Room For Growth Still Seen In Teeming Headphones Market - Twice

Room For Growth Still Seen In Teeming Headphones Market

Author:
Publish date:

NEW YORK — The headphones market is more crowded than ever, and with good reason: U.S. consumers spent more than $2.3 billion on stereo headphones in 2013, which is up 11 percent from the year before, according to The NPD Group.

Elbowing for consumer attention is a challenge, and TWICE corresponded with executives from three out of the five top-selling headphones manufacturers (as per NPD) on just how they accomplish this feat and some of their plans for the near future.

What follows are the emailed responses to questions submitted by TWICE on the state of the headphones market. For more on NPD’s findings.

TWICE:We all know this category exploded several years ago. Do you see the headphones market as one that’s more crowded than ever, or are consumers and retailers beginning to thin out the choices?

Hoby Darling, Skullcandy CEO: Headphones are now part of the uniform of youth. Our 20-yearold constantly connected influencer customer is tied to his phone and tablet for many types of mobile entertainment and communication. I only see this accelerating.

However, I do believe that retailers are consolidating down to their top four to five headphone brands that have shown a combination of strong sell-through, authenticity to the category and the potential to drive long-term excitement and innovation. The growth of the smartphone and tablet market has also meant huge upside for industry given the obvious attachment headphones/earphones have with these devices.

Joe Palmieri, general manager, headphone division, consumer A/V group, JVC Americas: It’s definitely more crowded than ever, and I think consumers are confused by so many different headphones within the same price points. The number of brands has exploded, and there are now so many off-brands that boast the same quality as the brands consumers have grown to know. It’s the major brands’ job to offer the highest quality products while commanding a fair price for the quality that consumers expect from known brands.

Takumi Sasaki, director for headphones, mobile, home entertainment and sound, Sony Electronics: The headphones market has always been a very competitive space, but as you have noted, we have seen explosive growth within the last five years. ... Within the coming years, we do not expect to see the same level of growth as we have in the past, and both consumers and retailers are starting to become more selective.

TWICE: What are some of the biggest challenges in attracting consumers?

Darling: Consumers expect more today than ever before. While at first this might seem like a challenge, we see this as a massive opportunity because of the unmatched performance we can deliver due to recent investments in our in-house advanced concepts engineering and product teams combined with our authentic lifestyle and brand ambassadors across music, art, film, sport and youth culture.

Palmieri: Marketing has become a huge challenge today, with consumers constantly bombarded from every angle by product manufacturers fighting for impressions. Quality impressions take time to build, and I believe that quality and longterm plans will always prevail. With so much competition in the marketplace, it’s easy to lose focus, and a challenge to be patient. Meeting the long term goal is not always an easy task.

TWICE: Do you believe there is a growing movement toward the importance and benefits of high-resolution audio? If so, what kind of an effect will this have on headphones?

Darling: Sound performance has to be great. This is something we have concentrated on very hard in the recent past to ensure we have as good of sound curve and performance as our more expensive competitors. ... At the same time, what I believe will be more disruptive and game changing are innovations that significantly enhance how consumers experience their audio entertainment.

Palmieri: High-resolution audio is getting a big push this year, and there seems to be growing support for it. But I think its effect on the headphone category will be limited to the upper end of the market, especially in the near-term. That said, I’d argue that there are plenty of moderately priced headphones available today that can do a fine job of handing high resolution audio. But I don’t see any significant shifts happening this year in the headphone market as a consequence of high-resolution audio. There will be some consumers who will jump on it and feel that they need to move up to a higher-end headphone to get the most out of the high resolution formats, but that will be a small part of the market for some time.

Sasaki: Sony is part of a group of organizations that believe in the importance of high-resolution audio. Although the proliferation of digital music has been great for the industry, it has also had the unfortunate consequence of creating a user base that is accustomed to lower-quality music files. ... Additionally, we also see a growing segment of “music enthusiasts” who would not necessarily classify themselves as “audiophiles” but appreciate great sound. Many of these enthusiasts have also been waiting for better quality music to be available in a portable format. ... We believe that as high-resolution becomes more mainstream, this customer base will grow.

TWICE:What are your thoughts on listening stations in retailers? Useful?

Palmieri: Listening stations are a necessary evil, and all manufacturers would like to have their display up in all retail segments. Unfortunately, there’s not always enough space on the floor to demonstrate all products. Retailers generally go with the big names for demonstration, although from a retailer’s point of view, sales in the small- to medium-sized brands would benefit much more from providing these displays. Many of these top-tier products backed by a celebrity DJ are sold before the customer even gets to the store. It’s the brands that aren’t as well known where a demo would benefit our retailers the most in growing their overall business.

Featured

Related Articles