i3 - January/February 2019 - 89

By Steve Smith

R E TA I L ST R AT EG I E S

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s CES 2019 opens, the new year will feature many challenges and opportunities. That is the view of Fred
Towns, president of New Age Electronics, a division of
leading consumer technology distributor, SYNNEX.

Distributors are at the crossroads of the
consumer technology business, dealing
with retail customers and the suppliers
they represent. Towns, who has spent 14
years with New Age, and has held leadership roles with Panasonic and Kodak,
has a unique perspective on how consumers will approach challenges such as
tariffs or new technologies like 8K resolution and artificial intelligence (AI).
Consumers have luckily avoided paying
higher prices for high-tech products but
due to tariffs expected to be implemented
this year, retailers, manufacturers and
consumers will now have to adjust. "Many
of the everyday products that consumers
use for their daily jobs, tasks and schoolwork will be impacted," Towns said.
Families may buy more products meant to
be shared, like a desktop PC or notebook.
"The consumer will have to justify paying an extra 25 percent, and that's a big
change," Towns noted. "If you want the
'newest and greatest,' some consumers
will think how badly they need that
product at a higher price. They will ask
if it is time to pay a premium."
On the manufacturing side, "They will
see what new technologies they are willing
to take a risk on [and introduce]," he said.
"A 25 percent price increase is a lot and
will challenge manufacturers."
But Towns added that some, like "the
shopper looking for business travel
tech," will be willing to pay more for
higher-end products. "The typical road
warrior will pay more for something
that is smaller and lighter," he said.
However, more typical consumers may
hold off on a new technology based on
budget, waiting until it's perfected.
C TA . t e c h / i 3

Towns said that during CES, 5G will be
a highlight, as well as AI, augmented
reality (AR) and virtual reality (VR).
"Brands that have these technologies will
show and talk about it [during CES]," he
said. "And true gurus of technology will
buy those technologies because, like the
automotive industry, those who can
afford premium luxury cars have no budget restraints and will pay a premium."
Towns said that when it comes to AI,
AR and VR consumer interest will
"depend upon applications." Since many
of the devices with those technologies are
peripherals, price may be a factor, but if
you are using it with a smartphone or
gaming PC, the cost may be justified.
"Since some applications are more
business-centric, with smaller and midsized businesses shopping at top-tier retail

Business

stores or Microsoft locations for business
sales," retailers will benefit from the interest in these categories, Towns said.

CES Highlights Innovation

"What we are learning is that a few
years ago, many thought of the 'whizbang' state-of-the-industry products
only come from a supersized manufacturer," he said. "We are seeing more and
more that technologies coming from
smaller companies and much younger
entrepreneurial-spirted people have
great ideas and solutions.
"You have to open your eyes and be
broad-minded going to CES," he continued. "It is about the interconnection of
devices. LG, for example, has a message,
that 'We work with all the digital assisted
brands. We are compatible.' They have
created an environment that they are welcoming, their products will connect. It is a
brilliant marketing message."
As for emerging companies, Towns says
they are "coming up with brilliant solutions" such as a maker bot area. And what
is his advice to his staff attending CES?
"To see what is new and what are the
next ideas that will interact with our
customer base," he said. That's good
advice for anyone at CES this year.
Steve Smith was the former editor-inchief of TWICE.

JANUARY/FEBRUARY 2019

https://www.cta.tech/

i3 - January/February 2019

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