New TV Technologies
TV is a major contributor to the upgrade trend, Holzer added, citing the lunch of Ultra HD TVs, OLED TVs, and the proliferation of larger and larger screen sizes.
And that’s having a downstream ripple effect in audio, encouraging people to trade up their home theater’s audio system to match the performance of their new TVs, he and other marketers said.
“Ultra HD is bringing back the premium customer,” Dennis Holzer, executive director of the PowerHouse Alliance said, as are the growing sizes of flat-panel displays. “Before there were 60- and 70-inch TVs, and no one rushed to replace a 55-inch TV, but now there are 70-, 80- and 90-inch TVs. Ten to 20 inches more gives you something to upgrade to.”
ProSource president/CEO David Workman agreed that TVs are giving installers a lift. “The premium-TV customer is back in the market,” and they tend upgrade the rest of their home theater system, he said. “TV drives a lot of other products.”
Perhaps the fastest growth is occurring in home automation. That’s what Jim Annes, AVAD’s VP/general manager, sees, and though the growth is from a smaller base, he said, “I don’t see it slowing down.”
The acceleration started about two to three years ago and includes HVAC, lights and IP surveillance. “But it really picked up in the past year because the custom channel knows it’s here to stay,” Annes said. Consumers are asking for home-automation solutions in part because of DIY-product sales growth and “just knowledge in general,” he said.
The growing intelligence of home-automation systems is also driving consumer adoption, Annes said. Consumers no longer need to press a button to do something because now an installed home system anticipates needs and dooes it for them, he said.
Although home-automation products can now be bought at Lowe’s and Home Depot and installed by do-it-yourselfers, DIY growth hasn’t harmed the custom business and in fact is aiding it, marketers contended.
The rise of DIY home-automation products “is creating an incredibly larger addressable market that you can go after in a value-added way,” Annes said.
Most DIY automation systems, he said, are standalone systems that work independently of other systems with an app for each specific vendor or product. These systems “create a bigger total addressable market for installers who show consumers introduced to home automation through these products how they can unify systems and create a better overall experience,” he said.
Continued gains in housing starts is also lifting custom sales, with single-family starts picking up in the first half at 11.3 percent from 2.2 percent in the first half of 2014, Census Bureau statistics show. But the new-home construction business is helping lift custom sales more than the statistics indicate.
“The price-point homes that matter to us are doing fine,” said Workman. Housing starts “are missing at the low end.”