TWICE Staff On Dec 17 2012 - 1:00am

Growth Segments

TWICE: Which product segments gained in 2012, and what is the outlook for 2013?

Anderson: As expected, Alpine saw growth in two-DIN A/V and AVN products, but we’ve also seen growth in our amplifier and speaker businesses as well.

Lehmann: Audio add-on solutions, such as amplifiers and speakers, have taken on a new importance as dealers find ways to upgrade factory audio systems with integrated in-dash electronics that customers are unwilling to replace. The in-dash CD category remains very relevant due to a replacement market being driven by customers with older, reliable vehicles. Multimedia models have reached even lower price points, making them attractive to customers who would have otherwise opted for premium in-dash CD. These trends will continue into 2013.

Braun: Among the aftermarket A/V categories in which we compete, both single- and double-DIN in-dash multimedia units have been steadily growing in 2012 and will continue to grow in 2013. Factory-look-alike units have grown in popularity as well, but this is still a smaller niche in the overall aftermarket business.

Gharapetian: Based on retail unit sales, we expect 2012 in-dash A/V centers (monitors with DVD/CD) will have shown a 6 percent gain in 2012 compared with 2011 while in-dash navigation systems will have experienced a slight decline. Speaker sales were unchanged, with amp units declining by 5 percent. Source unit sales also remained mostly unchanged from 2011 to 2012 while mech-less category growth was significant from 2011 to 2012 at 35 percent, although volume still remained small. The outlook for 2013 is similar, with expected growth of in-dash A/V centers and mech-less units as they gain more features and capabilities.

Rougas: Source units continue to show the most strength as consumers look to add the latest technology and media solutions to their existing vehicle. Also, as we bring more apps into the car, we are starting to see an increase in sound upgrades as more and more music apps are offering increased bit rates for better sound quality. This now allows our dealers to offer consumers a better sound system by not only being able to replace their head unit but also speakers, subs and amplifiers as needed.

TWICE: What features or technologies were in highest demand in 2012, and what do you expect for 2013?

Anderson: Bluetooth streaming head units, by far, are the most requested items. People want to listen to the music content residing on their phone while driving.

Lehmann: There are features that are very popular in certain areas of the country. However, Bluetooth seems to be the overall winner with the mobile electronics customer. Wireless audio streaming and wireless control of media devices are now just as important as hands-free operation. With the ongoing penetration of the Android smartphone platform, dealers must be prepared to demonstrate connectivity features on any phone someone brings into the store.

Braun: Internet radio streaming has become quite popular this year, and that trend will continue in 2013. Anyone with a smartphone data plan and a proper connection to the car radio can stream music from an Internet source to their car radio. However, those head units that provide control of Internet radio services from the touchscreen or console offer an additional advantage to consumers. Bluetooth (hands-free and streaming) has continued its growth in popularity, and usage and will continue as well in 2013.

Gharapetian: We expect app radios to become more popular in 2013 as more models become available and consumers gain more exposure to them. We also believe that any type of connected system (depending on execution and usability) will be popular as people would continue to bring their smartphones into their vehicles with the intention of not just using their phone function but using the content stored in their phones, including the apps, music and other multimedia content residing on their phones. In the U.S., HD and satellite radio remain popular, as well as music streaming via Pandora, iHeartRadio and/or other direct access apps.

Rougas: Consumer demand for smartphone connectivity products designed for the car continues to index high, both for media playback and smartphone app interface and control. In 2013, we expect to see more uniform interface solutions and increased awareness from both the retailer and consumer.