SVI Magazine

Maybe that’s a bit strong, but it is certainly a male dominated industry, with estimates putting the male/female split of purchasers at something like 95% to 5%. When you then consider that it’s only something like 5% of the UK population who buy ‘real’ Hi-Fi, that figure equates to around 1.2-million males. Given that the UK Hi-Fi industry is worth something in the region of £200-million per year*, then each purchaser spends an average of £165 annually. Not a lot, is it?

It is essential that we explore the opportunities with consumer groups not usually associated with our industry if we are to grow and prosper in the face of declining sales in our traditional markets. There won’t be many answers in this piece as each one would take its own article and far more space than permitted for this column, but hopefully there’ll be enough questions raised to give you food for thought. Maybe we’ll explore some specifics in future articles.

First of all some facts:
50.5% of the UK population is female.
Almost 50% of the millionaires in the UK are female.
Women’s spending power is increasing faster than men’s.

Technology products have traditionally been designed by men for men, but the demographics of the typical tech-savvy consumer are changing. According to Ofcom, the use of the Internet by 25-35 year old females is 20% higher than that of males in the same age bracket.

It is for these reasons that we are seeing an increasing number of high-profile brands adapting their product and marketing approach to cater for the female consumer. Apple, Intel, Nokia and Samsung are just a few of the technology producers who have acknowledged the importance of the female market in their product design and communications activities.

There’s potentially a huge and largely untapped market for the Hi-Fi industry to court here, but what we need to learn to do, is to focus on the benefits rather than features, and find a way of communicating in plain English without the techno-babble that males pretend to understand. A rough poll of my female friends shows they are just as interested in music as men, appreciate good sound quality just as much and would like to have the best experience they can afford with their home entertainment. What they didn’t want was to be bamboozled with technology – they want a product that’s simple to use, looks good and works well.

Getting the product and marketing paraphernalia to conform to those requirements is down to the manufacturers; selling it to them is up to the retailers. So, we need to take a step back from our tried and tested techniques that work well with our traditional male market and look at ways of appealing to the woman who wants a good quality home entertainment system. Perhaps we should be looking at our shop windows, in-store presentation, staff appearance, advertising materials and verbal approach?

market research
The female market isn’t the only lucrative opportunity for our industry. There are many other groups that spring to mind for further exploration. Here are just two:

Grey and Legacy.

Firstly, 19-million members of the population are over 50-years old (that’s 40% of all adults) and this demographic is the holder of 80% of the disposable wealth in the UK. According to SAGA, that disposable income pot is worth a staggering £175-billion, which is 30% more than the under 50s hold.

The so-called ‘grey’ market are the first generation to have been continually advertised to throughout their lives and are therefore ‘advertising aware’ – i.e. not easily swayed by advertising. Indeed, Age Concern says that three quarters of ‘grey’ market consumers don’t relate to advertising at all. One thing that is known is that older purchasers take more time researching their purchases, so approaching them with clearly stated product benefits and facts will aid the decision making process.

So, we need to find ways of convincing them that our offering is worth taking a look at. What stands in our favour is their generational appreciation of quality – “they don’t make ‘em like they used to!” They are pre-MP3 and the throw-away society, and quality has a value to them. An emphasis on quality is crucial here, together with an appreciation of the available wealth of this consumer group. Where are the wealthy older people in your catchment area and what are you doing to target them?

a fresh approach
Secondly, existing customers are possibly one of the most important assets any business has. It’s a cliche, but it costs far more to gain a new customer than retain an existing one. Up-selling is one of our industry’s real strengths.

We all strive to prove the worth of the next product up in the range, so why not use this skill in conjunction with your customer database to bring back existing and maybe rarely seen customers and show them what their next purchase should be? This group of consumers is the best known – their location, demographic, purchase history, likes/dislikes are all easily recalled from a CRM (customer relationship management) system (which can be as simple as a spreadsheet or as comprehensive as a dedicated computer programme).

Theoretically, they are the most predisposed group of customers you have; if they were happy with the service they received last time they shopped with you, then getting them back through the door shouldn’t be too arduous a task. Just remember to make things fresh, offer different and better products and don’t over communicate with them – they won’t want to upgrade every three months!

In times of economic strife (whether the media are hyping it up and making it worse is open to debate, but not here – I have my views on that and I’m sure you do also), it’s important to start looking beyond our traditional market and to seek out new opportunities for revenue generation.

*GfK

Phil Hansen is Operations and Marketing Manager for BADA, the British Audio-Visual Dealers Association and also runs Red Sheep, a successful Marketing and PR Consultancy operating within and outside the Hi-Fi industry.

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