CHICAGO, June 10, 2024 (GLOBE NEWSWIRE) -- New research from Circana™, a leading advisor on the complexity of consumer behavior, has revealed that overall TV category sales remain stagnant as consumers continue to prioritize value. Despite this cautious approach to spending, there has been an uptick in purchases of ultra-large TVs.
The positive growth in TVs with screens 75 inches and larger can be attributed to a surge in deep discounts that began in the second half of 2023. The average screen size grew by 0.8 inches (2%) in the first four months of 2024, reflecting the continued consumer preference for larger screens. While sales of ultra-large TVs increased by 21% year-over-year in Q1 2024, revenue grew by only 4% due to ongoing markdowns.
“The strong growth trend for ultra-large TVs aligns with the increase in 65-inch TV sales from 2018 to 2020, which consumers are now starting to replace five to six years later, in line with what our research suggests is the most common replacement interval,” said Paul Gagnon, vice president and industry advisor, Consumer Technology, Circana. “We expect this trend to persist as upgrade activity continues into 2025 and beyond. However, as cost compression slows, shifting away from price-driven growth strategies will be crucial to sustain continued expansion.”
Overall, price sensitivity among consumers remains high, leading many to opt for lower-priced brands to maximize savings. In 2023, dollars fell 11% as consumers pivoted to purchasing lower-priced TVs. While TV demand has been soft in early 2024, with total unit demand down 1% and revenue down 6% in the first four months of the year, there is optimism for recovery later in 2024, continuing into 2025 and 2026. This anticipated rebound will be driven by consumers continuing to replace TVs following the surge in demand during the early pandemic, coupled with the evolving landscape of smart TV operating systems.
Circana’s Connected Intelligence TV Ownership Survey reveals a shortening TV replacement cycle, highlighting the critical timing of these replacements. Increasingly, consumers are replacing TVs due to broken or outdated models. This trend presents new avenues for monetization through targeted advertising for TV brands, smart TV platform companies, and retailers.
“While upgrading to a larger screen size is still the primary driver of replacements, upgrading outdated smart TVs will also be a key driver of future demand growth,” added Gagnon. “Particularly significant for value-priced TVs, the replacement trend and likely smart TV growth presents an opportunity for manufacturers and retailers to offset narrow profit margins of hardware sales with revenue from advertising and other connected TV-related revenue streams.”
About Circana
Circana is the leading advisor on the complexity of consumer behavior. Through unparalleled technology, advanced analytics, cross-industry data, and deep expertise, we provide clarity that helps almost 7,000 of the world’s leading brands and retailers take action and unlock business growth. We understand more about the complete consumer, the complete store, and the complete wallet so our clients can go beyond the data to apply insights, ignite innovation, meet consumer demand, and outpace the competition. Learn more at circana.com.
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Janine Marshall
janine.marshall@circana.com
Janine Marshall Circana 1-516-625-2356 janine.marshall@circana.com
