One of the motivations underpinning the Dixons Carphone tie-up is that the new business will be better positioned to offer support to consumers facing ever more complex, inter-connected gadgetry.

One of the motivations underpinning the Dixons Carphone tie-up is that the new business will be better positioned to offer support to consumers facing ever more complex, inter-connected gadgetry.

This is, quite rightly, seen as a crucial differentiator in the battle against online pureplays.

Amazon and eBay are starting to plateau in this sector, and the extra trust garnered by the multichannel specialists from having stores and face to face contact is a major reason why. With a larger portfolio of stores offering customer-focused service, the new specialist business will hope to make further gains.

The other incentive for the two specialists pooling resources to create a more service-focused model is that service charges and add-ons are key to boosting profitability in a sector that operates on tiny margins.

The new partnership appears to consolidate upon these strengths, with Carphone gaining new products and store locations while Dixons gains access to additional services and access to lucrative contract spend.

However, reaping the benefits of this potential new market model will not be easy. There is little doubt that the future lies in connected devices but there is no such certainty that this will automatically boost demand for support services and fixed revenue plans.

Many consumers will prefer to educate themselves online or continue to learn the old fashioned way through trial and error – particularly so in a sector where there remains huge amounts of scepticism about the motives, knowledge and communication skills of staff.

This reluctance to engage also means there will always be consumers preferring the independence and flexibility of ‘pay and go’ type arrangements, shunning additional fees and follow-up services.

Indeed, promoting the connectivity of devices and offering shoppers premium support is by means a new aspiration. ‘Connected Home’ areas first appeared in PC World stores around 8 years ago and in 2010 Currys launched ‘Infinity’, an initiative allowing customers to upgrade to the latest laptop or netbook every two years for a fixed monthly cost.

Neither of these ideas gained much traction and it wasn’t until the Knowhow took many of the same values and presented them in a more coherent package that Dixon’s revival really gathered speed. Moreover, the ‘Geek Squad’ service was one positive to come out of Carphone Warehouse’s tie-up with BestBuy, but it was one of few.

Understanding and up-selling consumers to more expensive add-ons is a tough ask, even in a sector where there is perceived need for it.

Simply combining the approach of Dixons and Carphone will not be enough to persuade shoppers they need to be spending more to get the most out of their gadgets. To really live up to its potential, the new business will have to deliver a service model superior to the sum of its parts.

  • Matt Piner is research director of Conlumino