’s Dux bed with Alexa speaker

High-Tech Luxe Beds Know How You’re Sleeping (And Snoring) By Stewart Wolpin A high-tech bedroom used to mean a rotating or vibrating bed (or both), strobe or not-too-subtle colored lighting, and perhaps Barry White sensually crooning from in-wall speakers. But at least three bed makers — Sleep Number, Magniflex and Duxiana — are integrating smart technologies into their mattresses and box springs to aid REM rather than ribaldry. For instance, Sleep Number has integrated its sensing SleepIQ technology, which measures more than 8.5 billion full-body biometric data points every night, into all of its adjustable beds. SleepIQ measures a variety of somnolent data, including movement, breathing rates, heartbeat, and sleep habits, and automatically adjusts the bed’s firmness to deliver a higher-quality siesta, all tracked on the SleepIQ app. If someone is snoring on his or her back, for example, the base automatically raises the snorers’ head seven degrees to hopefully relieve these noisy symptoms. And to replace a heart-attack-inducing buzzing, a Sleep Number bed instead sounds an alarm when it detects dreamers have drifted into their lightest stage of slumber during their desired wakeup time window. At the top of the Sleep Number SleepIQ line is its limited-edition 360 iLE smart bed with FlexFit 3 ($7,248 for California king), which allows for nearly 22 February 11, 2019 www.twice.com

Sleep Number’s 360 iLE smart bed with FlexFit 3

infinite customized positioning and firmness on either side of the bed, under-bed lighting for latenight foray guidance, and foot warming.

Automatically detecting and alleviating snoring is also one of the attributes of Magniflex’s Smartech beds (queen: $16,999, king: $19,999). Like the Sleep


Magniflex's Smartech bed

Number, Smartech automatically recognizes when a sleeper is snoring, shifts the bed position until the snoring stops, then returns to its original position. More broadly, Magniflex’ integrated sleep system

technology records and analyzes dormant data including hours slept, average heart rates and fluctuations throughout the night, average respiratory frequency, bedroom brightness and noise level, wake

up times, and more, all of which is displayed either on the Smartech smartphone app or on the Smartech website. The Smartech bed itself includes both a high-tech mattress and base. Included is a removable topper with memory foam, gel foam or latex inserts so both snoozers get a choice. Smartech’s split adjustable base offers includes one-button preset positions to optimize muscular tension, improve leg blood circulation in the legs, or for reading, along with three “soft” wake up settings, including an option to have the mattress slowly raise a sleeper’s head and provide a massage while a customizable LED gradually illuminates from the bottom. For years, the Duxiana folks have stressed its beds’ advanced comfort levels sans tilts or bends. But this summer, the luxury Swedish bed maker has partnered with audio expert Stelé to create the Dux bed with Alexa speaker “discreetly mounted to the underside of the bed” ($4,950 for king, also available in queen and California king). The Dux app creates “a bedtime concierge that handles everything from dimming the lights and guiding your evening meditation, to changing the temperature for ideal sleeping conditions consumers,” according to the company.

High-End & High-Tech Comfort In Every Room Of The House By Stewart Wolpin Considering the number of intensely personal activities performed behind their closed doors, it’s somewhat surprising that the bathroom is seen as the last high-tech-free bastion. But bathroom fixture and accessory suppliers are making up for lost time by creating a wide swath of smart personal care and hygiene products that increase both bathroom comfort and utility. Toto has long been at the forefront of raising a bathroom’s luxuriousness and IQ, but this year has added what may be the smartest bathroom tech ever — toilets that know when to flush themselves. At CES, Toto unveiled an auto-flush sensor that flushes as soon as a user rises and walks away. No hand waving or other weird gestures, no buttons to push — and no germ-spreading (although models with the auto-flush sensor will still include a manual flush option). The auto-flush feature will be available on Toto’s Aimes, Legato, Nexus, Connelly and Aquia IV models, all of which feature a variety of other remote controllable luxurious personal comfort and cleaning extras, all priced around $2,000. Also enabling germ-free hands-off flushing is Kohler’s smart one-piece dual flush and unusually rectangular Numi toilet ($8,000), thanks to a sensor embedded in the standard trip lever. The lavish-appointed Numi also is equipped with a PureWarmth motion-activated toilet seat with temperature and duration controllable via the Konnect app or a touchscreen remote, along Bluetooth speakers with an SD card slot, and a nightlight. Taking a shower also just got Kohler’s a lot smarter and hands-off. At Numi toilet CES, Moen added Alexa voice control to its U by Moen shower fixture (two-outlet controller/valve: $1,160, four-outlet: $2,200), and will add Apple HomeKit/Siri control in the next few months and Google Assistant operation

The SmartMirror from Philips

in the spring. Users can voice command their shower to remotely start, stop and pause, set a precise water temperature, and program and trigger routines that can combine controlling the shower with smart lighting and smart window blind operations. Plus, the WiFi-connected digital shower controller features a five-inch, non-touch, LCD screen that provides feedback on shower status. Kohler’s DTV+ showering system similarly allows voice control, via the company’s Kohler Konnect technology, for adjusting water temperature, showerhead and body sprays, music, lighting, steam and shower duration.

For grooming, there are an exponentially expanding number of smart digital assistant-assisted mirrors with built-in speakers. Some smart mirrors such as Kohler’s Verdera are built-in, others are designed to sit on your vanity such as the HiMirror Mini ($119), which offers a virtual “My Beauty Box” that can populate a user’s collection of skincare products to keep track of product efficacy and the SkinSAFE app to that reviews beauty product ingredients and allergens. Possibly the most ambitious smart bathroom mirror is Philips’ aptly named SmartMirror, which the company previewed at CES. SmartMirror connects to a variety of Philips sensor-laden smart health and personal care products such as its Sonicare toothbrushes, Philips Smart Shaver series 7000, skin care, heart and blood pressure monitors, and scale, and uses live animations to guide users through best-practices during daily routines. No word on when the SmartMirror actually be available, however.

www.twice.com February 11, 2019 23


AUDIO/ VIDEO

REVIEW

Sennheiser Momentum True Wireless By Henry St Leger Though conventional wisdom has long placed limits on what can be achieved with headphones’ more compact, in-ear counterparts — or over a wireless Bluetooth connection — the Sennheiser Momentum True Wireless earbuds look to continue the company’s audio heritage within those physical constraints. When we first tried out the earphones at IFA 2018 we were immediately impressed by the quality of both the audio and the craftsmanship that had gone into these compact, untethered earbuds. But at $299, they’re far from cheap — so are they worth the asking price? Design The Sennheiser Momentum True Wireless earbuds are the company’s smallest offering yet, doing away with the neck cable on the Momentum Free earbuds, and packing in a brand-new 7mm driver to boot. They carry the classic silver detailing of other Momentum earphones, with a pleasing pattern of magnetic gold points that connect each earbud to the accompanying carry case, securing them in place with a satisfying click. The earbuds can only carry four hours of charge, but the charging case is able to carry two full charges for each earbud, giving you 12 hours in total — while the compact USB-C carry case is highly practical for transporting and charging on the go. The silicone buds are predictably lightweight, and easy to place in your ears, and they’re certainly

24 February 11, 2019 www.twice.com

comfortable enough to wear, even if the boxy shape and lack of rubber wing tips don’t help matters. Three ear tip sizes are provided, and finding the right fit is crucial in order to prevent them from falling out. These are earbuds for the commuter, really. While we found they stayed in well enough for light exercise, there’s a limit to what you can do to prevent true wireless earbuds from falling out. Those looking for earbuds that will survive circuit training or ultra marathons would probably want something made with that activity in mind. The touch controls are intuitive — you use a simple tap on the left earbud’s metal plate to pause/play, or a double tap to skip a track. Holding a finger

OUR VERDICT With stylish design, smart controls, and professional sound, the Sennheiser Momentum True Wireless earbuds are a great cordless alternative to those fed up with trailing cables or wired remotes.

FOR + Strong full-range sound + Stylish design + Case comes with two full charges

AGAINST - Imprecise volume control - Could be more comfortable

Read the full review on TechRadar.com.


on the right or left earbud turns the volume up and down respectively. It all works well, circumventing the fiddly nature of cable-line controls or having to constantly get out a phone, though prodding audio kit into your ears all day isn’t a recipe for comfort. We would have liked the ability to change the rate at which the volume increased or decreased too — we sometimes found ourselves struggling to time how long to hold down the volume control, and slowing things down a notch would have helped with this. But things get really hands-free with the smart capability. Tapping on the right earbud activates a phone’s smart assistant — Siri, Google Assistant, and the like — to navigate a music library or streaming apps with just your voice. Performance As we’d expect from the brand, the audio doesn’t disappoint. The usual high-standard sound profile of the Momentum range is here, with the boost from Sennheiser’s new 7mm driver resulting in a controlled, capable audio performance beyond what you might expect from “true wireless” earphones. It’s not as wide a soundstage as we’d like, and some of the low-end frequencies can muddy into each other slightly — when listening to Paramore’s “Misery Business” the True Wireless could struggle to distinguish between percussive instruments. You won’t get the head-banging bass of Beats headphones, either. Mid and high frequencies are wonderfully balanced, though, with detailed vocals that draw out Hayley Williams’ pounded syllables and intakes of breath between notes. The Momentum sound natural, and will suit just about anything in a music library, even if they favor mid-range instruments and vocals over weightier sounds of house music, or drum and bass. The Transparent Hearing feature — which records outside noise and then transmits this into your ears to keep you aware of your surroundings — is somewhat useful, but the sound isolation on these small earbuds isn’t really enough to block out the noise around you anyway. You may find the feature puts you at ease when walking in busy places, but it makes only a small difference to what you can or can’t hear.

Optoma’s P1 Is Next-Gen & All-In-One Optoma took the wraps off its P1 Smart 4K UHD Laser Cinema at CES last month, its next-generation all-in-one smart home entertainment system. The P1’s centerpiece is an ultra-short-throw (UST) 4K Ultra HD projector that provides a 3,000-lumen, 8.3-million-pixel image with HDR10 and hybrid log gamma (HLG) compatibility for deep blacks, bright whites and lifelike color, the company said. The projector is coupled with an integrated soundbar designed by NuForce that features individual woofers, aluminum full-range drivers and wide frequency response for clear and balanced sound, plus Dolby Digital, Dolby Plus and DTS audio decoding for an immersive viewing experience. The system also offers smart-home compatibility with Amazon Alexa and Google Assistant; IFTTT support for smart-home automation with IoT devices; and easy access to popular streaming services including Netflix and YouTube through the Optoma Marketplace. The system is expected to hit a street price of $2,999 when it ships late in the second quarter, although the cost had not been finalized at press time.

the Apple AirPods instead — they’re almost half the price, after all — or one of the cheaper options on our list of the best true wireless earbuds. But the Momentum still offer premium audio in a smart

and well-designed package. While these earbuds are far from the first true wireless examples we’ve seen, they’re some of the most accomplished in their category.

Final verdict With stylish design, smart controls, and professional sound, the Sennheiser Momentum True Wireless earbuds are a fantastic cordless alternative for those who aren’t fans of trailing cables or wired remotes. For an iPhone user, it’s hard not to recommend www.twice.com February 11, 2019 25


AUDIO/ VIDEO

REVIEW

Samsung 75-Inch Micro LED TV

By What Hi-Fi Staff The move away from backlighting for TVs is well under way, but while most manufacturers have already succumbed to the self-emissive delights of OLED, Samsung has kept its powder dry. Why? It reckons OLED is inherently too limited in terms of brightness and prone to degradation over time on account of its organic compounds. Samsung’s alternative is a two-pronged approach. On the one hand, it’s proving that there is actually life in the old backlight yet, with the company’s 2018 flagship QLED, the Q9FN, doing a rather convincing job of taking the fight to its OLED rivals. At the same time, it’s pursuing an alternative selfemissive tech: Micro LED. We’ve actually known about Samsung’s Micro LED intentions for a little while now. At last year’s CES the company unveiled a 146-inch modular Micro LED display called The Wall, which is already available for commercial applications. This year the Wall concept expanded further with a monstrous 219-inch version and a number of demonstrations of configurations in peculiar shapes and sizes. The company sees a point in the future when we have these Micro LED displays dotted all over the house: when we cover a whole wall in modules to create a floor-to-ceiling display, have a thin strip of 26 February 11, 2019 www.twice.com

them in the office to display interactive information, or perhaps a single module in the kitchen as a touchscreen panel for recipes and the like. But even Samsung admits that that’s a long way off, and it’s keen in the meantime to convince us that Micro LED is also the next step in the evolution of the more traditional TV; hence the announcement of a more consumer-friendly, 75-inch Micro LED TV at this year’s CES. Design One of the coolest things about Micro LED is that it’s incredibly thin — thinner even than OLED. Micro LED panels don’t require bezels, either. In fact, being bezel-less is really inherent in the design, because each Micro LED TV is actually constructed using a number of small modules arranged in a grid pattern — in the case of the 75-inch model we’ve seen, there are 64 of these modules arranged in an 8x8 pattern to create a large display in a traditional 16x9 ratio. Interestingly, on both of the occasions that we’ve seen the 75-inch Micro LED model in the flesh, it’s been contained within some casework. On the first occasion it was in a simple, black, traditional TVshaped chassis for ease of use and transportation, and when demoed at CES 2019 it very much appeared

to have been mounted into a wall. In other words, we’re yet to see the final design of this core consumer model, with the focus so far having been entirely on picture quality. That said, the various other, peculiarly shaped Micro LED configurations also shown at CES prove the bezel-less concept. Features The prototype 75-inch Micro LED model we’ve seen has a 4K resolution and, while we’re sure Samsung would prefer to launch with an 8K set, it doesn’t sound as if that will be possible at this sort of size

FOR + Fabulously bright and vibrant + Awesome blacks + Perfect viewing angles + Super-thin

AGAINST - Still a long way off - Big - Will be very expensive at first

Read the full review on WhatHiFi.com.


for a little while. Samsung says that its first consumer Micro LED models will hit a peak brightness of around 4,000 nits — the same as the company’s current Q900R range of 8K QLEDs — but that 10,000 nits will be possible before too long. And, of course, because Micro LEDs are self-emissive and don’t utilize a backlight, one pixel can be lit as brightly and/or colorfully as it likes while the one next to it is simply switched off and, therefore, perfectly black. In other words, it should provide the perfect blacks and precise contrast control of an OLED TV with vastly increased brightness (it’s widely believed that OLEDs will never be able go much brighter than around 1,000 nits). Another key technical feature of Micro LEDs is their inorganic nature, which gives them a longer, more consistent lifespan than OLEDs. Samsung said its Micro LED sets will last for 100,000 hours, which is over 11 years of non-stop use. They’re said to be very power-efficient, too, at least partly because they don’t need to be shone through a color filter. The light from the LEDs get straight to your eyes, so is effectively brighter with less effort.

ity offered by such an approach. More likely, it seems, is that discrete partnering sound systems will be offered. The approach sounds as though it could be similar to that of LG’s Wallpaper OLEDs, which consist of an ultra-thin display connected to a separate soundbar that also houses the inputs and processing bits Jonghee Han, president of Samsung’s visual display division, introduced the downsized and pieces. It’s also posMicro LED display during a pre-CES event last month. sible that Samsung will offer a number of partnering This longevity and low power consumption is besound setups, based on price or requirements, poshind Samsung encouraging us to think of its Micro sibly leveraging the various brands that it now owns LEDs as more than TVs for simply watching video. as part of its Harman business, such as Arcam, JBL The company said these displays can be always-on, and Harman/Kardon. displaying art, photos and/or live information. It also We’d also like to see the Micro LED TV offered entalked about them doubling up as virtual fish tanks tirely free of speakers, allowing you to add the sound or windows when not in “normal” use. (Think of this solution of your choice. as an extension of the company’s existing Ambient mode, and you’ve likely got the right idea.) Picture This “lifestyle” approach also extends to operaAs you can tell, there’s still a lot about the 75-inch tion. Samsung isn’t being specific at this point, but Micro LED TV that we don’t know, including what expect there to be a heavy focus on voice-control it will really look like and how it will sound. That’s over a traditional remote. The company’s already because the entire focus of our demos were on the heavily pushing this agenda, with its 2019 QLED TVs picture quality and that’s absolutely fine with us begetting a new, more intelligent version of its Bixby cause it’s extremely impressive. smart assistant. While, as mentioned above, Samsung said its consumer sets will be 4,000 nits at launch, this protoSound type’s peak brightness is "only" 1,000 nits. It looks Another element of the 75-inch Micro LED TV that fantastically bright, though, largely thanks to that apparently isn’t yet settled is how it will produce lack of a color filter. This is a stunningly punchy and sound. Traditional TV speakers require a bezel and/ vibrant image with truly exceptional colors. Everyor add overall thickness, both contrary to Samsung’s thing looks real and lifelike to an extent we’ve genuMicro LED goals. inely not experienced before. The company said it could go down the acoustic The demo footage we’ve been treated to so far surface route used by Sony on its OLEDs — which contains lots of nighttime cityscapes, which look uses actuators to vibrate the whole screen and genutterly fabulous on this set. Tiny but perfectly erate sound — but that too would add thickness and bright, white stars twinkle brilliantly against the Samsung isn’t entirely convinced of the sound qualperfectly black background of space, while the

neon of the city pulses in vivid, luminous fashion. Wildlife footage is wonderful, too, with vivaciously vibrant foliage. But if your impression now is of a sort of visual bombardment of bright whites and colors, that’s really not the case — there’s also superb subtlety to the way it reproduces the rough, gray skin of a lizard, and at no point do we feel as if we’re seeing anything other than genuine authenticity. And, for what it’s worth, the viewing angles of this prototype really do seem to be flawless. From any point in the room, the colors and blacks remain totally consistent. The only flaw from a picture performance point of view is that on the prototypes we’ve seen it has been possible to make out the borders between the Micro LED modules. You do have to look very closely, though, and there’s every chance this element will be refined before launch. Early Verdict And, let’s remember, that launch is still a long way off: We don’t expect to see this consumer model in shops until 2020 at the earliest. A huge amount of refinement and development is going to be going on between now and then. And that’s hugely exciting, because Micro LED is already proving to be an exceptionally strong prospect. The performance we’ve seen so far is, by and large, everything we love about OLED but better — brighter, more vibrant and more efficient. Of course, as likely the first commercially available consumer model, this 75-inch Micro LED TV is not going to be cheap. Samsung’s predictably keeping its cards close to its chest regarding price, but our expectation is that it will cost tens of thousands of dollars at launch. Its successors will apparently be much more affordable, though, with the company promising that prices will drop quickly as it refines the manufacturing process. That would be very exciting, because Micro LED already looks remarkably like the future of televisions. www.twice.com February 11, 2019 27


MARGIN MAKERS Skyrocket Viper Journey Pro Video Drone

Tech Toys Jump 3%

But overall toy sales aren’t as lucky

As Toy Fair New York rests on the horizon, The NPD Group revealed that U.S. retail sales of toys declined for the first time in four years, generating $21.6 billion in 2018. This is down 2 percent from $22 billion in 2017. “After the liquidation announcement of Toys“R”Us last year, there was a great deal of speculation about what would happen to the industry, with some predicting double-digit declines,” said Juli Lennett, VP and industry advisor, toys, NPD. “Overall, a 2 percent decline is a solid performance after such a significant shift in the retail landscape.” Shown here are some of the newest additions to the category, all on display at Toy Fair New York this month.

With AutoPilot firmware and built-in GPS, this drone is billed as delivering a pro-level flight experience at a $99.99 price. Using a network of satellites to triangulate its position in relation to waypoints, the Journey Pro Video Drone can maintain its coordinates in a hover without drifting away, according to the company. It also features a one-touch Return to Home mode to bring the drone back to its base.

3Doodler AlphaDoods Character Kit Billed as “Flat Stanley Meets a 21st Century Mr. Potato Head,” the AlphaDoods kits let kids create 3D-printed characters for use in stopmotion videos or social-media sharing. Each kit comes with an activity guide, two plastic packs, two canvases and a tracing sheet. Suggested retail is $19.99. 3Doodler is also debuting its first app during Toy Fair: It includes templates, video tutorials and step-by-step guides.

LeapFrog LeapBuilders ABC Smart House

iCaddy

Geared toward toddlers and preschoolers, the block set interacts with an electronic cube to respond with sounds, educational songs and phrases. Suggested retail is $39.99 for 61 blocks. They’re currently available at Amazon and will expand to other retailers later this year.

The foldable universal tablet and smartphone stand features a USB power bank with a 2,600 mAh battery, charging cable and earbuds, all of which can be stored within the device. Suggested retail is $19.99, with multiple patterns available.

Spin Master Novie

Playmates Toys Super G Wingsuit

This little robot buddy with color-changing eyes can be trained to operate via gesture controls. It can walk, do wheelies, spin and dance, according to the company. Three colors are offered: purple, red and blue. Novie will ship this fall at a $24.99 suggested retail.

These gliders feature two modes for time-controlled flights: Quick Stream for short-range flights and Advanced Glide for long-range flights. A USB cable is included for charging the internal battery. They’ll ship this spring and summer for $24.99, with the newest additions including TMNT Raphael, Spiderman and Batman.

WowWee Fingerlings Foxes & Narwhals Building off the company’s popular Fingerlings line of interactive connected toys, the new narwhals and foxes can respond to noise, motion and touch. The narwhals even have a “mood horn” that illuminates in different colors in response to interaction. They’ll be available this quarter for a $14.99 suggested retail each. 28 February 11, 2019 www.twice.com


GETTY IMAGES/AURIELAKI

Tally Up: Video Game Prediction Results The NPD Group recently released its 2018 full-year data for the U.S. Video Game industry, and once again it’s time for me to return to my predictions and see how well the ol’ crystal ball worked. I made two sets of predictions for 2018: one in late January, and another in early July. Let’s go to the report card! First, let’s review my full set of predictions from January: Growth in Spending on Subscription Services  CORRECT The uptick in spending on subscription services such as Xbox Game Pass, Nintendo Switch Online, EA Access, Origin Access and Origin Access Premiere, Humble Monthly Bundles, and the myriad other subscription services in the marketplace was significant. Subscription services are clearly a future growth driver for the industry. Switch to lead the console market in sales of both Hardware and Retail Software  CORRECT Nintendo Switch did finish as the market leader for both metrics. Annual sales of Nintendo Switch hardware were the highest for any hardware platform since the PlayStation 4 in 2015, while Nintendo Switch retail software sales were the highest for any hardware platform since 2016. Immersive gaming VR will continue to struggle

 CORRECT

Despite the release of some truly fantastic VR games in 2018, and aggressive promotion during the holiday season, immersive gaming VR continues to be a very small

niche segment of the market and failed to gain significant momentum. Unfortunately, I remain quite bearish on the market potential of immersive gaming VR. Switch gold rush leads to discovery challenges  CORRECT Over the course of 2018, Nintendo Switch grew to represent a vibrant digital marketplace with, at times, dozens of games coming to the platform on a weekly basis. While improvements to the eShop have been made, discovery on the platform remains a challenge. And although this is a problem for all digital platforms, the sheer number of games coming to Nintendo Switch makes it a particularly troublesome hurdle to overcome. At least 30 versions of Battle Royale games or modes will come to console  INCORRECT While some major players did release Battle Royale games or modes in 2018, the flood of Battle Royale that most thought was sure to happen never materialized. Games like Fortnite, PlayerUnknown’s Battlegrounds and Call of Duty: Black Ops 4 certainly took advantage of this market opportunity. At least 16.8 million units of console hardware (excluding Plug N Play) will be sold  CORRECT Bullseye. Packaged Software dollar sales will grow by double-digit percentage, highest since 2013  INCORRECT Sales were down slightly. I had forecast November and December sales higher than what occurred.

Packaged release count will exceed 330 titles  CORRECT 357 unique titles came to Console & Portable platforms in physical form in 2018, the third consecutive year of packaged release count increases. And how did I do with a selection of July predictions (those not a part of the January batch)?

Red Dead Redemption 2 will be 2018’s best-selling game  CORRECT Top 10 Seller Predictions ~ SOMEWHAT CORRECT A lot closer than I thought I’d get, to be honest. Big misses were obviously Super Smash Bros. Ultimate, Battlefield V and Fallout 76. But not terrible, I think? Nintendo Switch will be the best-selling console in Q4  CORRECT Headset and Gamepad sales will show doubledigit growth rates in Q4  CORRECT Growth rates for both accessory types were very strong in the holiday quarter. In all, two big misses, but for the most part the year played out as I’d imagined back in January. Predicting 2019 is far more challenging, so look for that on NPD.com.

CAREER MARKETPLACE

MyArcade Retro Champ The company’s first console lets gamers play their old NES and Famicom cartridges without the need for a legacy console. Features include a built-in 7-inch display, play time of up to five hours, HDMI output and built-in kickstand. The Retro Champ is compatible with the company’s Super GamePad wireless controllers. Priced at a suggested $79.99, the console will ship in June. www.twice.com February 11, 2019 29

Mat Piscatella, industry analyst, video games, The NPD Group


IN MEMORIAM

Bob Gerson, TWICE Founding Editor, Dies At 85 Robert “Bob” Gerson, a respected industry journalist, CT Hall of Famer and founding editor of TWICE, died Jan. 3. He was 85. As his Hall of Fame biography notes, he established a reputation early on for accurate and responsible journalism, and became an influential voice in consumer electronics. Gerson began his 30-plus-year tech journalism career as a freelance writer, contributing to the first Consumer Electronics Show Daily in the late 1960s and later joining the staff of Television Digest. He signed on with magazine entrepreneur Richard Ekstract and publisher Marcia Grand in 1985 to help launch TWICE. Grand remembers Gerson as an industry expert who lent credibility to the fledgling publication. “I first met Bob at a CES press event,” she recalled. “He told me he knew more about television than any person on Earth, and I found it to be so true. The whole industry looked to him for guidance.” Laying the groundwork for TWICE and facing 15 established competitors, “We needed the best writer in the field,” Grand said. “It turned out to be the right decision because within six months we were the No. 1 publication.” Gerson’s successor at TWICE, longtime editor-inchief Steve Smith, concurred with Grand’s assessments. “Bob was one of the first great experts covering the color TV business, and the related VCR, DVD, camcorder and home satellite categories, from the 1960s through the early 2000s,” he said. “TWICE’s reputation as the most trusted news source for the consumer technology industry was based on Bob’s work during the publication’s formative years. He was a great news reporter and will be missed. My condolences to his wife Barbara, his family and all his industry friends.”

Gary Shapiro, president and CEO of the Consumer Technology Association (CTA), also spoke highly of Gerson. “Bob was special,” he told TWICE in an email. “Candid and tough but graceful and honest. He defined journalism in our industry. When I became part of the industry he took me more seriously than I took myself. He knew so much more than me and was generous in sharing his wisdom and font of stories. He now joins legends like Dave Lachenbruch and Art Levis who cover tech and innovation where angels thrive.” “Bob retired before my tenure began, but by all accounts he was an extremely dedicated journalist who was fiercely committed to TWICE and to the consumer tech industry,” said Lisa Johnston, TWICE content director. “We offer our sincere condolences to his family and friends during this time.” Said John Taylor, senior VP at LG Electronics USA and chairman of the CTA Video Division board, “The industry has lost a true giant in tech journalism. As the founding editor of TWICE, he helped establish the industry bible with the most comprehensive coverage of the sea changes in consumer electronics distribution and technologies. His industry insights were second-to-none, and even when covering challenging issues, he was always, as they say, fair and balanced. Bob Gerson was a mensch.” Added longtime industry friend and fellow Hall of Famer Tom Campbell, corporate director of Video & Audio Center: “Bob had a passion and zeal for the industry like no other. He would go beyond the story, to the movers and shakers and to what made things happen. No matter how inside you might be, you always learned something reading Bob Gerson. It’s a tremendous loss to the industry. God bless you Bob, we miss you.”

Gerson was inducted into the CT Hall of Fame in 2004, its fourth year. He also received the CTA’s first Lifetime Achievement Award in 2000; the S. David Feir Humanitarian Award from the Anti-Defamation League; the RCA Color TV Pioneer Award; a Trade Publication Impact Award from GERS Retail Systems; and is an original member of the Academy of Digital TV Pioneers. In a 2004 TWICE article about fellow Hall of Fame journalists, Gerson reflected on his 19-year association with Lachenbruch, with whom he worked at Television Digest. “I learned from David what it means to have a genuine affection for an industry, how to absorb its history, how to put a meaningful perspective on new products and developments,” he wrote. “Perhaps most important of all, how to appreciate and respect the efforts of those who at all levels worked to contribute to the growth of not just their own companies but the industry as a whole.” He is survived by his wife Barbara and two grandchildren, Timothy and Laura.

Ted Henricks, Maxxsonics USA Co-Founder & VP, 60

Federated Group Founder Wilfred Schwartz, 91

Ted Henricks, Maxxsonics VP and company cofounder, died suddenly on Jan. 23 at his home in McHenry, Ill. He was just shy of 61.

Wilfred Schwartz, founder and chairman of the 67-store Federated Group consumer tech chain and a 2015 CT Hall of Fame inductee, died Jan. 17 after a long illness at the age of 91.

Alden Stiefel, president and CEO of Maxxsonics, released a statement: “Ted was an incredibly talented co-worker who added so much value to our business, it truly cannot be measured. Maxxsonics is not just a company, it’s a family. It is my family. Many of you know Ted was also one of my closest friends; we worked together for nearly 25 years.

Schwartz, along with Best Buy and Circuit City, helped create the CE superstore concept, starting with a 20,000-square-foot showroom in Orange County, Calif., following a failed first attempt in the early 1970s.

“Ted was the one of us at Maxxsonics who was most in love with the music and the passion that drives our industry. Never was his office quiet. Pink Floyd will live on at Maxxsonics forever in our memories of Ted. “He leaves behind an influential legacy at Maxxsonics along with many great memories for all of us to cherish for the rest of our lives. It is with a very heavy heart that we hear the needle… lift from the vinyl on this incredible man’s life.” Henricks was one of the 2001 founding members of Maxxsonics. The OEM audio supplier has created a tribute page at Maxxsonics.com/Ted-Henricks with arrangement details. Customers and friends with questions are encouraged to email info@maxxsonics.com.

According to his Hall of Fame bio, Schwartz leveraged Congress’s 1976 removal of fair trade pricing laws to create a discount cornucopia of consumer tech, which eventually topped 9,000 products from more than 600 manufacturers. His grab-and-go assortment also included higher-margin, limited-distribution and exclusive fare, and by the early 1980s Schwartz took Federated Group public and opened dozens of locations throughout the Southwest, Texas and Kansas, some as large as 40,000 square feet. Schwartz referred to his stores as “a year-round Consumer Electronics Show,” and promoted them with boisterous TV spots featuring radio and television personality Shadoe Stevens. He sold his business to Atari for $67.3 million in 1987, which in turn sold it to Silo two years later amid mounting operational losses. He retired in 1993, according to a notice in the Los Angeles Times.

TWICE (This Week In Consumer Electronics) (ISSN 0892-7278) is published twenty times yearly by Future, US, Inc., 11 West 42nd Street, 15th Floor, New York, NY 10036. Periodicals postage paid at New York, NY, and at additional mailing offices. POSTMASTER: Please send address changes to TWICE, PO Box 254, Lowell, MA 01853. Publications Mail Agreement No. 41975525. Annual subscription rate: USA, $159.99, Canada, $229.99, Mexico, $229.99, Foreign, $399.99. Single copies are $25 U.S. and $35 foreign. TWICE (This Week In Consumer Electronics) is a (registered) trademark of Future, US, Inc., used under license. Printed in U.S.A.

30 February 11, 2019 www.twice.com


9000

Profile for Future PLC

Twice 0663 Feb 11, 2019 (Buying Group Guide)  

Twice 0663 Feb 11, 2019 (Buying Group Guide)

Twice 0663 Feb 11, 2019 (Buying Group Guide)  

Twice 0663 Feb 11, 2019 (Buying Group Guide)