Early MP3 Head Unit Sales Range From Hot To Cold

With a broad assortment of new MP3 head units hitting store shelves, early reports say that the category is meeting with mild success.

Retailer reports on sales were all over the map, ranging from Crutchfield, which says sales are very hot, to Tweeter, Etc., which estimates MP3 sales at 4 percent of its head-unit sales in recent weeks, to several car audio chains that said sales were "minimal."

Among the strongest proponents for MP3 is Crutchfield, Charlottesville, Va., which is carrying 10 models. "I would characterize MP3 as the fastest growing segment of in-dash receivers ever, in our case. I've never seen a product take off this quickly. The most popular is a $300 model," said senior VP of merchandising Dan Hodgson. The catalog/e-commerce Web site said it carries Aiwa, Jensen, JVC, Kenwood, Panasonic, Rockford Fosgate and Sony.

Car Toys, Seattle, says it's selling five or six MP3 units per month per store and expects the category to take off. The company just announced that it will begin selling the SONICBlue Rio Car line of hard drive-based MP3 players (see story below) and that it is also picking up Jensen and Aiwa models.

"We're doing very well with the Kenwood KDC MP8017 at $359. It seems to be leading the pack," said audio buyer Chris Burch. For MP3 unit sales overall, "it's about where we thought it would be for right now," he said. "We anticipate a lot more movement once we fill out the mix and we'll be getting behind it very aggressively and promoting Car Toys as the place to go for MP3."

Action Electronics, Newington, Conn., says that the Sony CDX MP450X at $399 is its best-selling unit. The store carries MP3 units from Aiwa, JVC and RF. "We've been selling about three or four a week of the Sony model alone," said owner Mark Gebeloff, noting that the store sells a total of about 60 head units per week.

Tweeter, Etc., Canton, Mass., said MP3 is selling very well and cited the Kenwood KDCMP8017 at $359 as its best seller. Buyer Marc Spatz estimates that MP3 is currently 4 percent of head unit sales.

An equal number of retailers, however, characterized MP3 sales as soft.

Al & Ed's, Monterey Park, Calif., and Boomer McCloud, Newington, Conn., said MP3 sales were minimal at present.

"It's not selling well right now. However, it's a fresh category and we all have great hopes for it. We don't think its going away regardless of what happens with Napster. It will be with us for a while," said John Haynes, purchasing manager for Al & Ed's.

Manager Michael Scaturro of Car Tunes in Wilkes-Barre, Penn., noted, "Right now people are asking about them, but they are not really selling like hotcakes. They are a little more high priced than regular decks and the price makes people back off. A few people are buying and I'm sure it will take eventually off," he said

A few retailers said that sales may pick up after the new products have been on the shelves a bit longer, with some noting that Alpine and Clarion models have not yet shipped. In addition, many said that salesmen still require training in MP3.

"The younger kids are educated on computers a lot better than the sales guys and the salesmen have to get up to speed," said Rick Foster, store manager for Auto Air and Audio in Springfield, Mo.

Car Toys' Burch added that salesmen must be educated on how to transfer files from a computer to CD. "Some of our customers have never owned a CD player, they have all their music on the computer so the salesman has to be able to say 'here's how it gets transferred, you can use the files on your portable device and burn them onto CDs.'"

Midway Car Center, Lowell, Mass., carries the Sony Mobile ES and Kenwood Excelon models and said they are selling "moderately" according to general manager Phil Chartier.

Soundcrafters, South Daytona, Fla., said it sells between 3 and 6 units a month compared to 100 to 150 head units overall, but noted that sales have been "picking up in the last few months," according to AV specialist Daniel Levine.