Luxury Segment Should Stay Strong Through 2022, HTSA Event Told

After two years of buying “everything they need” from Amazon, Home Depot and Walmart, “I would suggest the consumer is gooded out,” Henry Smith, Haverford Trust director-investment strategy, told attendees. Overall, Smith expects a spending shift from goods to services and experiences.

Overall, consumer confidence surveys have been trending down over the past few months, most likely due to rising gasoline prices, Smith said, but retail sales continue to surge. “The consumer is saying one thing in a survey but doing just the opposite with their wallet,” he said, citing pent-up demand. He noted it took multiple years for the economy to recover from the 2008-2009 financial crisis, “and here we’ve done it very, very quickly. This was just a very, very unique recession.”

HTSA’s clientele is likely an outlier to general consumer trends, Smith said. Household net worth is at the highest level it’s ever been in terms of home values and stock holdings. “Incomes are at record levels, and people want to spend,” he said. Surveys of luxury brands are trending positive, he said, highlighting LVMH Moet Hennessy Louis Vuitton. “At least through 2022” the luxury segment should “remain strong” and is much better able to weather inflation than “the lower half of the spending spectrum that’s impacted to a great degree by food and fuel inflation.”

Smith downplayed the impact of cryptocurrencies, in response to an integrator's question on whether they're a systemic threat to the economy if speculation drops on their value. Crypto “isn’t broadly owned” and is still a “niche investment,” he said. He compared cryptocurrencies to commodities: “There is no underlying value other than what buyers and sellers at any given moment believe there to be.” When an investor buys timber, gold or oil or crypto, he said, “if you’re going to make money, you’re dependent upon the next buyer coming along to buy it at a higher price.”

Thirteen-year-old Mike Wimmer, who made headlines in 2021 after graduating from high school and junior college in the same year, is founder of Next Era Innovations, with a charter to use technology to help people live better lives. Also answering the question on cryptocurrencies, Wimmer called digital currency “a very interesting idea” and said, “Since we’re off the gold standard, does paper money have any value anymore?” Wimmer believes crypto will grow substantially over the next few years as more people invest in it and businesses begin to use it more for payment.

“Inferences from data” will become the center of the smart home of the future, Wimmer said, saying HTSA’s do-it-for-me customers will be the first ones wanting this type of automated technology. To prepare for the future smart home, integrators need to become “ambassadors of AI,” Wimmer said. They need to understand what the capabilities of AI are and “more importantly, what they are not.”

That includes dispelling fears about data collection and robots, Wimmer said. “We are nowhere close to having a Terminator-type robot taking over the world,” he said. Robots aren’t going to take away jobs but will “augment the mundane and repetitive jobs.” Having tasks and chores done by robots will create more time for families to spend time together, he said.

An integrator asked about AI’s role in future energy management, saying she received a text that morning from a customer asking for help in response to a $2,800 utility bill. Wimmer said making homes self-sustaining is one answer to high energy costs. Though utilities are moving slowly to sustainable energy, he said, “it’s going to take a long time” to move away from coal to more sustainable wind or solar-powered energy.

On one of the custom integration channel’s main pain points over the past few years -- finding qualified labor -- Wimmer suggested integrators target students in science, technology, engineering, the arts and math programs early to let them know the industry exists and what it offers. They should contact heads of STEAM departments at high schools and colleges to create a dialogue, he said.

Wimmer suggested integrators attend a local high school’s career day, sponsor a science fair, judge tech competitions and present to tech-based summer camps where kids participate in hackathons and design robots. Integrators could sponsor a battle bot team and see their company name on TV, he said. “Go further,” he added, “and even incorporate interactive lighting onto a bot that’s influenced by tweets during the bout.”