Televisions - US - October 2008

SCOPES AND THEMES
What you need to know
Definition
Data
Abbreviations
Terms
EXECUTIVE SUMMARY
LCD sales driving overall category growth
Increase of time spent on the internet could dampen sales
Cheaper sets, tendency to stay home and new technology drive growth
Samsung, Sony and Vizio lead in LCD sales
Brand has little influence on most customers
Consumers’ knowledge of television technology is low
Blacks and Asians are important groups
Certain segments are more knowledgeable and willing to pay premiums
INSIGHTS AND OPPORTUNITIES
Dynamic pricing
Value created via reliability
Objectivity
Style counts
Figure 1: Interest in TV wall mounting and premium frames, by household income, August 2008
Figure 2: Interest in TV wall mounting and premium frames, by date of most recent purchase, August 2008
Figure 3: Levels of interest in TV wall mounting, by age, August 2008
Figure 4: Levels of interest in paying more for a stylish TV frame, by age, August 2008
Screening rooms
Trade-ins
Background video: artwork, personal photos and videos
Interactive, educational advertainment
Up-conversion and content partnerships
Green living
The CPU/TV single-chassis media center
FAST FORWARD TRENDS
 TREND 1: THE SCI-FI ERA
3DTV
The Jetson’s videophone
 TREND 2: THE DEATH AND REBIRTH OF RETAIL
Figure 6: Online TV purchase, date of most recent purchase of television, August 2008
Figure 7: Online TV purchase, by household income, August 2008
MARKET SIZE AND FORECAST
Retail prices average more than $1K in 2007 as HDTVs gain traction
Figure 8: Screen size and spend on most recent TV purchase, by acquisition date, February 2007-March 2008
Television sales continue to climb despite tough economy
Figure 9: U.S. manufacturer sales of TV sets and displays, at current prices, 2004-09
Figure 10: U.S. manufacturer sales of TV sets and displays, at inflation-adjusted prices*, 2004-09
Increase in volume driving sales
Figure 11: Total U.S. manufacturer volume sales and average selling price of TV sets and displays, 2004-09
A television in every room
COMPETITIVE CONTEXT
Key points
Pay-TV service and digital-analog converters to compete with DTVs
Figure 12: Access to cable/satellite television, by number of TVs in the household, April 2007-June 2008
Online video not a problem… yet
Figure 13: U.S. online video viewers, 2006-12
Figure 14: Hours spent per week using television screens, by willingness to spend $1K+ on TV screen, August 2008
Figure 15: Hours spent per week using television screens, by intent to purchase, August 2008
Figure 16: Hours spent per week using television screens, by date of most recent purchase, August 2008
SEGMENT PERFORMANCE
LCD sales driving overall category growth
LCDs carry more than half of sales as prices on LCD units fall
Figure 17: U.S. manufacturer sales of digital TV sets and displays, by segment, 2004-09
Figure 18: U.S. sales of digital TV sets and displays, by segment, 2005 and 2007*
Figure 19: Most recent TV type purchased, by acquisition date of most recent TV, February 2007-March 2008
SEGMENT PERFORMANCE—LCD TELEVISIONS
LCD sales growth, from meteoric to strong
Figure 20: Total manufacturer sales of LCD flat-panel TVs, at current prices, 2004-12
Figure 21: Total manufacturer sales of LCD flat-panel TVs, at inflation-adjusted prices, 2004-12
Figure 22: U.S. volume sales and average selling price of LCD flat panel, 2004-09
SEGMENT PERFORMANCE—PLASMA TELEVISIONS
Plasma not competitive in under-40-inch arena
Figure 23: Total manufacturer sales of plasma flat-panel TVs, at current prices, 2004-09
Figure 24: Total manufacturer sales of plasma flat-panel TVs, at inflation-adjusted prices, 2004-09
Figure 25: U.S. volume sales and average selling price of plasma flat-panel TVs, 2004-09
SEGMENT PERFORMANCE—FRONT-PROJECTION TVS
Most consumers have no experience with front-projection television
Figure 26: Have watched a front-projection TV, by age, August 2008
Figure 27: Total manufacturer sales of front-projection TVs, at current prices, 2004-09
Figure 28: Total manufacturer sales of front-projection TVs, at inflation-adjusted prices, 2004-09
Figure 29: U.S. volume sales and average selling price of front-projection TVs, 2004-09
SEGMENT PERFORMANCE—REAR-PROJECTION TELEVISIONS
Figure 30: Interest in wall mounting for televisions, by age, August 2008
Figure 31: Total manufacturer sales of digital rear-projection TVs, at current prices, 2004-09
Figure 32: Total manufacturer sales of digital rear-projection TVs, at inflation-adjusted prices, 2004-09
Figure 33: U.S. volume sales and average selling price of digital rear-projection TVs, 2004-09
SEGMENT PERFORMANCE—OLED TELEVISIONS
Organic televisions promise more energy efficiency and superior picture
Figure 34: U.S. manufacturer sales of OLED displays, at current prices, 2008 and 2009
SEGMENT PERFORMANCE—PLAYBACK COMBINATION TVS
Figure 35: Preference for TV with built-in DVD player/recorder, by age, August 2008
Figure 36: Total manufacturer sales of digital playback/television products, at current prices, 2005-08
Figure 37: Total manufacturer sales of combination TVs, at inflation-adjusted prices, 2005-08
Figure 38: U.S. volume sales and average selling price of combination TVs, 2005-08
MARKET DRIVERS
Key points
Broken sets, bedroom TVs and the desire to upgrade drive purchase
Figure 39: Reasons for TV purchase, by household income, August 2008
Millions of tube televisions yet to be replaced
Figure 40: Type of most recent TV type purchased, by household income, February 2007-March 2008
TV when you want it
DVRs
VOD
Transition to digital broadcasting
HDTV content
Figure 41: Total manufacturer sales of HDTVs, at current prices, 2004-09
Challenging economic conditions may be helping sales
Figure 42: Buyers’ remorse over small screen size, by age, August 2008
Television as a social experience
Figure 43: Social use of the television, by age, August 2008
Figure 44: Social use of the television, by date of most recent purchase, August 2008
Demographics and economics
Focus on 35-64s
Figure 45: Cost of most recently acquired TV, by age, February 2007-March 2008
Figure 46: Primary shopper for TVs, by age, August 2008
Figure 47: Household TV ownership, overall incidence and # per household, by age, February 2007-March 2008
Household income predictive of spend
Figure 48: Willingness to spend more than $1K+ on a television, by household income, August 2008
Figure 49: Cost, age and size of most recent TV, by household income, February 2007-March 2008
LEADING COMPANIES
Key points
Market consolidating, budget provider Vizio gaining
Figure 50: North American LCD market share by volume of units shipped, by manufacturer, Q1 2007-Q1 2008
Samsung
Sony
Vizio
Sharp
BRAND QUALITIES
Key points
Only one in six see a difference between leading brands
Figure 51: Perceived differences in quality of TV between leading brands, by age, August 2008
Figure 52: Perceived differences in quality of TV between leading brands, by household income, August 2008
One in three will buy an unknown brand to save money
Figure 53: Buying an unknown TV brand to save $200, by household income, August 2008
If price is not a concern, many choose Sony
Figure 54: Brand preference in the absence of price premiums, by household income, August 2008
Figure 55: Brand preference in the absence of price premiums, by age, August 2008
Figure 56: Brand preference in the absence of price premiums, by year of most recent purchase, August 2008
Vizio is for value
Samsung is for sports
Sony touts its high-end range
Sharp enabling wireless picture viewing
INNOVATION AND INNOVATORS: FOCUS ON PC2TV
Introduction
Uptake ramping up in under-35s
Figure 57: Ownership of device for watching online video on the home television, by age, January 2008
Figure 58: Interest in complete “on-demand” programming, by age, January 2008
Figure 59: Interest in viewing online video on the home TV, by age, January 2008
Sony’s BRAVIA Internet Video Link
Figure 60: Sony BRAVIA Video link
Netflix connects directly to televisions
Figure 61: Netflix set-top boxes from Roku and LG
Apple TV
Figure 62: Apple TV
Vudu
TELEVISION CAMPAIGNS
Introduction
Focusing on sports and gaming with faster LCDs
Figure 63: TV used to invite friends and family over for sports, by date of most recent purchase, August 2008
Samsung’s pitch to sports enthusiasts
Figure 64: Samsung NFL ad, 2007
Figure 65: Samsung NFL Super Bowl promotional price ad, 2008
Variations on the sports theme: Sharp, Sony and Olevia
Figure 66: Sharp Aquos—official HDTV of the baseball league ad, 2008
Figure 67: Sony’s sports ad, 2008
Figure 68: Olevia’s ESPN ad, 2007
Figure 69: Olevia’s X Games ad, 2008
Pitching style
Figure 70: Samsung series 6 ad, 2008
A picture so precise, it seems real
Figure 71: LG Family bobsleigh ad, 2007
It’s a family affair
Figure 72: Panasonic Viera ad, 2007
PRODUCT KNOWLEDGE
Key points
Half of respondents still think digital and HD are the same thing
Figure 73: Understanding of TV technology, by household income and primary shopper, August 2008
Figure 74: Understanding of TV technology, by date of most recent purchase and primary shopper, August 2008
Figure 75: HDTV access and awareness, by household income, August 2008
Figure 76: HDTV access and knoweldge, by date of most recent purchase and primary shopper, August 2008
Figure 77: Blu-ray disc ownership, by date of most recent TV purchase and primary shopper, August 2008
ATTITUDES TOWARD SPEND
Figure 78: TV purchase price-sensitivity, by date of most recent purchase, August 2008
Figure 79: TV purchase price-sensitivity, by age, August 2008
THE RESEARCH PROCESS
Key points
In-store research favored even by internet consumers
Figure 80: Methods of research before TV purchase, by household income, August 2008
Figure 81: Methods of research before TV purchase, by willingness to spend $1K+, August 2008
Under-45s do more research
Figure 82: Methods of research before TV purchase, by age, August 2008
Research growing in importance as recent buyers do more research
Figure 83: Methods of research before purchase, by year of most recent purchase, August 2008
Third-party review sites to become more important
Cnet.com
Testfreaks.com
TVsreview.com
Consumersearch.com
Educational materials on supplier and retailer sites
Sony.com: Home entertainment 101
Rca.com: The room planner
Circuitcity.com: Educating consumers about technology
Best Buy: bestbuy.com: Teaching people how to build a home entertainment system
Walmart.com: Teaching people how to build a home entertainment system
RACE/HISPANIC ORIGIN: FOCUS ON ASIANS AND BLACKS
Key points
Average income by race/Hispanic origin
Figure 84: Household income distribution, by race and Hispanic origin of householder, 2007
Asians over-index on flat-panel TVs
Figure 85: Most recent TV type owned, by race/Hispanic origin, February 2007-March 2008
Blacks spend the most time watching television, particularly sports
Figure 86: Hours spent per week using television screens, by race/Hispanic origin, August 2008
Asians pay premium prices for high-end flat-panel TVs
Figure 87: TV features, by race/Hispanic origin, February 2007-March 2008
Figure 88: Reasons for TV purchase, by race/Hispanic origin, August 2008
Asians more brand-conscious and more keen on Sony and Samsung
Figure 89: Effect of brand on purchase of similar models, by race/Hispanic origin, August 2008
Figure 90: Brand reputation, by race/Hispanic origin, August 2008
Minorities online more willing to pay premium for TV/PC monitor
Figure 91: Willingness to pay more for a TV with PC connectivity, by race/Hispanic origin, August 2008
Minorities more likely to use the TV to entertain friends
Figure 92: TV used to invite friends and family over for sports, by race/Hispanic origin, August 2008
CLUSTER ANALYSIS
Key points
Low-budget basics (48%)
Moderates (34%)
Tech-savvy enthusiasts (18%)
Cluster characteristics
Figure 93: Television owner clusters, August 2008
Figure 94: Television usage per week, by clusters, August 2008
Figure 95: Expected time until the purchase of a new TV, by clusters, August 2008
Figure 96: Years since household bought last new television, by clusters, August 2008
Figure 97: Reasons for TV purchase, by clusters, August 2008
Figure 98: Attitudes about one’s personal television set, by clusters, August 2008
Figure 99: Attitudes about televisions, by clusters, August 2008
Figure 100: TV purchase research, by clusters, August 2008
Figure 101: Brand preference, by clusters, August 2008
Cluster demographics
Figure 102: Television owner clusters, by gender, August 2008
Figure 103: Television owner clusters, by age, August 2008
Figure 104: Television owner clusters, by household income, August 2008
Figure 105: Television owner clusters, by race/Hispanic origin, August 2008
Methodology
CUSTOM CONSUMER GROUPS
Key points
Purchase motivations changing rapidly
Figure 106: Reasons for getting a new television, by year of most recent purchase, August 2008
Figure 107: Reasons for getting a new television, by willingness to spend $1K+, August 2008
Capturing the high-end buyer
Figure 108: Tendency to invite friends to watch set and importance of Blu-ray, HDTV and style, by willingness to spend $1K+, August 2008
Anticipating the desires of this year’s Christmas TV shoppers
Figure 109: Preferences and attitudes, by expected date of next television purchase, August 2008
Asians/affluent couples spend the most
Figure 110: Average cost of most recent TV, by key affluent couples and Asian groups, February 2007-March 2008
Figure 111: Average number of years ago when most recent TV set was acquired, by most recently purchasing custom consumer group, February 2007-March 2008
APPENDIX: ADDITIONAL RACE/HISPANIC ORIGIN TABLES
Figure 112: Attitudes about TV and price (in general), by race/Hispanic origin, August 2008
Figure 113: Years since household bought last new television, by race/Hispanic origin, August 2008
Figure 114: Expected time until the purchase of a new TV, by race/Hispanic origin, August 2008
Figure 115: Method for researching TV before purchase, by race/Hispanic origin, August 2008
Figure 116: Reasons for TV purchase, by race/Hispanic origin, August 2008
Figure 117: Social use of TV, by race/Hispanic origin, August 2008
APPENDIX: ADDITIONAL RESPONSES BY AGE
Figure 118: Reasons for TV purchase, by age, August 2008
Figure 119: Reasons for TV purchase, by age, August 2008
Figure 120: Years since household bought last new television, by age, August 2008
Figure 121: Reasons for TV purchase, by age, August 2008
Figure 122: Reasons for TV purchase, by age, August 2008
APPENDIX: ADDITIONAL RESPONSES ABOUT TV FEATURES
Figure 123: TV features, by age, February 2007-March 2008
Figure 124: TV features, by race/Hispanic origin, February 2007-March 2008
Figure 125: TV features, by household income, February 2007-March 2008
APPENDIX: TRADE ASSOCIATIONS