iSuppli: Vizio, Panasonic Rise Above Consolidation
By Greg Tarr -- TWICE, 2/20/2009
El Segundo, Calif. — A newly released fourth-quarter 2008 TV brand-share study from market research firm iSuppli revealed an increasing trend toward value-oriented products as the country’s economy continued to worsen in the critical holiday buying period.
The study revealed that Samsung was again the top flat-panel TV brand, but Sony, the previous No. 2, dropped into the No. 3 position as value-driven brand Vizio moved into second place with 14.3 percent of the overall U.S. flat-panel TV market.
The firm credited Vizio’s combination of competitive price/performance, increased marketing efforts, popular retail channels and rising brand recognition with contributing to the performance.
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iSuppli Table: U.S. Branded Flat panel-TV Market Share Percentage Ranking (Ranking by Percentage of Unit Shipments) |
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Vizio’s flat-panel market share grew 3.11 percentage points, from 11.2 percent, in the third quarter of 2008, iSuppli said. In contrast, premium brands Sony and Samsung saw declines of 0.42 percent and 0.62 percent, respectively, during the same period.
Sony’s share declined to 13.5 percent in the fourth quarter, down from 13.9 percent in the third quarter, while Samsung accounted for a 20.2 percent share in Q4 2008.
Vizio’s U.S. achievements in the period were second only to No. 4 brand Panasonic, which saw its flat-panel TV shipments rise by 3.12 percent in the period.
“Vizio’s success in the fourth quarter was partly due to increasing brand recognition, courtesy of the company’s strong marketing efforts and retail strategy,” said Riddhi Patel, principal analyst, television systems, for iSuppli. “A cornerstone of Vizio’s selling strategy is Wal-Mart, the world’s largest retailer, which features the company’s LCD-TV products. U.S. consumers in November and December 2008 bought more televisions at Wal-Mart than at Best Buy, the first time this has occurred in the two years iSuppli has been conducting research in this area.”
As for TV retail performance in September and October 2008, flat panel-television unit sales at Best Buy exceeded those of Wal-Mart by 2.9 and 3.3 percentage points, respectively, according to a survey of U.S. consumers conducted by iSuppli’s U.S. Television Consumer Preference Analysis service. However, in November, flat-panel sales at Wal-Mart exceeded those at Best Buy by 2.3 percentage points, making Wal-Mart the biggest flat-panel seller in the United States. In December, the sales gap grew to 2.9 points.
“This is an indication that in the present tough economic climate, consumers are becoming less brand conscious and prefer televisions that they perceive to have good picture quality and that are less expensive compared to the competition, rather than seeking models with a lot of extra features,” Patel added.
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iSuppli Figure: U.S. Consumer Television Retailer Preferences (Percentage of Unit Sales) |
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Despite the gains made by some companies, the U.S. television market has been impacted by the recession and the past two quarters, iSuppli said, as consumer spending has decelerated and the pace of sales of big-ticket items like LCD-TVs have slowed.
As a result, a number of TV brands have begun to disappear from the market, including Olevia and, most recently, Pioneer.
“Brands are finding it hard to survive in the current economic climate amid tough price competition,” Patel said. “During 2009, a few value brands will disappear from the market. The brands that survive will be the ones that either own or have very close ties with the LCD and plasma panel makers, allowing them to keep their costs down.”
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It has become painfully obvious that customers are only concerned about the initial cost of the TV, receiver, etc. Service after the sale is either beyond their comprehension or beyond their willingness to pay for it. How else to explain the millions of sales by the hacks at Costco or Walmart or the billions of sales done via questionable internet sites?
Logically you'd presume that people would be more willing to pay for great service in the CE business as opposed to say the hotel business, but for whatever reason folks that pay 5-10 times what a hotel room is worth at a Four Seasons or Ritz will not do it when it comes to what most people value as the most important thing in their house - the TV.
It doesn't make much sense logically but to ignore the facts will assist in getting your gravesite dug very quickly these days.
Sarah Connor - 2009-21-2 07:24:00 EST -
People do not really care about quality or reliability as long as the product is cheap. People who can recognize the difference will pay for it- that number appears to be getting smaller and smaller. The the television displays a image or if noise comes out of a speaker that is all that matters to most people.
Bill Scorzo - 2009-20-2 13:18:00 EST -
I wonder who has the highest return rate, customer retunring the product and switching brand. Also how to they rank with service after the sale.
Dean Thompson - 2009-20-2 12:56:00 EST
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