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The Tide Is Rising For Marine Audio

5/03/2004 02:00:00 AM Eastern

Marine audio sales are showing signs of growth as boat suppliers, like car companies, look to premium sound systems to help boost sales.

The National Marine Manufacturer's Association (NMMA) estimates there are 12 million registered boats in the United States, from kayaks to yachts. Dollar sales for boats large enough to offer sound systems were down in 2003 by 3 percent to $6.5 billion, but sales rose considerably in the second half, leading the NMMA to predict healthy growth in 2004.

Audio sales for boats comprise a small niche but one that may be growing. Marine audio sales are estimated at $100 million annually for both OEM and aftermarket sales, according to Todd Allen, sales and marketing VP for Prospec Electronics, a marine audio manufacturer/distributor, based in Mt. Pleasant, S.C., that works with brands such as JBL. Allen estimates approximately 150,000 to 200,000 boats are sold annually with a marine audio system.

Just how fast marine audio sales are growing is up for debate. Most car stereo suppliers and marine audio distributors say that the boat companies are increasingly looking for higher-end sound systems to help sell boats. In addition, they are looking for better quality systems that stand up to marine environments. The problem is that the boat companies are not yet willing to pay more for these systems.

Speaking of one boat builder, he said that, "They don't want to spend an extra $10 per speaker to get the JBL upgrade. They say they can't hide an extra $40 in the cost of a $15,000 boat. But they are using the JBL head units. These guys want to give the perception of having a high-end system but then they use less-expensive speakers."

Unlike the automotive market, where car companies may buy direct from car audio suppliers, boat suppliers purchase through marine equipment distributors such as Prospec and Marine Audio in Ellisville, Mo. Both companies said there is a great need for industry and consumer education about the value of premium marine audio systems.

The tide of awareness, however, is beginning to turn.

MB Quart claims its OE marine audio sales to boat distributors spiked last year. "Until now, most boats, even the $200,000 models, came with $39 coaxial speakers. So we saw an opportunity," said Brain Sherman, marketing manager for mobile brands at Rockford Corp., which owns MB Quart, adding, "Boat manufacturers are beginning to see the benefit of branding the speakers in a boat." As a result, Rockford came out with a line of marine audio products for the first time under the Rockford brand and showed them at CES in January.

JBL and Infinity say their marine audio businesses are growing monthly, and Infinity is introducing this month one of the first wakeboard sound systems.

Wakeboarding is a sport that is basically waterskiing on a wide single ski and riding (flipping, jumping, etc.) over the waves left by the wake of the boat. The NMMA spokesman calls it the "snowboarding of waterskiing." Wakeboard boats are essentially powerboats with a special tower to attach a ski rope. The tower can also serve as a baffle for a stereo system.

Infinity's new Wakeboard Tower Audio System includes two 6000M 6-inch mid-woofers with 1-inch dome tweeters that are encased in injection-molded polymer that is resistant to UV rays, salt and water damage, said the company. The speakers deliver 90dB to a distance of 50 feet. Also included is a 150-watt-per-channel amplifier with a microphone so users can communicate with the wakeboarder. The system ships this month at $1,099.95.

Allen said that only about 30,000 wakeboard/power boats are sold annually but that the wakeboard demographic is the most likely to want to upgrade a sound system.

"He's a Gen-X or -Yer. He, or his parents, have spent at least $30,000, and on average $50,000, for a powerboat, so he has money. He is the guy who is more likely to bring in his boat and get hooked up with a $3,000 to $5,000 upgraded stereo system. And then there's the guy with a 5- to 8-year-old Sea Ray, whose radio stopped working and he'll go to a dealer to get a new one," Allen said.

It's also important to understand that "a boat is basically a party vehicle. And the point is to have a good time. So people want to have a music system," said an NMMA spokesman. In addition, he claimed, "There's a trend of people getting into boating because it's relaxing and it's a family activity. Ninety percent of Americans live an hour or less from a body of water, so it's a vacation."

John Prunty, GM for distributor Marine Audio, which works with Clarion and Pioneer, says the new interest in premium sound systems is due in part to many years of educating boat builders by the distributors. Another catalyst, said Prunty, is a J.D. Power & Associates study initiated three years ago on boating customer satisfaction, which ranks marine audio systems.

Eric Sorensen, director of marine audio for J.D. Power, said satisfaction levels in boat sound systems are low. Looking at "runabout" boats — typical family powerboats approximately 20 feet long — customer satisfaction with the "ability to hear the stereo at cruising speed" was "one of the worst stories in the whole study," Sorensen said. Sound clarity at high volume, the ability to hear the stereo at cruising speed and speaker placement were the three most important aspects of the sound system, according to boaters, and all three received very low ratings in satisfaction over all three years of the study, Sorensen said.

According to Marine Audio's Prunty, part of the problem lies in the fact that many car audio suppliers fail to recognize some of the realities of the marine environment. "There may be splash kits to cover a unit, but that's created some reliability problems. The boat builders are now becoming a lot more discerning about the equipment they use. In the last year, we've seen the emergence of true marine products, such as head units, that can be hosed down and still perform — also displays that can be read in direct sunlight, and use of materials resistant to UV rays without discoloring or cracking."

Keith Lehmann, Kenwood mobile electronics sales VP, said, "Marine-quality audio products that can be heard over engine noise and that are profitable to suppliers are an elusive but achievable goal. We think the marine product gets better and better each year, and demand for good sound in a boat is gaining and not subsiding. It's possible, profitable and feasible to build true marine products," he said, noting that Kenwood is planning to expand its marine offerings.

Just what does this trend mean for 12-volt retailers? A quick survey found that many dabble in the category, although most were not convinced it is a growth segment.

Best Buy offers products on its Web site, claiming sales are meeting expectations. It currently carries Dual-brand products and will be adding Rockford products this spring. Tweeter carries Clarion marine products.

Crutchfield offers a few Kenwood marine products. "Its not currently a big market," said Dan Hodgson, senior merchandising VP. The Charlottesville, Va.-based catalog used to offer a marine stereo section, "but we never really saw the business develop."