Lenbrook Renames Digital Music Centers, Retools Their Design

Lenbrook America, which embarked on an ambitious project last year to create digital music experience centers within select AV specialty stores (CED April 16/12 p1), has re-tooled the program, President Dean Miller told Consumer Electronics Daily. Lenbrook had installed five of the centers in retailers’ showrooms to educate consumers about computer audio but hit cost issues with the 400-square-foot display and discovered that one of the demos was too cumbersome, Miller said. The “crazy turntable one” was so involved that “no one could demonstrate it effectively,” he said. The turntable section has been replaced by one showing different streaming music services, he said.

Originally Lenbrook had hoped its modular construction plan would be “knock-down ready,” but it turned out to be too expensive. “We said it would cost dealers $28,000-$30,000 but they were all basically one-offs with lots of changes,” and none came in below $30,000, he said. Under the new plan, each display has three elements, including a meeting table, a kiosk and a kind of “museum pillar” for smaller devices. By limiting the elements to three modules, the price of the experience center is down to about $15,000, he said. Lenbrook is hoping to place 30-40 of the centers in stores around the country, Miller said.

In addition to streaming audio, the displays will have sections on two-channel music, multi-room audio, headphones and computer audio, Miller said. The goal is to promote Lenbrook’s NAD and PSB brands, along with the Bluesound system that the company will launch later this month, but other brands will be part of the displays, too. The centers are less about demos and more about showing customers “key fundamental applications” of how to get digital music from different sources and digital services, how to get it onto a PC and then how it’s transported and distributed around the home, Miller said.

The name has changed, too, with Lenbrook now calling the experience centers The Significant Bit. The initiative recognizes that “times change and the younger generation -- ‘digital natives’ -- don’t really buy CDs and don’t listen to an album as a destination or activity,” Miller said. Still, more music is being consumed than ever, he said, just in different ways, and Lenbrook hopes to tap into that interest. He cited the explosion in headphone sales that deliver significantly more revenue than loudspeakers today. The digital natives “don’t know what they don’t know,” having grown up with compressed music files, he said. “Most of them don’t know how good music can sound” or what a high-res file is, he said. Lenbrook wants to cultivate that market and teach the older generation “new tricks,” he said.

Barrett’s Technology Solutions, Naperville, Ill., is folding a Significant Bit section into an overall store overhaul, President Joe Barrett told us. Barrett’s, which started in 1966 selling color TVs, transitioned to AV specialty retailing and is now remodeling its 8,000-square-foot showroom to represent its most recent incarnation as a technology integration company. “I can’t say we've abandoned retail,” Barrett said, “but we've come as close as you can without doing so.” Barrett’s has established relationships with architects, designers and builders, no longer waiting for business to come through the door, he said. “We're out there promoting our brand to the different trades,” he said.

The store’s redesign will reflect “what we're doing in the field,” Barrett said. The store has partnered with a landscape architect on a paver display showing outdoor electronics in a patio setting. “Walk into our store and you'll get an outdoor experience like no other,” he said, citing the growth in spending around outdoor living products for the home. Barrett’s will show outdoor TV and music solutions to ride the trend.

Barrett’s has also joined forces with a prominent high-end kitchen designer to create “the most automated kitchen in the industry,” Barrett said, complete with a powered spice rack that rolls out at the touch of a button on a Savant-driven iPad. The company also worked with an Amish furniture company in central Indiana on a sports bar, part of a “man cave” setting built around a Sharp 90-inch TV that can be watched in split-screen mode, also controlled by Savant.

Barrett’s hasn’t completely abandoned its retail roots. The store will be open six days a week until 7 p.m., although “you won’t find a price tag on the floor,” Barrett said. Barrett’s will still have the requisite home theater system, but the wall of TVs has been replaced by three media rooms. “We're not in the unit or big box business anymore,” Barrett said. “I'll never be able to out-unit the unit guys, and they can’t compete with my level of installation expertise and service and after-sale support,” he said.

Lenbrook’s Significant Bit is Barrett’s “commitment to the next generation” of clients, he said. Audio is one of two products important to that segment, with the other being home automation, he said. Barrett’s biggest investment in the segment is in audio because of its ability to present the performance audio experience effectively. “You can’t listen to a pair of $1,000 speakers over the Internet,” he said. The various stations of the Lenbrook Significant Bit display will show streaming, music services, connectivity, accessories and “how to bring the streaming experience to the performance audio level,” he said. Barrett’s will add a networking section to the mix.

Barrett’s tried to be a hybrid retail and custom store, but that’s no longer the strategy it wants to pursue. Instead, Barrett is creating an “experience center” where his own staff and those from his architectural partners can meet with clients. Once those clients enter Barrett’s showroom, they can also be exposed to step-up audio and video. The new strategy is apparently working. With labor now attached to 90 percent of sales, margins have increased from the low 30s to more than 40 points for the past three months, Barrett said.