Small Domestic Appliances - UK - November 2019

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
Consumer spending on small domestic appliances rises by 7.5%...
Figure 1: Consumer spending on small domestic appliances, 2014-24
Interest in health and wellbeing drives small kitchen and air treatment appliance sales
Figure 2: Estimated consumer spend on small domestic appliances, by segment, 2019
Price deflation and wage growth buoy consumer confidence
Online-only players consolidate, while multichannel integration grows crucial
Companies and brands
Space-saving solutions lead the way in innovation
Advertising spend fell by 8.9% in 2018
Consumers are happy to pay more for Bosch and Dyson appliances
Morphy Richards should build on its strengths to revamp its brand
The consumer
Appliance ownership is near-universal
Over two thirds of consumers made a purchase in the past year
Figure 3: Small domestic appliances purchased in the past 12 months, August 2019
Price remains paramount in deciding purchases
Figure 4: Important factors when deciding what to buy, August 2019
The majority of purchases are made online, but stores remain essential
Figure 5: How consumers bought their small domestic appliance, August 2019
Amazon takes the crown as top retailer
Figure 6: Where they shop, August 2019
The prioritisation of price and product range drive consumers online
Figure 7: Reasons for selecting retailer, August 2019
The lack of space limits newer uptake
Figure 8: Use and purchase of small domestic appliances, August 2019
Health-consciousness and tech advancements drive opportunities for future growth
Figure 9: Attitudes towards small domestic appliances, August 2019
What we think
ISSUES AND INSIGHTS
The opportunity for small domestic appliances in the burgeoning smart home market
The facts
The implications
Increasingly cramped homes underpin the need for space-saving appliances
The facts
The implications
How will consumer confidence fare in the year ahead?
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Consumer spending rises by 7.5%...
…but this is forecast to contract with uncertainty ahead
Innovation and mounting interest in health drive sector sales
Price deflation and wage growth boost new uptake
Consumer confidence rises despite uncertainty
Online-only players consolidate, while multichannel proves crucial
MARKET SIZE AND FORECAST
Price deflation and wage growth buoy new purchases amid uncertainty…
…but uncertainty could intensify with the general election and new Brexit date
Figure 10: Consumer spending on small domestic appliances, 2014-24
Figure 11: Consumer spending on small domestic appliances, 2014-24
Forecast methodology
MARKET SEGMENTATION
Vacuum cleaner innovation drives sales
Health-conscious consumers champion air fryers and air purifiers
Coffee connoisseurs compensate for the contraction in capsules
Figure 12: Estimated consumer spend on small domestic appliances, by segment, 2019
Figure 13: Estimated consumer spend on small domestic appliances, by segment, 2019
MARKET DRIVERS
The return of real wage growth
Figure 14: Great Britain average weekly earnings annual growth rate, total pay (real), May 2014-May 2019
Inflation in the market has fallen since the turn of the year
Figure 15: Monthly CPIH, % growth on previous year, August 2018-August 2019
Consumer confidence remains resilient despite uncertainty
Figure 16: Consumer confidence in the state of their finances and their finances compared to the previous year, January 2017-October 2019
Consumers continue to take on credit
Figure 17: Monthly consumer credit gross lending (excluding student loans), August 2017-August 2019
Housing transactions remain high despite recent cooldown
Figure 18: Number of residential housing transactions over £40,000, 2009-18
The UK’s growing weight problem opens an opportunity for health aids in the kitchen
Figure 19: Consumers’ perceptions of the healthiness of their habits, August 2018
Figure 20: Trends in BMI, England, 1995-2017
Connoisseurs drive demand for coffee appliances
Figure 21: Types of coffee drunk, June 2019
Promotions and sales
Figure 22: Electrical items purchased during Black Friday 2017, by age, December 2017
Small domestic appliances remain a popular gift option
CHANNELS OF DISTRIBUTION
Online-only consolidates as the purchasing journey migrates online
Argos and Currys lead the way in multichannel retail
Department stores struggle amid high street uncertainty
Figure 23: Estimated channels of distribution, 2019
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Space-saving solutions lead the way in innovation
Advertising spend fell by 8.9% in 2018
Consumers are happy to pay more for Bosch and Dyson appliances
Morphy Richards should build on its strengths to revamp its brand
LAUNCH ACTIVITY AND INNOVATION
Never run out of coffee again
Figure 24: illy Y5 Espresso and Coffee Machine with integrated Amazon Dash Replenishment System, October 2019
LG targets Artificial Intelligence with the ThinQ home appliance brand
Heatworks launches a space-saving countertop dishwasher…
Figure 25: Heatworks Tetra, October 2019
…and a battery-powered, temperature-controlling kettle
Figure 26: Heatworks Duo Carafe, October 2019
Nespresso launches its smallest ever coffee machine
Smart kettle integrates biometrics to make the perfect brew
The ‘future of blending’
Panasonic eyes up wellbeing in the kitchen
ADVERTISING AND MARKETING ACTIVITY
8.9% drop in advertising spend in 2018
Figure 27: Total above-the-line, online display and direct mail advertising expenditure on small domestic appliances, 2015-2018
Advertising spend peaks in Q4
Figure 28: Total above-the-line, online display and direct mail advertising expenditure on small domestic appliances, Q1-Q4 2018
Vacuum cleaner brands step up advertising amid growing competition
Figure 29: Top 10 spenders on above-the-line, online display and direct mail advertising on small domestic appliances, 2015-2018
TV dominates total spend
Figure 30: Recorded above-the-line, online display and direct mail total advertising expenditure on small domestic appliances, by media type, 2015-2018
Leaders favour TV, but adopt varied advertising strategies
Figure 31: Recorded above-the-line, online display and direct mail total advertising expenditure on small domestic appliances, by advertiser and media type, 2018
Campaign highlights
Gtech sings up with Channel 4 for Gogglebox sponsorship
A work of art for worktops: Russell Hobbs launches new digital campaign
‘Cordless’ Dyson banned by the Advertising Standards Authority
Nielsen Ad Intel coverage
BRAND RESEARCH
Brand map
Figure 32: Attitudes towards and usage of selected brands, October 2019
Key brand metrics
Figure 33: Key metrics for selected brands, October 2019
Brand attitudes: Dyson at the forefront of innovation
Figure 34: Attitudes, by brand, October 2019
Brand personality: Kenwood and Russell Hobbs champion accessibility
Figure 35: Brand personality – Macro image, October 2019
Morphy Richards could do with strengthening its brand image
Figure 36: Brand personality – Micro image, October 2019
Brand analysis
Consumers are happy to pay more for Bosch’s consistently high quality
Figure 37: User profile of Bosch, October 2019
Kenwood’s accessible and affordable brand lends itself to younger shoppers
Figure 38: User profile of Kenwood, October 2019
Russell Hobbs appeals to old and young shoppers alike
Figure 39: User profile of Russell Hobbs, October 2019
Dyson championed by older, rural homeowners
Figure 40: User profile of Dyson, October 2019
Morphy Richards lacks a point of difference, and struggles among younger consumers
Figure 41: User profile of Morphy Richards, October 2019
THE CONSUMER – WHAT YOU NEED TO KNOW
Appliance ownership is near-universal
Over two thirds of consumers made a purchase in the past year
Price remains paramount in deciding purchases
The majority of purchases are made online, but stores remain essential
Amazon takes the crown as top retailer
The prioritisation of price and product range drive consumers online
The lack of space limits newer uptake
Health and tech advancements drive opportunities for future growth
OWNERSHIP OF SMALL DOMESTIC APPLIANCES
Kettles and toasters dominate worktops
Figure 42: Ownership of small domestic appliances, August 2019
Younger consumers look to less traditional appliances
Figure 43: Ownership of small domestic appliances, by age, August 2019
Ownership peaks among settled dwellers
Figure 44: Ownership of small domestic appliances, by duration in dwelling, August 2019
Ownership is widespread
Figure 45: Repertoire analysis of small domestic appliances ownership, August 2019
PURCHASES OF SMALL DOMESTIC APPLIANCES
Two thirds of consumers purchased an appliance in the past year
Figure 46: Small domestic appliances purchased in the past 12 months, August 2019
Younger consumers spearhead demand
Figure 47: Small domestic appliances purchased in the past 12 months, by age, August 2019
However, vacuum cleaners top spending
Figure 48: Small domestic appliances that consumers spent the most on in the past 12 months, August 2019
IMPORTANT FACTORS WHEN DECIDING WHAT TO BUY 
Price remains king…
…but the importance of functionality is evolving
The need for style and brand grows among more affluent consumers
Figure 49: Important factors when deciding what to buy, August 2019
Essential appliances spearhead the need for price
Figure 50: Important factors when deciding what to buy, by purchases in the last 12 months, August 2019
HOW CONSUMERS BOUGHT THEIR SMALL DOMESTIC APPLIANCE
Online channels consolidate in purchasing journey
The development of multichannel…
…as stores remain essential for many
Figure 51: How consumers bought their small domestic appliance, August 2019
Consumers increasingly confident of buying big-ticket products online
Figure 52: How consumers bought their small domestic appliance, by purchases, August 2019
WHERE THEY SHOP
Amazon takes the top spot
Argos holds strong despite takeover upheaval
Currys dominates the specialists
Supermarkets still account for a third of consumers
Figure 53: Where they shop, August 2019
Many consumers still seek the assurance of stores in larger purchases
Supermarkets remain the domain of cheaper purchases
Figure 54: Purchases in the last 12 months, by retailers purchased from, August 2019
The majority of in-store shoppers stuck to one store
Figure 55: Repertoire analysis of where they shop in-store, August 2019
Online shoppers were more likely to visit multiple retailers
Figure 56: Repertoire analysis of where they shop online, August 2019
REASONS FOR SELECTING RETAILER
The prioritisation of price and product range favour online retailers…
…but retailers with stores benefit from trust and local presence
Figure 57: Reasons for selecting retailer, August 2019
USE AND PURCHASE OF SMALL DOMESTIC APPLIANCES 
Daily appliance use is near-universal, but some products sit forgotten
The lack of space is a growing concern
Product reviews take centre stage as browsing migrates online
Figure 58: Use and purchase of small domestic appliances, August 2019
New movers head to the sales
Figure 59: Use and purchase of small domestic appliances, by duration in home, August 2019
ATTITUDES TOWARDS SMALL DOMESTIC APPLIANCES 
Consumers low on space spearhead the need for storage solutions
Time-pressed consumers look to self-cleaning features
Burgeoning interest in health and wellbeing is a major avenue for growth
Over a third of younger consumers would be interested in rental
Figure 60: Attitudes towards small domestic appliances, August 2019
The perceived need for in-store visits limited by location
Figure 61: Agreement with the statement 'It is necessary to visit a store when buying small domestic appliance purchases', by area, August 2019
Older consumers remain sceptical of connected tech
Figure 62: Agreement with the statement 'Small domestic appliances with connected smart technologies are appealing', by age, August 2019
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology