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Full-line accessories makers, namely Jasco, Fellowes and Gemini, have posted very healthy 2003 results, and all are anticipating even better business this year. These companies have the advantage of spreading accessories sales across many product borders. When one segment cools, another picks up the slack. New full-liner Thomson, purchaser of the Recoton line, has joined the group.
"Based upon our current momentum, an improving economy and some up-tick in CE equipment sales, we are convinced that the first half of 2004 will be very strong," said Kent Shiplet, executive VP/marketing and sales at Oklahoma City-based Jasco Products. "We are projecting strong growth in the following categories.
"In audio/video, look for [a surge in] home theater accessories, including mid to higher end connectivity, speaker stands and wall mounts. RF modulators remain strong, yet not at the 2002 levels. Mid-price-point remotes, with added features for today's diverse CE equipment [should do well].
"Surge protection [takes in] multimedia surge protection models that have gained traction and are poised for strong growth. Computers, [namely] wireless desk tops (mouse and keyboard) with expanded features are very hot. The expansion of peripheral equipment is driving the demand of USB hubs. PC camera usage has now become mainstream, and sales should continue strong for 2004. Multimedia speakers for use with computers or gaming are experiencing strong growth.
"[In other categories] demand for MP3 accessories is very strong. Our GE-branded line is creating a lot of excitement in this 'under-served category.' Hands-free phone, cellular and PC head and ear sets are experiencing strong growth."
"A number of the technology sectors showed signs of recovery during the third and fourth quarters of 2003," said Jude Rake, executive VP/chief marketing officer at Itasca, Ill.-based Fellowes.
"The PC category showed strong unit growth in Q3, growing nearly 14 percent to 16 percent over Q3 in 2002, and a number of analysts are projecting continued strong unit sales in Q4. This growth had been fueled by notebook computers, which continue to show very strong growth, and desktop PC's during the last two quarters have also been showing positive unit sales growth. IDC is projecting PC shipments in 2004 to increase by more than 10 percent.
"Cellular phones, driven by cameras and new features continued to show strong sales growth through 2003 and are expected to continue to have good growth in 2004. These trends provide the basis for a strong first half of 2004 for the consumer electronics accessories business.
"We are very positive about the Fellowes' consumer electronics accessories business for the first half of 2004. Our focus [in the first half] will be on bringing the market innovative, new products that make it easier for the consumer to use and work with their new electronic products.
"We are looking at continued strong sales in cellular accessories driven, by high product functionality, stylish design and the strong franchise of the Body Glove brand among consumers in this sector.
"Our consumer-need based new product development and the extremely strong growth in notebooks will continue to fuel strong growth in our mobile accessories category.
"A total revamp of our traditional desktop/workstation accessories — focused on assisting the consumer develop a more comfortable, organized and attractive workspace and effectively integrating the management of paper and technology products — will drive strong growth in our ergonomic and media storage accessories categories."
"I expect the overall accessories business in the first half of 2004 to continue to be robust as a result of continued sales of digital products, specifically DVD players and digital televisions," said Mike O'Neal, president/CEO at Clifton, N.J.-based Gemini Industries. "Accelerated convergence of products will ensure that connectivity related accessories products will be exceedingly important to the overall sales of major retail customers.
"Gemini sees its business in the first half continuing to grow as a result of its entry into many new accessory categories. These new categories — including gaming, imaging and computer related accessory products — reflect a movement in the accessories business to convergence related products.
"For Gemini, much of its sales growth will come from its new categories of gaming, imaging and computer related accessories. Of its traditional categories, sales of video accessories continue to be strong based upon DVD players and digital television sales.
"I believe that many retailers are seeing accessories as an increasingly critical component of their overall CE business given the significant gross profit generated through sales of these products. This will give rise to a greater investment in assortments, merchandising and space allocation.
"The single most significant challenge that retailers and manufacturers continue to encounter is consumer confusion on the set-up and use of new CE technologies. This confusion has resulted in a reluctance among many consumers to upgrade their CE products. What we all need to continue to do is look at ways to improve consumer knowledge and confidence."
A new full-line player, Paris-based Thomson, has tucked the CE accessories categories, recently purchased from Recoton, into its product offerings for 2004. For this French company, with its RCA-brand product lineup marketed in the United States out of Indianapolis, "the accessories category is major focus and we remain optimistic about the business outlook for 2004," said David Geise, VP/worldwide Consumer Solutions.
"The accessories industry has a direct correlation to consumer electronics hardware sales and we anticipate that increased focus by retailers who offer accessories to complement a hardware purchase will drive sales and offset declines in some traditional hardware categories.
"Continued growth in DVD, high definition television, HDTV/satellite set-top boxes, hard-disc recorders, digital cameras, MP3 players, and computers will have a positive impact on the accessories category — especially for connectivity, reception, media and imaging, power and computer products.
"Thomson is very bullish about the future of this category. We have made significant investments to build our Consumer Solutions accessory business, including the purchase of Recoton's accessory assets and brands in July 2003.
"Going into 2004, we will be offering an expanded product portfolio under the RCA, AR, Jensen, Ambico, Recoton, Discwasher, Advent and SpikeMaster brands. With our unique combination of products and services we will provide opportunities for retailers to increase accessories sales and improve overall profitability."
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.