Will In-Home Services Ease Home Theatre Complexity Curve?

Like many Americans, I spent President’s Day wandering around my local electronics store, dreaming of owning an HDTV larger than my car.  The Consumer Electronics Association estimates that digital television sales for 2006 were over $20.5 billion, up more than 30 percent from 2005. With prices continuing to fall (including many decent size HDTVs now under the $1000 mark) I think the increase in 2007 sales will be even higher than 30%.

Why does the SSPA care about home theatre?  Because we’ve been banging the drum about how increased complexity is severely impacting support organizations, and though B2B enterprise tech support is the usual topic of this discussion, consumer support is getting hit with the complexity curve as well.  Those of you have have purchased an HTDV, HD DVR and surround sound system know what I’m talking about:  self-installation is a nightmare.  Mine took 2 weekends of cursing.  It wasn’t pretty. There weren’t even instructions on how to connect the equipment, just port diagrams with generic descriptions.

Connection information for Ragsdale’s HDTV
Last fall we did a survey of 1,000 consumers who had either recently purchased home office or home theatre equipment, or who planned a purchase in 2007. Of those planning to purchase home theatre equipment, only 17% said they planned to purchase in-home installation services.  26% thought in-home installation would be included in the purchase price.  58% said they’d do it themselves. I was a member of that 58%, but after my experience, I will definitely purchase in-home services next time, and I suspect a healthy portion of the other self-confident shoppers will also.

When we asked consumers why they did not purchase in-home services, the answer was clear:  nearly 60% said they thought they could do it themselves.  Cost, immediacy, or lack of a home service option were all very low on the list of barriers.  Simple self-confidence is getting in the way.

Complexity is not your friend.  Sure, consumers always like more bells and whistles.  But as products get harder to use, customers will call you more frequently for support.  And if they aren’t able to master the product, their satisfaction and loyalty suffer as a result.  So the question then is:  how can we continue to feed customers with new technology through a firehose, and allow them to consume it without drowning?

I think in-home services are an answer.  Our data indicates customers who purchased in-home installation for home theatre are more highly satisfied than customers who did the installation themselves.  And with our survey showing that consumers purchase upsell/cross-sell offers from in-home service techs almost 100% of the time, it appears in-home service can generate incremental revenue painlessly.

Perhaps we should give away in-home installation free for any home theatre purchase over $1000.  Are increased sat and loyalty, and the promise of accepted sales offers, enough to entice retailers to give away initial service visits? I hope so.  For more results from our 2006 Consumer In-Home Services Survey, SSPA members can check out 2 additional reports:
Hottest In-Home Service Options and Drivers
2007 Consumer Electronics Spending Trends

What do you think?  Will in-home services help consumers overcome the complexity deluge?  Send me your thoughts!

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