Yesterday’s announcement that HD Radios will be featured prominently in Sharper Image stores and catalogs needs to be placed in a broader context.
And that broader context begins with the failing health of Sharper Image itself:
For the fiscal year ended January 31, 2007, total Company sales were $507.0 million compared to $650.3 million in the previous year, a decrease of 22 percent. Total store sales for the year were $311.2 million compared to $407.1 million in the prior year, a decrease of 24 percent. Comparable store sales for the year decreased 25 percent. Total catalog sales/direct marketing sales (including wholesale) for the year were $110.6 million compared to $135.9 million, a decrease of 19 percent. Internet sales for the year were $85.2 million compared to $107.2 million, a decrease of 21 percent.
And it continues with the role that free radio advertising plays in Sharper Image’s decision. “Supporting The Sharper Image will be part of the next phase of the Alliance’s $250 million dollar 2007 advertising campaign announced in December,” says the HD Alliance.
Now, to be fair, there’s nothing wrong with trading advertising for exposure. This kind of stuff goes on all the time.
What’s wrong, however, is to pretend that it’s any deeper than this. One can’t crow about HD Radio’s “incredible momentum” when iBiquity itself acknowledges sales are in the “low hundreds of thousands” and Sharper Image’s decision-making is motivated primarily by financial malaise and advertising opportunism, not by a sense that these items will fly off the shelf and profit the mother-ship directly.
From Sharper Image’s perspective, HD radio is barter.
Why hasn’t HD radio reached more retailers, more broadly, and faster? Perhaps because these big box stores value the floor space more than the free advertising. Perhaps because they know that promoting hot-sellers at favorable prices is what brings in the throngs. It’s not simply about their store name on the radio, or anywhere else for that matter.
Consider what Sharper Image spent their money on in past advertising. Was it a fast-seller or a slow one?
Can you say “ionic breeze”?
Now you could say “but this will create more distribution for HD radios, more visibility, and that will spike demand.”
But you’d be wrong. The problem has never been distribution. It has been the essential perceived need for the bundle of benefits that HD radio provides the consumer. The problem has been demand.
And while strong demand always creates wide distribution, wide distribution does not necessarily create strong demand.
This issue is bothering me more and more lately. Because not knowing the truth is one thing. Ignoring it is quite another. And not integrating it into a coherent product and marketing strategy is a tragedy.
You may be right about most of this, but think again before disparaging the Ionic Breeze! As recently as 2004, the Ionic Breeze was responsible for 40-50% of Sharper Image’s revenue (according to BusinessWeek: http://www.businessweek.com/magazine/content/04_38/b3900061_mz011.htm, which I actually recalled reading–and being surprised about– when it came out) Here’s an analogy-despite the fact that no one needs or asked for an Ionic Breeze (and subsquent Consumer Reports testing showed that they didn’t even purify the air) they still sold a massive amount of them, actually.
So, I don’t know that this refutes your arguments, Mark– but the Ionic Breeze is more example than warning. You can’t polish a turd, but Sharper Image sure made it smell good (and minty fresh) for about six years. The Alliance should hope that HD is the next Ionic Breeze!
I never thought I’d see the day when you’d let your dislike for HD Radio color your view about basic marketing. This isn’t personal, it’s business.
I’m no huge supporter of HD Radio, but I’d like to see it at least get a fair chance. Right now, retailers, auto companies, and electronics manufacturers are being paid off by XM and Sirius in an effort to get their product in front of consumers. So now HD Radio is doing the same thing. In the end, it’s not the marketing that will win the battle, as we’ve already seen with satellite.
My suggestion is just let the battle be fought. See who wins. You don’t have to say a word.
You misread me. I was complimenting the ionic breeze. Their selling effort reflected that it could sell. That was exactly my point.
I’m not criticizing marketing, George, just bad marketing. The battle has already been fought and lost. Because the battle plan was wrong from the begining and no one seems to understand a new strategy is needed.
No new strategy, no new results.
From an “image by association” perspective- I was discouraged to hear about the Sharper Image deal.
Sharper Image’s “image” used to be about cutting edge, hip and fashionable products. Things that started a conversation.
The problem is – the “imaging” wasn’t backed-up in reality.
Things that looked great in a catalog or behind a display case felt cheap and chessy when held and used in real life.
Unfortunately SI seems to have devolved into an image over substance novelty store.
Even more unfortunate is how “at home” the cheesy looking HD Radio sets look on the Sharper Image website next to the “Love Handler” workout machine & the “Pyramat Wireless Sound Rocker”.
But to George’s point – maybe beggars can’t be choosers.
Can someone here explain what the difference is between HD sound and digital sound, for example stuff like iTunes or 128 bit MP3 files?
“No new strategy, no new results.”
You’re giving up too soon.
The problem is a lack of understanding on the part of the public, and no way for them to sample the advantages. I don’t think Sharper Image will help. They need to get this into WalMart and McDonalds. But you make your deals where you can.
There’s too much negativity in this discussion. It’s being combined with general negativity about radio. How about some real ideas, not just defeatism.
Interesting to note, that Radio Shack, Circuit City, and Sharper Image all are having financial problems – trading free advertising, for HD radio space… hmmmm. Hasn’t the HD Radio Alliance learned, that the ad campaign for 2006, with associations with Amazon and Radio Shack, was almost a total failure – looks like, this year’s association, with Sharper Image, will bring the same results. I keep hearing, more-and-more ads on radio for HD Radio, and it probably is just getting to the point, of annoying consumers – I certainly, am getting sick of hearing about it. Almost, a humorous road to failure !
It was almost humorous to read about the Sharper Image partnership.
For many years (until I stopped paying attention to Sharper Image) I had this opinion that SI is over-priced garbage. I’d walk by their stores in the mall and not even walk in. Just see the logo and think “wish I could afford to blow too much money on useless products.”
So, the irony that exists with them now selling HD Radios “prominently” is funny to me.
I, like most of you, would like to see HD succeed. But I’m not sure SI is the/an answer.
Listeners don’t want HD. Not merely backward-incompatible, its backward destructive. HD ruins reception and renders existing radios worthless. HD is software driven. Expect crashes, upgrades, and fees.
HD jams up to five channels at a time. Simply put, AM HD 800 jams 770 to 830. Worse, HD range is very short, so say disappointed listeners, but HD noise travels far. If your favorite 770 is jammed by HD 800, HD-dogs in the manger say, ‘you hurt local stations by listening to ones out of town’. Isn’t that like saying you can’t shop at the mall because the corner store loses business? Worse, HD stations aren’t ‘local’. Clear Channel, Cumulus, ABC, and other ‘Big Boys’ are voice-tracked radio-bots whose programs originate hundreds of miles away. ‘Live and local’ Radio? Jammed off the air by HD noise – that’s the real goal. Worse, billions of radios are rendered worthless by this noise belching turkey. Worse yet, HD claims ‘CD quality on FM, but many call its ‘seedy quality’. AM? Forget it.
Broadcasters dislike ‘HD Cotillion’s’ coercive tactics and will remain analog. There’s talk of litigation due to HD’s jamming. They say until iBiquity and Clear Channel ‘partnered’ with a feckless, bought, FCC, a broadcaster who caused HD’s raucous destructive interference would not only be fined, he’d lose his license and equipment.
HD is about monopolykasters taking over radio. Clear Channel, Cumulus, ABC and similar types hope jamming will destroy competition and grind listeners into submission.
Do they think us all to be as greedy and moronic as are they? What if we simply tune out? No audience? They’re finished.
HD is a poorly conceived 80′s concept, shoddily executed by the usual BigKorpseorate suspects. It’s long obsolete, many times superseded by superior innovations such as iPods, WiFi, WiMax, and new analog radios which deliver excellent audio.
Hopefully, consumer apathy and ill-will are result of the jamming will stop this attempt to circumvent the marketplace. Radio is too important to be squandered on Clear Channel and a few other monopolists.
Dr. Paul Vincent Zecchino
Manasota Key, Florida
09 February, 2007
From George:
“You’re giving up too soon.”
George, the lack of marketing fundamentals are so glaring to me here and the window for success is so small. You obviously don’t realize that the vast majority of new technology products fail. And that’s another way of saying ‘an introduction is all most new tech products get.’
Says George: “The problem is a lack of understanding on the part of the public, and no way for them to sample the advantages.”
Absolutely, positively wrong. The problem is foundational – it’s not about ‘putting it out there in the marketplace.’ It’s about fundamental need.
Concludes Geroge: “There’s too much negativity in this discussion. It’s being combined with general negativity about radio. How about some real ideas, not just defeatism.”
I find this deeply offensive. And it is characteristic of folks who don’t like a discussion to position the discussers as ‘haters,’ whether those discussions are about bad decisions in the marketplace or ion the battlefield.
I have, for more than a year, pointed out the challenges that HD radio will have to grapple with, I have posed questions the industry needs to effectively answer, I have offered strategies to make the effort work.
All are widely – VERY widely – read by the HD radio establishment and completely and arrogantly ignored.
Meanwhile, the broadcasting industry is very rapidly coming around to my way of thinking, from the bottom up.
If it’s “real ideas” you want, I have spent a lot of effort to offer them – for free.
For this, I have been cautioned and criticized. I have been warned by at least one client. I have bben told outright by the HD Alliance that my efforts are “a funny way to get their business.”
And frankly, I don’t give a damn.
The HD establishment made a foolish set of decisions and took a foolish set of wrong forks in the road. So now when I tell them they have to go back and take different forks they turn a blind eye.
While I respect the need for everyone in whatever line of work to make a living, I believe in being effective. Not in simply doing what you’re told. Not in simply spinning the truth in the hopes that the future breaks your way.
Telling the truth and trying to get the chiefs to listen: That is what I call pro-radio.
Ignoring the truth and pretending it doesn’t exist: That’s what I call anti-radio.
Fortunately for me, many broadcasters know the difference. And that is why my business is better today than it ever has been. It’s why newspapers and cable outlets and financial analysts and group heads all come to me for a perspective on the future.
To them, and all my clients, I am very grateful.
A deeper look at the HD Radio & Sharper Image deal
So this is funny. While it was recently announced that HD Radio inked a deal with Sharper Image, there looks to be a bit more motivating the partnership than meets the eye.Sure, HD Radio gets another retail outlet (with prominent placement in stores an…
I am just a consumer remodeling my kitchen and I want a really good radio because I listen to talk radio all day long. My station of choice, KFIam640 advertises that it is an HD station. I think maybe KABC am 790 is too. So I thought I would buy an HD radio to get better reception. But if they are already broadcasting in HD, does that mean that they will sound worse on an HD radio? How does one station blast out the other one? Are you saying if I have one HD radio in my house, that will render the other ones worthless?