‘We don’t do enough with independents’
Speaker and headphone brand Harman, which was acquired by Samsung last year, is looking to grow its business in the UK and deal with more independent retailers. Sean Hannam met Reece Cummings, head of sales for its Consumer Lifestyle Division, to find out more…
When Harman International, a global player in lifestyle audio products, connected car technology and professional AV systems, was bought by Korean electronics giant Samsung in 2017, no one saw it coming.
“It was a strange one – no one from my level down knew anything about it beforehand, so it came as a bit of a surprise,” says Reece Cummings, head of UK sales for Harman’s Consumer Lifestyle Division, which includes the audio brands JBL, AKG and Harman Kardon.
He is speaking to ERT at the company’s brand new offices in Apsley, on the Westside business park, near Hemel Hempstead, in Hertfordshire.
Inside the shiny, glass-fronted building, there’s an impressive showroom that includes Harman’s consumer audio products and professional solutions under one roof.
Elaborating on the Samsung acquisition, he says: “If there were any initial concerns, they were dealt with very quickly. The way that we’ve maintained our business and management structures has allowed us to retain our position as a Harman entity and our focus hasn’t changed – if anything we’ve gained an incredibly strong ally.
“From a Consumer Lifestyle point of view, the biggest benefit we’ve seen has been for the AKG brand, which it [Samsung] has adopted as a front runner – AKG is in a main position as an authority on audio, which can only benefit us.
“We’ve had a good working relationship with the Samsung team in the UK – there’s been a very open dialogue.”
Q: Can you talk us through Harman’s strategy in the UK for its Consumer Lifestyle Division and its brands?
Reece Cummings: I joined two years ago with the remit of building the team back up to where it should be.
We’d been a little bit quiet in the UK market, but we’d seen some really strong, positive growth across the rest of Europe, especially the bigger territories, like France, Germany and the Netherlands.
We wanted to adopt that strategy for the UK and make sure that we used JBL as the lead brand – it’s garnered most of our attention and focus, mainly because of the breadth of the range. We can cover so many touch points, from headphones to portable audio and home audio. It doesn’t mean that we forget or neglect Harman Kardon or AKG, it just means that JBL becomes our lead brand that we can get behind.
We have a large suite of brands across the different areas of the Harman business – Professional, Luxury and my area, Consumer Lifestyle, which is where we focus on JBL, Harman Kardon and AKG.
We differentiate between the brands according to demographics – for JBL, the SKU is a little bit younger, but for AKG’s headphones we have different customers, because we’re talking about high-performance products and reference headphones, which have higher price points.
With the growth of Harman Kardon’s portfolio, it allows us to reconsider which markets it should be in and which customers and retail partners we should be talking to.
Q: What’s your route to market?
RC: We have a fairly broad portfolio of customers and retail partners, but we don’t do enough with independents.
With the shrinking of our UK team, we didn’t really have the resources to have a meaningful conversation with the independent market, but now we’ve got ourselves back into a position of being fully staffed in sales and marketing – and with the backing of the wider corporate [Samsung] business – it allows us to start that dialogue.
In the UK, we now have a team of five people in sales and three in marketing and PR.
We’ve got some new products coming to market – the Harman Kardon Allure voice-activated speaker [with Amazon Alexa] and the JBL Link speakers with Google Assistant, plus a new range of JBL soundbars.
With the Link series, the main push for us will be the Link 10 and 20, which are both completely portable. They can be used at home, in the garden, or when you’re out and about. It’s a far more flexible approach to the connected home and voice activation.
The voice space and how it plays out in the home has become more important. Trying to make headway in the voice space is challenging – it’s very crowded, but we know that we have unique, good-quality products.
Q: You’re not tying yourselves into one voice-activated operating system, either, are you?
RC: That’s always been the Harman way – we want to work with as many partners as possible. The market will show which of those is more successful than others.
Voice is a very young market – there’s still lots to be developed within that area and finding the real customers and use cases for it.
Q: Do you think some independents are reticent to embrace voice products?
RC: I think it depends on whether you view voice as being an IT product or a home-audio product. Our position is that it’s very much a home-audio product – we’ve got a range that shows why they should be treating it as such. That whole connected home space is becoming more important and will continue to do so.
When you’re looking at our soundbars, there’s the ability to demonstrate and talk about the heritage of the brand and why you would choose it over another – those opportunities in retail are becoming few and far between. With demonstration spaces and the knowledge of some of the staff, independents have a big plus point.
Q: What are your hopes for the UK business?
RC: If we invest in the brands, we’ve got high hopes for strong growth. For me, it’s about sustainable growth, which is where the independents come into their own. It’s about making sure that the partnerships are that little more meaningful – that we support them properly. It’s about driving awareness and brand recognition – we’re spending a lot on ‘out of home’ and digital advertising and we’re sponsoring festivals. We have a lot of activations to drive brand awareness and to make sure our core audiences understand who we are and what we’re about.
We’ve got very strong heritage on our core brands – JBL recently had its 70th anniversary and people have a lot of faith in it in terms of quality and performance.
We can help retailers to promote the brand in-store and we have the staff to support them with information and training.
Q: Are you looking to push specific brands through independents?
RC: No – it comes down to the retailers themselves. I don’t believe we can treat independents as a simple ‘one size fits all’. The independent market has become very specialised, whether that’s through installations or service.
For me, it’s about working with independent retailers to try to find what works for them. There’s no point in me pushing a preordained idea of what I believe will work – it’s about having a conversation.
We already work with a few independents through the distributor Karma AV.
Q: What’s your take on the audio market?
RC: It’s not without its challenges and there’s an awful lot of uncertainty at the moment. There’s an unsettled playing field, but within that there’s a lot of rapid change, which is difficult for some retailers to adapt to.
We’ve seen some really solid growth over the past couple of years. Whether that’s down to the additional brand marketing we’ve put out there, or the strong portfolio we have… It’s more than likely a combination of both.
The audio category never really went away – we’re at a point where we’re re-educating the [retail] market on why it should be up-selling [consumers] to certain headphones and speakers. It’s a generational shift – how people access music and content has changed drastically. Headphones are a massive growth area for us – over-ear has become more popular for us than it was before. That’s helped by the fact that we’ve got noise-cancelling products at a reasonable price – we’re listening to what customers say they need from a headphone in terms of portability, features and design.
I think over-ear headphones are very much driven by the fact that you can download Netflix to your phone or your iPad. Having that personal space on the Tube, the bus or the train, has helped to make that shift.
Q: So, finally, if we talked again in a year’s time, what would you like to have achieved with Harman?
RC: A broadening of our distribution – we have a massive portfolio of products, but we’re not fully capitalising on the full range. There are some clear winners, like the JBL Flip [portable speaker]. We’ve sold over 12 million of them, so we know we’ve got very strong products, but there’s far more depth to our portfolio.
Having some added emphasis and training and knowledgeability in-store could really help retailers and us.