Major Domestic Appliances - UK - April 2018

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
The market for major domestic appliances slowed in 2017
Figure 1: Consumer spending on major domestic appliances, 2012-22
Property transactions fall 1.1%
Laundry appliances make up the largest segment
Figure 2: Market segmentation for major domestic appliances, 2017
Dixons Carphone the leading retailer
Figure 3: Major domestic appliances, channels to market, 2017
Companies and brands
Growing focus on smart and connected technology
Washing machine saves time and energy
Adspend declines 19.1% in 2017
Samsung is the most trusted brand
Figure 4: Attitudes towards and usage of selected brands, February 2018
The consumer
Major domestic appliances are household essentials
Figure 5: Ownership of major domestic appliances, February 2018
Nearly two thirds bought a new appliance in the past three years
Figure 6: Purchases of major domestic appliances in the last three years, February 2018
Online more popular than in-store
Figure 7: How they bought the major domestic appliance purchased most recently, February 2018
Breakdowns drive sales
Figure 8: Reasons for buying a new major domestic appliance, February 2018
Retailer websites the most popular source of information
Figure 9: Sources of information used when researching which major domestic appliance to buy, February 2018
Price is the most important factor for 38% of buyers
Figure 10: Important factors in deciding which major domestic appliance to buy, February 2018
What we think
ISSUES AND INSIGHTS
Who owns a smart appliance and who’s interested?
The facts
The implications
Will we still own major domestic appliances in the future?
The facts
The implications
Buyers need better guidance on the benefits of energy efficiency
The facts
The implications
What is the role of the physical store for major domestic appliances?
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
The market for major domestic appliances slows in 2017
Laundry appliances make up the largest segment
Dixons Carphone the leading retailer
Property transactions fall 1.1%
Consumer confidence dips but spending intentions remain strong
MARKET SIZE AND FORECAST
Slower spending on major domestic appliances
Market forecast to grow 12.5% by 2022
Figure 11: Consumer spending on major domestic appliances, 2012-22
Figure 12: Consumer spending on major domestic appliances, 2012-22
Forecast methodology
MARKET SEGMENTATION
Laundry appliances the largest segment
Figure 13: Market segmentation for major domestic appliances, 2017
Dishwashers and tumble dryers experience strongest growth
Figure 14: Market segmentation for major domestic appliances, 2011-17
CHANNELS TO MARKET
Dixons Carphone moves towards building a membership scheme
AO continues to grow
Amazon lacks dominance in major appliances
Sainsbury’s/Argos merger paying dividends
A turbulent year in the DIY sector
Figure 15: Major domestic appliances, channels to market, 2017
MARKET DRIVERS
Spending on electricals is boosted by inflation
Figure 16: Percentage change in consumer spending on all electrical products, 2013-17
Property transactions fall 1.1%
Figure 17: Residential property transactions over £40,000, UK, 2006-17
Consumer confidence declines during 2017
Figure 18: Consumer confidence tracker, January 2015-February 2018
Inflation puts a squeeze on incomes during 2017
Figure 19: Average weekly earnings versus CPI, January 2014-March 2018
Electricity prices soar in 2017
Figure 20: Price of utilities and overall CPIH, monthly percentage change compared to a year earlier, February 2017-March 2018
Increase in households should lead to growth
Figure 21: Household size, 2012-22
42% feel repairs make more sense when money is tight
Figure 22: Agreement with the following statement, by age, November 2017
Retail credit increases 9% since 2016
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Growing focus on smart and connected technology
Introducing metal-backed appliances to allay safety concerns
Washing machine saves time and energy
Adspend declines 19.1% in 2017
Samsung is the most trusted brand
COMPETITIVE STRATEGIES
Introducing metal-backed appliances to allay safety fears
LG introduces Google Home-compatible appliances
Bosch integrates Amazon Alexa into Home Connect range
Hoover launches advertising campaign for its smart appliances
Haier focuses on reducing food wastage
Bosch and Siemens appliances set to carry the Quiet Mark
Candy launches Simply-Fi app in the UK
Indesit unveils revamped website
Stoves expands its Mini Range collection
LAUNCH ACTIVITY AND INNOVATION
Fridge that can sniff out food that has expired
Sustainable fridge prototype
Figure 23: World’s first bioplastic concept fridge from Electrolux
FridgeCam gives you a snapshot of what is in your fridge wherever you are
Figure 24: FridgeCam
Washing machine saves time and energy
Figure 25: Samsung WW8800M washing machine
A washing machine that folds clothes and an on-command mobile fridge
Countertop dishwasher for small kitchens
Figure 26: Tetra countertop dishwasher
Connected domestic appliances
Whirlpool’s direct-to-the-consumer home delivery service
ADVERTISING AND MARKETING ACTIVITY
Adspend declines 19.1% in 2017
Figure 27: Total above-the-line, online display and direct mail advertising expenditure on major domestic appliances, 2013-17
Bosch’s share of total sector advertising spend up 25 percentage points
Figure 28: Share of above-the-line, online display and direct mail advertising expenditure on major domestic appliances, 2017
Bosch and Currys increase advertising spend in 2017
Figure 29: Above-the-line, online display and direct mail advertising expenditure on major domestic appliances, by advertiser, 2013-17
TV attracts the highest spend, but its share is declining as advertisers switch to digital
Figure 30: Total above-the-line, online display and direct mail advertising expenditure on major domestic appliances, by media type, 2017
Advertising and marketing campaigns
Bosch pushes technological innovations
Currys Lowest Price campaign
AO.com focusing on building brand awareness
Beko partners with sports radio station talkSPORT
'Hoover, that's who' national advertising campaign
Nielsen Ad Intel coverage
BRAND RESEARCH
Brand map
Figure 31: Attitudes towards and usage of selected brands, February 2018
Key brand metrics
Figure 32: Key metrics for selected brands, February 2018
Brand attitudes: Beko seen as a value-focused brand
Figure 33: Attitudes, by brand, February 2018
Brand personality: Samsung portrays a fun image
Figure 34: Brand personality – macro image, February 2018
Hotpoint seen as user-friendly and affordable
Figure 35: Brand personality – micro image, February 2018
Brand analysis
Samsung is the most recommended brand
Figure 36: User profile of Samsung, February 2018
Bosch is viewed as innovative and reliable
Figure 37: User profile of Bosch, February 2018
Hotpoint is an affordable yet trusted brand
Figure 38: User profile of Hotpoint, February 2018
NEFF appeals to those with the time and money to indulge their passion
Figure 39: User profile of NEFF, February 2018
Beko: the affordable choice
Figure 40: User profile of Beko, February 2018
Zanussi struggles to stand out
Figure 41: User profile of Zanussi, February 2018
Indesit struggles to deliver an excellent experience
Figure 42: User profile of Indesit, February 2018
THE CONSUMER – WHAT YOU NEED TO KNOW
Major domestic appliances are household essentials
64% bought a new appliance in the past three years
Online more popular than in-store
Breakdowns drive sales
Retailer websites are the most popular source of information
Price is the most important factor for 38% of buyers
OWNERSHIP OF MAJOR DOMESTIC APPLIANCES
Major appliances are household essentials
Figure 43: Ownership of major domestic appliances, February 2018
Separate tumble dryers are most popular with families
Figure 44: Washer/dryer ownership, by presence of children, February 2018
Built-in electric ovens the most popular cooking appliance
Figure 45: Ownership of cooking appliances, by age and affluence, February 2018
Half of households own at least five major domestic appliances
Figure 46: Repertoire analysis of major domestic appliance ownership, February 2018
PURCHASING OF MAJOR DOMESTIC APPLIANCES
Laundry appliances are most purchased
Combined fridge-freezers dominate refrigeration sales
Figure 47: Purchases of major domestic appliances in the last three years, February 2018
37% purchased multiple appliances in the past three years
Figure 48: Repertoire analysis of major domestic appliances purchased in the past three years, February 2018
Major domestic appliance purchased most recently
Figure 49: Major domestic appliance purchased most recently (net), February 2018
Plans of non-purchasing owners
Figure 50: Plans for buying a new major domestic appliance, February 2018
HOW THEY SHOPPED
Over half purchased online
Figure 51: How they bought the major domestic appliance purchased most recently, February 2018
Purchase channel differs by reason for making a purchase
Figure 52: How they shopped for major domestic appliances, by reasons for buying a new appliance, February 2018
In-store shoppers prioritise design and ease of use
Figure 53: Relative difference in importance of factors, by how they shopped for major domestic appliances, February 2018
REASONS FOR BUYING A MAJOR DOMESTIC APPLIANCE
Replacements drive sales of major domestic appliances
Consumers want efficient appliances
Figure 54: Reasons for buying a new major domestic appliance, February 2018
Laundry appliance purchases most likely to be driven by breakdowns
Figure 55: Reasons for buying a new laundry appliance, compared to the average for all appliances, February 2018
Parents seeking more capacity help refrigeration sales
Figure 56: Reasons for buying a refrigeration appliance, compared to the average for all appliances, February 2018
Dishwasher purchases most likely to be driven by first-time purchases
Figure 57: Reasons for buying a new dishwasher, compared to the average for all appliances, February 2018
Purchases of cooking appliances driven by room remodelling
Figure 58: Reasons for buying a new cooking appliance, compared to the average for all appliances, February 2018
SOURCES OF INFORMATION USED
Retailer websites the main source of information
The importance of user reviews
Figure 59: Sources of information used when researching which major domestic appliance to buy, February 2018
Older shoppers continue to rely on in-store displays
Figure 60: Sources of information used when researching which major domestic appliance to buy, by age and socio-economic group, February 2018
Those with safety concerns use most sources for research
Figure 61: Average number of sources used for research, by reasons for buying a major domestic appliance, February 2018
Before buying people expect to use more sources of information
Figure 62: Sources of information expected to be used and actually used when deciding which major domestic appliance to purchase, February 2018
IMPORTANT FACTORS IN DECIDING WHAT TO BUY
Distress purchases mean price is a critical factor for many
Ease of use important for almost a third
Figure 63: Important factors in deciding which major domestic appliance to buy, February 2018
Wealthy dads are most interested in innovative features
Figure 64: Important factors in deciding which major domestic appliance to buy, February 2018
Capacity and design are important when buying refrigeration appliances
Ease of use and design are most important for cooking appliances
Innovative features most likely to sell a laundry appliances
Figure 65: Important factors in deciding what to purchase, by major domestic appliance purchased most recently, February 2018
Running costs fall in importance during the purchase process
Figure 66: Difference in priorities between those who have purchased a major domestic appliance in the past three years, and those who haven’t, February 2018
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology