Small Kitchen Appliances - UK - November 2017

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
Market contracts in 2017
Figure 1: Consumer spending on small kitchen appliances, 2012-22
Rising inflation on household appliances
Figure 2: Monthly CPIH, % growth on previous year, August 2016-August 2017
4.2 million kitchen refits in the last three years
Argos leads a fragmented market
Figure 3: Estimated distribution of small kitchen appliances, by value, by retailer, 2017
Companies and brands
Smart technology helps make personalised diets easier to stick to
Sharp to launch first range of small kitchen appliances
19% growth in advertising spend in 2016
Figure 4: Total above-the-line, online display and direct mail advertising expenditure on small kitchen appliances, 2013-16
Bosch stands out in brand research
The consumer
99% own a small kitchen appliance
Figure 5: Ownership of small kitchen appliances, August 2017
More men than women buy appliances
Figure 6: Small kitchen appliances purchased in the past year either for themselves or as a gift, August 2017
Price and functionality drive decision-making
Figure 7: Important factors in choosing what to buy, August 2017
In-store remains the most popular way to shop
Figure 8: How they bought the small kitchen appliance they spent the most on in the past year, August 2017
Argos the retailer of choice for 21%
Figure 9: Where they shop for small kitchen appliances, August 2017
Argos chosen for price and availability
Figure 10: Reasons for selecting the retailer they used to buy the SKA they spent the most on in the past year, August 2017
Lack of space inhibits new purchasing
Figure 11: How they use small kitchen appliances, August 2017
Two thirds interested in appliances that are easier to store
Figure 12: Attitudes towards small kitchen appliances, August 2017
What we think
ISSUES AND INSIGHTS
Overcoming ‘peak stuff’ in the kitchen
The facts
The implications
Appealing to the new man in the kitchen
The facts
The implications
Smart appliances help create personalised healthy eating lifestyles
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Market declines 0.5%
Slow growth forecast
Decline in key segments
Inflation dampens demand
Declining marriage rate and rising cohabitation impact the gift list market
Argos leads and online growing fast
MARKET SIZE AND FORECAST
Inflation fails to offset a decline in volumes
Slow growth forecast
Figure 13: Consumer spending on small kitchen appliances, 2012-22
Figure 14: Consumer spending on small kitchen appliances, 2012-22
Forecast methodology
MARKET SEGMENTATION
Great British Bake Off no longer driving sales
Booming capsule coffee machine sales come to an end
Personalised recipe plans could be an avenue for growth for food prep
Figure 15: Estimated consumer spend on small kitchen appliances, by segment, 2013-17
MARKET DRIVERS
Incomes are being squeezed
Figure 16: Real wage growth: wages growth vs inflation, February 2014-August 2017
Inflation hits small kitchen appliances
Figure 17: Monthly CPIH, % growth on previous year, August 2016-August 2017
Life skills in cooking
Figure 18: Confidence in life skills, by gender, November 2016
Consumers prefer spending on experiences
Figure 19: What they choose to spend extra money on, September 2017
Number of marriages in long-term decline…
Figure 20: Total number of marriages and marriages per 1,000, 2000-14
…and more couples already live together prior to marriage
Figure 21: Type of wedding present given, October 2016
Student numbers stabilise following decline
Figure 22: Total number of students, 2000/01-2015/16
The coffee connoisseur movement
A quarter are interested in owning a coffee pod machine
4.2 million kitchen refits in the last three years
CHANNELS OF DISTRIBUTION
Argos leads a fragmented market
Online growing fast
Growth in direct-to-consumer model
Figure 23: Estimated channels of distribution, 2017
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Shrinking products to fit shrinking homes
Smart devices lead new product development
19% growth in advertising spend in 2016
Bosch leads on trust and differentiation
COMPETITIVE STRATEGIES
Kenwood updates its range
Electrolux acquires Anova
Downsizing to squeeze into smaller spaces
Smart technology innovation continues to increase
LAUNCH ACTIVITY AND INNOVATION
NutriBullet launches VegeBullet and Balance
Figure 24: NutriBullet Balance
Nespresso releases its smallest machine to date
Smeg launches Dolce & Gabbana Kitchen Appliances
Figure 25: Smeg and Dolce & Gabbana range of small kitchen appliances, April 2017
Smeg unveils new range of small kitchen appliances
Griffin Technology unveils a collection of AppPowered appliances
Gourmia introduces Award-Winning Smart Kitchen Tea and Coffee Maker
KitchenAid releases new Precision Kettles
BuzzFeed enters the smart appliance business
Sharp launches first range of small kitchen appliances
ADVERTISING AND MARKETING ACTIVITY
19% growth in advertising spend in 2016
Figure 26: Total above-the-line, online display and direct mail advertising expenditure on small kitchen appliances, 2013-16
Over half of advertising spend takes place in Q4
Figure 27: Quarterly recorded above-the-line, online display and direct mail total advertising expenditure on small kitchen appliances, 2016
Coffee pod machine manufacturers step up advertising efforts
Figure 28: Top 10 spenders on above-the-line, online display and direct mail advertising expenditure on small kitchen appliances, 2013-16
Nespresso leads spending
Figure 29: Recorded above-the-line, online display and direct mail total advertising expenditure on small kitchen appliances, by brand, 2016
TV grows in importance as press advertising declines
Figure 30: Recorded above-the-line, online display and direct mail total advertising expenditure on small kitchen appliances, by media type, 2013-16
Leading advertisers rely on TV
Figure 31: Recorded above-the-line, online display and direct mail total advertising expenditure on small kitchen appliances, by advertiser and media type, 2016
Campaign highlights
Nespresso continues with ads starring Clooney
Will.i.am features in Nescafé Dolce Gusto ad
SodaStream’s Game of Thrones parody stirs controversy
Nielsen Ad Intel coverage
BRAND RESEARCH
What you need to know
Brand map
Figure 32: Attitudes towards and usage of selected brands, October 2017
Key brand metrics
Figure 33: Key metrics for selected brands, October 2017
Brand attitudes: Bosch a brand worth paying more for
Figure 34: Attitudes, by brand, October 2017
Brand personality: Tefal associated with fun
Figure 35: Brand personality – macro image, October 2017
Breville the basic and affordable option
Figure 36: Brand personality – micro image, October 2017
Brand analysis
Bosch is a favourite brand of the well off
Figure 37: User profile of Bosch, October 2017
Tefal a trusted brand that is fun and reliable
Figure 38: User profile of Tefal, October 2017
Russell Hobbs is trusted for value
Figure 39: User profile of Russell Hobbs, October 2017
Breville a brand that struggles to stand out
Figure 40: User profile of Breville, October 2017
De’Longhi an expensive brand that needs to better articulate its quality
Figure 41: User profile of De’Longhi, October 2017
THE CONSUMER – WHAT YOU NEED TO KNOW
99% of UK consumers own a small kitchen appliance
More men than women buy appliances
Important factors differ by gender
In-store remains the most popular way to shop
Argos the retailer of choice for 21%
Argos chosen for price and availability
Trust important when shopping for coffee machines
Lack of space inhibits new purchasing
Two thirds interested in appliances that are easier to store
OWNERSHIP OF SMALL KITCHEN APPLIANCES
Small kitchen appliance ownership almost universal
Kettles versus boiling-water taps
Figure 42: Ownership of small kitchen appliances, August 2017
Coffee machines still the reserve of the affluent
Figure 43: Profile of small kitchen appliance owners, August 2017
Men less likely to own food processors or mixers
Figure 44: Ownership of small kitchen appliances, by gender, August 2017
Six small kitchen appliances per person
Figure 45: Repertoire analysis of small kitchen appliance ownership, August 2017
PURCHASES OF SMALL KITCHEN APPLIANCES
Kettles bought by a third in the past year
Figure 46: Small kitchen appliances purchased in the past year either for themselves or as a gift, August 2017
The new man in the kitchen
Figure 47: Small kitchen appliances purchased in the past year, by gender, August 2017
Students the biggest purchasers of small kitchen appliances
Figure 48: Small kitchen appliances purchased in the past year, by working status, August 2017
64% have bought a small kitchen appliance in the past year
Figure 49: Repertoire of small kitchen appliances purchased in the past year, August 2017
Purchasers are much younger than the average
Figure 50: Profile of those who have purchased a small kitchen appliance in the past year, August 2017
IMPORTANT FACTORS WHEN DECIDING WHAT TO BUY
Price and functionality most important
Figure 51: Important factors in choosing what to buy, August 2017
Men look for build quality
Figure 52: Important factors when choosing what to buy, by gender, August 2017
Price and style are key for buyers of kettles and toasters
Figure 53: Important factors when shopping for kettles and toasters, August 2017
Ease of cleaning a focus for small cooking appliances
Figure 54: Important factors when shopping for small cooking appliances, August 2017
Reputation important for coffee machine buyers
Figure 55: Important factors when shopping for coffee machines, August 2017
Reviews sell juicers, mixers and food processors
Figure 56: Important factors when shopping for juicers, mixers or food processors, August 2017
HOW THEY BOUGHT SMALL KITCHEN APPLIANCES
In-store remains the most popular way to shop
Figure 57: How they bought the small kitchen appliance they spent the most on in the past year, August 2017
Smaller, lower-value items most likely to be bought in-store
Figure 58: How they bought the small kitchen appliance they spent the most on in the past year, by what they spent the most on (netted), August 2017
WHERE THEY SHOP
Argos dominates small kitchen appliance sales
Supermarkets chosen by a quarter
Other retailers
Figure 59: Where they shop for small kitchen appliances, August 2017
Supermarkets dominate kettle and toaster purchases
Online retailers lead other product categories
Department stores popular for coffee machines
Figure 60: Where they shop for small kitchen appliances, by what they bought, August 2017
REASONS FOR SELECTING RETAILER
Price the top-ranking reason for choosing where to shop
Figure 61: Reasons for selecting the retailer they used to buy the SKA they spent the most on in the past year, August 2017
Proximity and price drive usage of supermarkets
Figure 62: Relative importance of reasons for shopping for SKA at a supermarket, August 2017
Argos excels on availability and price
Figure 63: Relative importance of reasons for shopping for SKA at Argos, August 2017
Online retailers have the range and delivery options
Figure 64: Relative importance of reasons for shopping for SKA at any online retailer, August 2017
Advice attracts people to specialists
Figure 65: Relative importance of reasons for shopping for SKA at any electrical or home specialist, August 2017
Department stores give confidence
Figure 66: Relative importance of reasons for shopping for SKA at any department store, August 2017
Kettle and toaster shoppers look for convenient availability
Figure 67: Relative importance of factors in selecting the retailer they used to buy a kettle or toaster, August 2017
Price and delivery options drive choice for small cooking appliances
Figure 68: Relative importance of factors in selecting the retailer they used to buy a small cooking appliance, August 2017
Trust important when shopping for coffee machines
Figure 69: Relative importance of factors in selecting the retailer they used to buy a coffee machine, August 2017
Trust and availability important for juicers, mixers and food processors
Figure 70: Relative importance of factors in selecting the retailer they used to buy juicer, mixer or food processor, August 2017
HOW THEY USE SMALL KITCHEN APPLIANCES
Out with the old and in with the new
Money saving appeals to younger consumers
Figure 71: How they use small kitchen appliances, August 2017
Young are more brand-loyal
Figure 72: Agreement with the statement ‘Most of my small kitchen appliances are from the same brand’, by age, August 2017
ATTITUDES TOWARDS SMALL KITCHEN APPLIANCES
Two thirds interested in appliances that are easier to store
Figure 73: Attitudes towards small kitchen appliances, August 2017
Independent reviews are vital to appeal to younger age groups
Figure 74: Any agreement with the statement ’Independent reviews are important when choosing a small kitchen appliance’, by age, August 2017
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology