Home Appliances Why Luxury Appliances Are Essential to the Future of Independent Retail

Why Luxury Appliances Are Essential to the Future of Independent Retail

Luxury appliances include the Fisher & Paykel Series 11 48-inch Dual Fuel Range
Fisher & Paykel Series 11 48-inch Dual Fuel Range

Consumers may be flocking to big-box stores, price clubs, and ecommerce behemoths like Amazon for garden-variety consumer electronics, commodity televisions, and budget toasters, but when it comes to $15,000 refrigerators, they typically prefer to see products in store. This is an area in which the in-store experience is key, and it’s a rising focus for many independent retailers as they continue to compete against big-box stores. It’s why Nationwide Marketing Group (NMG) has now made the luxury appliances category a key pillar of its offering and strategy for growth in the independent channel. In addition to a coterie of premium appliance brand exhibitors, the most recent PrimeTime show in August also featured the buying group’s first Learning Academy dedicated to the luxury space. “We’ve never had the luxury appliance business at the center of somebody’s desk, but the majority of the luxury appliance business in the market today is all done through independents,” says Nationwide Senior Merchant Appliances John O’Halloran. “So we have an obligation to our members to try to figure out what we need to do and better support them in this category.”

While luxury brands, per se, aren’t new presences at the buying group’s bi-annual show, they came to Nashville in larger numbers and with bigger booths than ever before.  GE Monogram showed a new 48-inch range. Bosch set up its largest booth space ever, with Thermador appliances at Nationwide for the first time. Nationwide and the Appliance Dealers Cooperative (ADC) took the opportunity at the show to announce a partnership that will make ADC’s 70 brands, many of them in the luxury space, available to NMG members. And, in a departure for a company that has always been associated with innovation thanks to its double-drawer dishwashers and top-loading laundry machines, Fisher & Paykel is also evolving into a luxury brand with a full line of high-end appliances to boot. At Nationwide, for example, the 85-year-old appliance manufacturer from New Zealand had on display a 48-inch professional range, a new 24-inch convection speed oven, and new double dish drawer dishwasher, and a 24-inch wine column, as well as a DCS 48-inch grill and other outdoor kitchen appliances.

“We’ve always been known in this marketplace as a very innovative, product-driven company – we were the first company to come to market 20 years ago with a high-efficiency, no-agitator top-load washing machines,” says Fisher & Paykel President North America Kevin Dexter. “Now we’re just taking that same skill set and transferring it into a full line — columns, appliances for high-end cooking in all kinds of styles and designs for the premium kitchen.”

Why the move into luxury now? “When you look at all the indicators in remodeling and reinvestment in home, and the kitchen as a social place for gathering, we’re very optimistic about the outlook for the luxury industry,” said Dexter. “We see the long-term remodel and new build trends being positive for a very long time.”

With the proliferation of luxury brands and products, and the increased pre-purchase research that takes place online, what once may have been the exclusive purview of independent retailers is now to be found in more places, even ones that replicate the independent retailer experience. Pacific Sales today is just as much a store-within-a-store at Best Buy, which acquired the West Coast appliance retailer in 2005, as it is a dedicated appliance destination  “More national players  are getting involved in the luxury space, so we need to make sure that we are keeping our members competitive and at the same level with core products,” says O’Halloran. “We’re seeing the customer journey change, too. Consumers aren’t transacting online at a high level for $15,000 refrigerators or stoves, but that’s where they’re starting and where they’re doing a lot of research.” As such, Nationwide is adapting some of its existing analytics and omnichannel optimization platforms – Site On Time, RWS, PriMetrix – for the luxury market specifically. “We need to make sure that we’re looking at those differently than we do for core appliances because the luxury consumer is looking for a different experience. We’re working on ways to mirror the experience that a luxury consumer would have in store.”

Even so, big-box stores overwhelmingly focus on the optimization of online channels versus in-store ones. And while some appliances can be purchased online, the vast majority of them still need professional installation and servicing, and that’s just for basic core appliances. Luxury appliances are often part of a much more involved design, architecture, technology, and automation process. “It’s really tough for some big-box stores to successfully sell luxury appliances. They’re big, expensive, difficult to deliver, difficult to install, and the sales cycle is very long,” says O’Halloran. “You need an assisted sales floor with an educated sales staff that knows what it’s talking about. These are areas of strength for the independent channel. We need to make sure we continue to focus on it because it’s absolutely imperative for their success in the future.”

Similarly, Fisher & Paykel and other brands in the luxury space recognize the advantage that independent retailers have in selling premium products, which is why they are doubling down on this channel. “Because these are such considered purchases and are usually tied to a build or a remodel, folks, even if they’ve done a lot of research online, want to get out and talk to well-trained and well-educated local market experts, to confirm that the choices they’re making are right for them,” says Dexter. “They don’t want to talk to someone who just happens to be selling appliances.”

It’s equally important for appliance retailers to see luxury appliances in person, and talk to experts, which is another reason appliance makers are eager to attend live events. The recent PrimeTime was held in person, and it was the first time in 18 months that many attendees had been able to see products in person, which is important. “We’re a very known brand for some people but not for what we’re doing now,” says Dexter, “so each time we’ve come to PrimeTime in the last three years, it’s always been a journey of discovery for Nationwide members because it’s the first time they’re seeing, say, our combi steam oven or hybrid range or wine column, or all the outdoor stuff we have. It’s always exciting.”