BestBuy recently announced they would launch a connected TV under the Insignia brand using the Tivo user interface. This is a great example of the Innovator’s Dilemma in action.
The Insignia brand is one of Best Buy’s house brands. It (like other private label brands) is frequently used as the opening price point for devices. House brands tend to do this best for maturing categories – where consumers have become comfortable with how they use their devices and are largely looking for replacement devices. It also works for late adopters who are looking for their first purchase in a given category (and might be more price sensitive). In both cases, these consumer segments are looking for low-priced options.
The Insignia brand has grown to represent some 10 percent of the television market. Moving into the Connected TV space is an interesting move for the Insignia brand. It is certaintly a growing segment of the declining TV market. In the first half of 2010 they represented about 8 percent of total shipments. Just a year later the share of connected TVs had grown to about 20 percent of total TV shipments. While they’re grown significantly in terms of shipment share, they still represent a relatively low share of the installed base.
The move will allow the Insignia models to enter a growing segment of the TV market.
