Mobile Multimedia Volume Is Turning Way Up
By Amy Gilroy -- TWICE, 7/10/2000
Mobile multimedia continues to be the shining star of car electronics this summer, now capturing 25-50 percent of sales at some specialists, and driving car audio upgrades as well, according to a TWICE poll.
Sensuous Sounds, Tampa, Fla., said car video is currently up to 50 percent of car audio sales.
Tweeter etc., Canton, Mass., said multimedia is only 10 percent of sales but should quickly rise. Mobile electronics buyer Marc Spatz said, "I'd like it to double. Where I think it will go over the next few years will be about 50 percent."
Larry Wein, VP/general manager of Al & Ed's Autosound, Monterey Park, Calif., said car video is "in double-digit growth" and claims that the surge in video is also bolstering car audio.
"Typically, what happens is you sell a video system and then sell a ton of audio with it -- amplifiers, subs, satellite speakers and full-on audio systems to drive all the benefits of Dolby Digital," said Wein. "Our car audio sales are up 20 percent. A large part of that is due to video."
Suppliers are also seeing staggering growth. Alpine marketing VP Stephen Witt, for example, said, "Already in the first quarter of 2000 we've seen a shift to multimedia. Twenty-five percent of our sales are now in multimedia, driven primarily by navigation and DVD video. We're expecting that by 2001 mobile multimedia will exceed 40 percent of our sales mix."
Audio is also gaining as a result, he added. "It's pulling additional audio product sales. We have seen an increase in multichannel amplifiers and subwoofers."
Steve Medeiros, owner of Sound FX in West Warwick, R.I., said: "If it weren't for video, it would be very scary out there. Video has gone from nothing in one-and-a-half years to 20 to 25 percent of our business -- and you're talking huge dollars. Margins are generally 30 to 35 points. It translates to other sales because guys doing video will do navigation because now they have the screen. Or they'll do surround sound, which translates to amp sales. Then, if you're going to do all that, they will go for an alarm."
Other independent and regional stores are seeing less dramatic sales, or just now beginning to push mobile video. Stores reporting a more moderate video sales share include Soundcrafters, South Daytona, Fla., and Car Connection, Waterbury, Conn., at 1 percent of car electronics sales; and Action Electronics, Newington, Conn., and Discount Autosound, Virginia Beach, Va., at 15 percent.
Audiovox maintained that although video still has a small penetration in the car electronics market, its growth potential is huge.
"Mobile Video is still in its infancy," said mobile electronics VP Tom Malone. "It's high dollars, so it looks good on paper. What we are encouraged by is how we're doing at this stage when so few consumers know about it. So the potential is what is really exciting for us.
"The thing that will help drive it now is the retailers getting into it -- not just the car dealers -- because the retailers are going to promote it, and consumer awareness will go up."
Malone also explained that "solutions are starting to vary. What started out as these hybrid expensive custom-installed screens now are down to three main types of systems: overhead drop-down system; a seat-back installation; and now we and others are doing headrest installation kits, so you don't need a guy who has been doing leather work for 20 years to install it."
Alpine's Witt said a sign of strong growth is that the high-end video market is broadening beyond SUVs. "We're starting to see it move into big luxury cars like the S Class Mercedes and BMW 7 series," he said. "This is, quite frankly, very interesting. A year ago it was primarily only in SUVs."
Clarion director of product planning Jack DeBasio said he can see video "becoming 50 percent of specialists' sales if you include the audio upgrades, and we're seeing that in our audio sales. I would say in almost every case of doing passenger video, it's adding opportunities for audio, either wireless headphones, or speakers and amps."
Another encouraging trend is the increase in multiple monitor installations. Paul Papadeas, owner of Soundcrafters, and others claim multiple monitor installations are becoming more popular among affluent customers.
"We're seeing more multiple monitor installations," Papadeas said. "The client for this is the guy with a mega-system who wants to expand it with TVs in the headrest and flip-down panels from the ceiling. It's the money-is-no-object customers. We're averaging one or two a month."
Similarly, Martin Veirow, a store manager for Jodi's in Orange, Conn., said, "More and more cars are getting multiple screens. We're doing a car right now with a screen in the visors and two in the headrests and one in the center off an Alpine DVD player. This is getting more and more common."
Audiovox claims its screen sales vs. drop-down pods have increased tenfold over the past year, indicating the use of multiple screens per installation, Malone said.
Overall, the mobile multimedia market appears to be polarizing into two distinct markets, said several suppliers and retailers. Alpine's Witt defines the two factions as either the budget-conscious portable VCP or floor-mount system, or an expensive system with DVD and headrest screens, which is often accompanied by audio upgrades.
Clarion's DeBasio agreed and said he also sees it "as two segments - one is rear-seat entertainment based on the passengers' needs, which is typically monitors that mount in the back, and the second segment is dashboard-mounted product for the driver, where he listens to audio and views the screen for information such as navigation.
"The rear-seat entertainment typically goes into SUVs and minivans, where the systems for the driver are going into the mid- and high-end sedans."
No related content found.
VIEW ALL GALLERIES