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Home Entertainment Technology: Hardware & Services - US - 2021

OVERVIEW
What you need to know
Definition
Market context
Economic and other assumptions
COVID-19: US context
EXECUTIVE SUMMARY 
Top takeaways
Market overview
Impact of COVID-19 on home-entertainment hardware and services
Figure 1: Short-, medium- and long-term impact of COVID-19 on home-entertainment technology, 2021
Opportunities and challenges
High-end TVs replace older models, helps keep families content with their entertainment
Figure 2: Most recent TV purchase – connectivity, resolution, and size, 2020 and 2021
In response to pandemic, studios pivot to bring more content direct to consumers
Figure 3: Attitudes toward home-entertainment tech – digital rentals vs movie theaters, by party hosting plans and parental status, 2021
Virtual reality headsets finally find a foothold
Figure 4: Entertainment device ownership and interest – VR headset, by generation, 2021
Global computer chip shortage puts pressure on manufacturers
Red-hot housing market and increase in first-time buyers spurs spending on the home
THE MARKET – KEY TAKEAWAYS
Significant growth for home entertainment technology underway for 2021
Spending on TVs drives rising hardware sales 
Streaming spending grows while live TV stems yearly declines
Lowering concern over COVID-19 could be upended by the Delta variant 
Government stimulus and relief spending bolsters consumer spending
Global computer chip shortage limits inventory and raises prices
MARKET SIZE AND FORECAST
2021 will be a banner year for home entertainment spending
Figure 5: Total US consumer expenditures and fan chart forecast for home entertainment hardware and services, at current prices, 2016-26
Figure 6: Total US consumer expenditures and forecast for home entertainment hardware and services, at current prices, 2016-26
Impact of COVID-19 on home entertainment
Figure 7: Worry about COVID-19 exposure and lifestyle disruption, March 2020 – July 2021
Figure 8: Comfort going to the movies, May 2021 – July 2021
Figure 9: Comfort going to a live event, May 2021 – July 2021
SEGMENT PERFORMANCE 
Home entertainment hardware spending expected to surge for 2021
Figure 10: Total US consumer expenditures and fan chart forecast for home entertainment hardware, at current prices, 2016-26
Figure 11: Total US consumer expenditures and forecast for home entertainment hardware, at current prices, 2016-26
Streaming services drives spending
Figure 12: Total US consumer expenditures and forecast for home entertainment services, at current prices, 2016-26
Figure 13: Total US consumer expenditures and forecast for home entertainment services, at current prices, 2016-26
MARKET FACTORS 
Preventative measures return as COVID-19 variants rapidly spread
Government stimulus and relief packages sustained household spending
Figure 14: CBO estimates of US GDP and effects of pandemic stimulus legislation, Q1 2020 – Q4 2021
Figure 15: Personal consumption expenditures, Q1 2020 – Q2 2021
Home sales surge 20% in 2020
Figure 16: US home annual home sales, 2010-20
Figure 17: US home monthly home sales, January 2010 – June 2021
Figure 18: Share of first-time home buyers, by age, 2020
Computer chip shortage impacting key categories in home entertainment
TV prices increase as much as 30% for high-end models
Retailers unable to meet demand for the latest video game consoles
COMPANIES AND BRANDS – KEY TAKEAWAYS 
Samsung leads global TV market for 15th consecutive year
LG targets high-end consumers with Signature line and first rollable TV
Netflix’s North American memberships stall while revenues grow
Disney continues to innovate and focus on streaming platforms
Facebook’s Oculus leads VR market despite recalls on the Oculus Quest 2
Sony and Microsoft battle it out in console sales and game subscriptions
MARKET SHARE
Samsung’s TVs lead the global market
Xbox Live passes 100 million monthly active users
Figure 19: Daniel Ahmad Xbox Series X|S estimates, July 2021
PlayStation Plus reaches 47 million active subscribers
Sony announces it has secured computer chips for PS5 production targets
Netflix North American paid memberships plateau in first half of 2021
Figure 20: Netflix North American revenues and paid memberships, 2017 – Q2 2021
Disney suite of streaming services sees major success 
Facebook’s Oculus leads VR market 
Alternative VR brands can erode Facebook’s leading position
COMPETITIVE STRATEGIES AND OPPORTUNITIES
Figure 21: Mintel Trend Drivers and supporting Pillars – Technology
Disney makes ESPN+ available on its Hulu platform
AT&amp;T spins off WarnerMedia to Discovery
Facebook trials ads in Oculus VR environment
Figure 22: Blaston Twitter post, June 2021
LG targets the ultra-high-net-worth with its Signature line and luxury brand collaboration
THE CONSUMER – KEY TAKEAWAYS  
TVs are getting bigger, sharper and smarter
Gen Z and Millennial gamers drive VR headset ownership
Half of consumers plan to host a party/gathering this year
Six in 10 consumers spent more time at home due to COVID-19
Robust demand for connected home entertainment devices 
Nearly half fall under the Digital Entertainers consumer segment
MOST RECENT TV PURCHASE
One in five households purchased a TV in the past six months
Figure 23: Most recent TV purchase – timing, 2020 and 2021
Younger men drive TV purchasing
Figure 24: Most recent TV purchase – timing, by gender and age, 2021
Household income has minimal impact on purchase rates 
Figure 25: Most recent TV purchase – timing, by household income, 2021
TVs are getting larger, sharper and more connected
Figure 26: Most recent TV purchase – connectivity, resolution, and size, 2020 and 2021
Middle class splurges on high-end TVs despite price increases
Figure 27: Most recent TV purchase – connectivity, size and resolution, by household income, 2021
Figure 28: TVs purchased within the past six months – connectivity, size and resolution, by household income, 2021
Hispanic households on par with White households in high-end TV purchasing
Figure 29: Most recent TV purchase – connectivity, size and resolution, by race/Hispanic origin, 2021
ENTERTAINMENT DEVICE OWNERSHIP AND INTEREST
Streaming devices lead overall household device ownership 
Figure 30: Entertainment device ownership and interest, 2021
Gen Z and Millennial gamers will drive household VR adoption
Figure 31: Entertainment device ownership and interest – VR headset, by generation, 2021
PARTY HOSTING PLANS
Nearly half plan to host people at home within the next six months
Figure 32: Party hosting plans within the next six months, 2021
Fathers most likely to host a gathering in the next six months
Figure 33: Party hosting plans within the next six months, by gender, age, marriage and parental status, 2021
Party hosting correlates with household income and device ownership
Figure 34: Party hosting plans within the next six months, by household income, 2021
Figure 35: Entertainment device ownership and interest, by generation, 2021
Figure 36: Most recent TV purchase – connectivity, size and resolution, by plans to host a party/gathering in the next six months, 2021
DEVICES FOR PARTY HOSTING
Big screen TVs top devices for party hosting
Figure 37: Devices for party hosting, 2021
Gen Z most interested in gaming, karaoke and social media integration
Figure 38: Devices for party hosting, by generation, 2021
Younger women interested in audio-based devices and services
Figure 39: Devices for party hosting, by gender and age, 2021
Ideal home entertainment system for hosting
Figure 40: TURF Analysis – party devices, 2021
IMPORTANT FEATURES OF AN ENTERTAINMENT ROOM
TV, furniture and sound systems are the most important features
Figure 41: Important features of an entertainment room, 2021
Older consumers focus on TV and sound – while younger consumers consider video games as an important feature
Figure 42: Important features of an entertainment room, by age, 2021
Presence of children elevates value of video games for entertainment
Figure 43: Important features of an entertainment room, by parental status, 2021
HOME ENTERTAINMENT BEHAVIORS
Six in 10 consumers stayed home more due to COVID-19
Figure 44: Home entertainment behaviors, 2021
Parents far more active in the home entertainment space
Figure 45: Home entertainment behaviors, by parental status, 2021
Party hosts plan to spend less time at home in the next 12 months
Figure 46: Home entertainment behaviors, by party hosting plans, 2021
ATTITUDES TOWARD HOME ENTERTAINMENT TECH
TV is essential for a home entertainment room, but not necessary for every type of party
Figure 47: Attitudes toward home entertainment tech – TVs, 2021
Figure 48: Attitudes toward home entertainment tech – TVs, by gender and age and party hosting plans, 2021
Saving money is a top reason – but not the only reason – for spending leisure time at home
Figure 49: Attitudes toward home entertainment tech – Home vs public, 2021
Figure 50: Attitudes toward home entertainment tech – digital rentals vs movie theaters, by party hosting plans and parental status, 2021
Demand for connected devices growing
Figure 51: Attitudes toward home entertainment tech – speakers and devices, 2021
Figure 52: Attitudes toward home entertainment tech – speakers and devices, by gender and age, 2021
CONSUMER SEGMENTATION – ATTITUDES TOWARD HOME ENTERTAINMENT
Figure 53: Home entertainment technology consumer segments, 2021
Disconnected Recluses (23%)
Characteristics
Figure 54: Profile of Disconnected Recluses, 2021
Opportunities
Figure 55: Attitudes toward home entertainment tech – home vs public and party hosting plans, by consumer segments, 2021
Digital Entertainers (48%)
Characteristics
Figure 56: Profile of Digital Entertainers, 2021
Opportunities
Figure 57: Devices for party hosting, by consumer segments, 2021
Outside Leisure Seekers (29%)
Characteristics
Figure 58: Profile of Outside Leisure Seekers, 2021
Opportunities
Figure 59: Home entertainment behaviors, by consumer segments, 2021
Figure 60: Attitudes toward home entertainment tech, by consumer segments, 2021
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Forecast
Consumer survey data
Consumer qualitative research
Marketing creative
Abbreviations and terms
Abbreviations
APPENDIX – THE MARKET
Figure 61: Total US consumer expenditures and forecast for home entertainment hardware and services, at inflation-adjusted prices, 2016-26
Figure 62: Total US consumer expenditures and forecast for home entertainment hardware, at inflation-adjusted prices, 2016-26
Figure 63: Total US consumer expenditures and forecast for home entertainment services, at current prices, 2016-26

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