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Public Alert Radios Seeking Gains

8/22/2005 02:00:00 AM Eastern

Suppliers of Public Alert-certified radios are pursing traditional consumer electronics retailers and general merchandise chains to drive sales, but some of the companies have also targeted nontraditional venues such as hardware stores, grocery chains and government agencies to kick-start the market.

The companies are also looking to the federal government and CEA to promote the technology to consumers as part of National Preparedness Month in September.

Public Alert-certified radios meet voluntary performance standards finalized in December 2003 by the Consumer Electronics Association (CEA) at the request of the National Weather Service (NWS) and the National Oceanic and Atmospheric Administration (NOAA).

Earlier that year, NOAA expanded the mission of its national network of NOAA Weather Radio (NWR) stations to alert citizens to about 80 other threats, including biological, radiological and chemical hazards; civil emergencies; and contagious diseases (see story below).

The first models to be certified by an alliance of government agencies and the CEA were launched in the second half of 2004 by RadioShack, First Alert and Midland. Oregon Scientific will join them in short order. Current models have suggested retail prices ranging from about $24.95 to $99.95 and include battery-operated portables and AC-powered tabletop models with AM/FM and battery backup.

Suppliers Midland and SIMA, which markets First Alert-brand models, expect strong growth in certified and uncertified all-hazard radios in 2005, but they note that the market's potential is still largely untapped.

“Thirteen percent of households own stand-alone weather alert radios,” said Midland's sales and marketing VP Charlie Speights, “but 95 percent of the population has coverage.”

SIMA's sales and marketing VP Doug Marrison acknowledged that Public Alert radios are “a challenging sell” because retailers must be convinced that the devices will sell through everyday and that sell-through won't be limited only to areas threatened frequently by hurricanes, tornadoes or floods.

Nonetheless, terrorism and the recent hurricane season have raised consumer awareness of the products, Marrison said, citing a September 2004 consumer survey conducted by CEA. The association found that almost half of the surveyed adults were aware that consumer electronics devices could be “equipped to receive automated alerts from government authorities,” he said.

Consumer interest in owning such a device is high, he added. Thirty percent of the adults surveyed were “very interested” in owning a Public Alert device, and another 35 percent were “somewhat interested.”

Interest is up at least in part because the Department of Homeland Security “has raised consumer awareness about home safety and emergency preparedness” through the Ad Council's Be Ready ad campaign, Marrison continued. Since February 2003, more than 210 million people have seen or read ads worth $310 million in donated space, he said. The department's Web site has been hit more than 1.8 billion times, and more than 3.6 million brochures have been downloaded or requested, he added.

For their part, CEA and 160 other corporations and associations are co-sponsoring the second annual National Preparedness Month in September. The nationwide effort will include events and activities designed to encourage citizens to prepare for emergencies occurring when they are at home, school or work. The initiative launches on Sept. 1 with an event in Washington's Union Station.

During the month, CEA will promote the Public Alert concept to members through its newsletters. CEA's plans for a public relations campaign will be finalized in September or October.

However effective the campaign, quantifying its impact on industrywide sales will be difficult because no association or research company tracks sales of traditional weather radios, let alone certified Public Alert models. Marrison, however, estimates weather radios have achieved unit volumes of 300,000 to 500,000 per year in recent years and forecasts Public Alert radios sales will exceed that volume by two to three times.

Expanded distribution channels would help the industry achieve those goals.

SIMA's brick-and-mortar distribution successes, for example, have largely been in regional grocery and drugstore chains as well as the True Value hardware cooperative. SIMA also sells through Amazon.com, Target.com and BestBuy.com. Recently it began selling through all of Kmart's Southeast stores and through the Southeast stores of grocery chain Winn-Dixie. And in August, it went on the air at QVC.

SIMA is also targeting direct sales to state and local governments and successfully bid for contracts to supply Public Alert radios to schools and municipal buildings in North Carolina. Home centers and consumer electronics retailers are also in SIMA's sites.

Midland's Public Alert radios are sold primarily through Wal-Mart and Best Buy, but its products are also sold through select regional grocery chains such as Price Choppers in Missouri.

RadioShack-branded models are sold throughout the chain, but the company noted that sales are strongest in the Southeast and in the Midwest, where sever weather events are more frequent. Sales spike up following hurricanes and tornadoes, the company noted.

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