Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now


Luxury Audio Is Another World And Different Rules Apply

Editor’s note: On the heels of TWICE Magazine’s Luxury Issue, we asked our friends at Futuresource Consulting to identify what sector of the tech business is ripe for expansion at the very high-end of the market.

McIntosh, Krell, Martin Logan and Wilson Audio are among those brands that operate in the rarefied $400 million business of luxury audio in the U.S., where individual components can cost anything from $5,000 to $50,000 or more. Owners of this type of kit are either millionaires or passionate audiophiles — often both.

More than half of sales come via the custom-install channel, which itself is benefiting from the continued recovery of new-home building in the wake of the economic crash of 2008. Virtually all other sales are transacted through high street specialist dealers, but these are becoming scarce and the biggest issue facing the industry is how to introduce potential buyers to the fabulous sound that luxury products offer. Beyond sound quality, these are aspirational products where ownership is a badge of success, like owning a Lamborghini or Bentley. Brand heritage, where and how the products are made, their look and feel are all especially important.

See also: 10 High Fliers In The Luxury CE Market

Technical innovations such as immersive sound (Atmos, DTS:X and Auro), 4K pass-through and high-resolution audio are all fuelling growth, and the recovery in vinyl listening has also inspired more investment in stereo set-ups. This is a lucrative world, where wired solutions remain essential, change happens slowly and channel relationships are key. But change is afoot. Samsung has bought Harman (owner of the Mark Levinson brand) while Eva Automation has acquired B&W, emphasising the link increasingly made between audio and the smart home.

This thriving sector of luxury audio is one to watch.

Jack Wetherill is a senior market analyst at Futuresource Consulting