Innovative home entertainment devices spur growth in a frail economy
TORONTO, March 13, 2013 – The increasing popularity of home entertainment appliances, such as single-serve coffee makers, slow cookers and electric wine chillers, is giving today’s retail environment a much-needed boost and is demonstrating the ability of the small domestic appliance (SDA) category to thrive in a weak economy. Driven by the kitchen electrics segment, SDAs have been a bright spot in Canada over the past few years according to Inside the Canadian Home: Appliances We Own & Use 2012, a recent report from global research company The NPD Group, and has posted consistent growth through last year.
Up five per cent, the kitchen electrics segment represented 57 per cent of total SDA dollar sales in Q4 2012. Naturally, this growth has caught the attention of traditional appliance manufacturers and companies from other industries, such as consumer electronics and information technology, that hope to profit from the steady success.
“The introduction of innovative appliances that can simplify day-to-day life or that provide eco-friendly purchase alternatives has been hugely beneficial for the retail sector, as consumers have been consistently enthusiastic about bringing these products into their homes,” said Armin Begic, manager of Home Appliances at The NPD Group. “Given this, there is a definite opportunity for other sectors to become part of the appliance landscape by learning how they can collaborate or compete with existing manufacturers.”
Among the top 10 items owners use every week, seven are within the beverage category. After years of in-home success, single-serve coffee makers still present the highest usage (64 per cent), followed by electric water kettles (51 per cent) and drip coffee makers (51 per cent). However, soda makers (47 per cent), espresso/cappuccino makers (37 per cent), electric wine chillers (37 per cent) and percolators (28 per cent) are gaining ground and helping to boost sales. Further, the top 10 items with the highest penetration rates in 2012 are consistent with those two years ago. Notably, toasters continue to take the top spot and slow cookers have narrowed the second-place gap with a five per cent climb.
“The trend we’re seeing with small appliance purchases is fueled by the increased desire to entertain at home,” continued Begic. “Though people do not tend to buy major appliances often, smaller gadgets that enhance the experience of having friends and family over and that improve the overall look of the kitchen with a nominal investment are purchased with much more frequency.”
Major domestic appliances (MDAs) are also contributing to the upswing of the industry, with one in five households (19 per cent) likely to purchase at least one major appliance within the next six months. The most popular among them are dishwashers (six per cent) followed by a three-way tie for counter-top microwave ovens, full-size refrigerators and dryers (four per cent).
When making purchases, consumers perceive price to be the most important factor across most segments, followed by features, brand and design/style/aesthetics. However, when asked to rate their willingness to pay more for digital features (clock, programming mode, speed, temperature and timer), over half reported that, though they are a great addition to a desired product, they are not willing to invest more money in them.
This report is based on an online survey fielded to NPD’s Canadian Consumer Panel. The survey was fielded to a representative sample of male (12 per cent) and female (88 per cent) Canadian heads of household, ages 18-64, English and French. The survey contained approximately 30 questions and was fielded January 3 to January 14, 2013 with 1,562 completions.