DisplaySearch Study Reveals Consumers are Replacing TVs Faster than Ever

Affordable Flat Panel TVs Driving Quickening Replacement Cycle; New DisplaySearch Study Provides In-Depth TV Replacement Analysis by Region

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Santa Clara, California, April 21, 2011—Recent findings from the new DisplaySearch Global TV Replacement Study indicate that, in general, consumers around the globe are replacing both their flat panel and CRT TVs at a much faster rate than the previous 10-15 year average for CRT-to-CRT replacement. Studying TV replacement rates and the drivers of replacement or additional TV purchases is important in understanding the potential for future consumption.

“Digital broadcast transitions and more affordable flat panel TVs have caused consumers to replace their TVs, especially CRT models, in record numbers. By looking at how the pace of replacement is changing and what the drivers of replacement are, we can start to understand how future consumption might look,” noted Paul Gagnon, DisplaySearch Director of North America TV Market Research.

Gagnon added, “For example, if the installed base in a market was largely comprised of recently purchased TVs, and the replacement cycle wasn’t growing shorter fast enough, there could be a lull in demand coming. This is particularly true if TV makers are counting on new features like 3D to drive shorter cycles, but consumers aren’t interested in trading in a recently-purchased TV just to get a new feature.”

Recently-Purchased TVs Being Replaced in Emerging Markets

In more mature flat panel TV markets, like Japan or the US, it might be expected that relatively higher household discretionary spending can lead to quicker replacement of TVs, but DisplaySearch research indicates that this is not necessarily the case. Some of the recently-purchased TVs being replaced are found in emerging markets, like India, Indonesia and China, where the overall TV business is less mature because they generally adopted TVs at a later stage than advanced regions. Although they have a relatively young base of installed TVs to replace, the differences are pretty big. For example, Indonesian consumers are replacing TVs that are nearly half the average age of TVs being replaced in Japan. This also is happening during a time when significant eco-points incentives are being offered to entice Japanese consumers to upgrade, which they are using to swap out much older sets1.

Regional TV Replacement Trend Highlights

The DisplaySearch Global TV Replacement Study provides an overview of current TV profile and TV replacement trends by country, for example:

  • Indian consumers are mostly using very small CRT sets, although there is a surprisingly large number of flat panel TVs being replaced already, reflecting some social class distinctions.
  • This is quite different than households in Italy, where a large number of family members are under the same roof causing a greater incidence of TVs located in places like the dining room and kitchen, suggesting multiple primary viewing locations and the second-highest average number of TVs per household (behind the US).
  • Meanwhile, in Russia, a huge country, home sizes (often apartments) are small. As a result, the average TV size is much smaller than those found even in Japan.
  • Urban Chinese households have a surprisingly similar size profile to the US, reflecting the improved social status that owning a large TV brings.

Reasons Why Consumers Are Replacing Their TVs

Consumers around the globe replace their TVs for a variety of reasons. While the results vary by region, key findings included these highlights:

  • Consumers wanted a flat panel TV or HDTV, or often both. The decision to replace a TV was also very strongly linked to wanting a larger set with better picture quality.
  • The existing TV being outdated or broken was a strong driver TV replacement, but not one of the top reasons.
  • Interestingly, new advanced features, like internet connectivity and 3D are still very weak drivers for TV replacement, indicating that consumers aren’t going out to buy a new TV just because these features become available.
  • Price-related factors were important in TV replacement decisions.
  • TV brand trust was slightly more important than other reasons, except in Japan where it was very important. In the flat panel TV era, so many brands have emerged with a wide range of price points that price may be trumping brand selection. This, combined with the fact that leading brands have been aggressively matching low price competition levels the playing field, but downplays brand importance.

DisplaySearch Global TV Replacement Study Now Available

How quickly are consumers replacing their TVs? Which countries have the shortest replacement cycles? And what key factors are driving TV sales? The DisplaySearch Global TV Replacement Study offers a focused view of TV replacement trends in 14 global markets. This study also provides insight into why consumers are replacing their CRT and flat panel TVs. The report also helps businesses with important information:

  • Identify which markets are replacing and adding the most TVs… and why
  • Understand the TVs currently in the home, by technology, brand, size, age and location
  • Determine which devices, besides the TV, consumers are using to watch TV, movies and video such as iPads, smart phones, notebook PCs, and more
  • Identify how local TV replacement trends will impact product planning and the supply chain

The study also reveals planned TV purchases in the next 12 months.

  • The report is available for all 14 markets or by individual market:

China – Urban
China – Rural
India
Indonesia
Japan

UK
France
Turkey
Germany
Italy

Brazil
US
Mexico
Russia

This unique global study provides clients country-level insights and information based on nationally representative samples of more than 14,000 TV owners. The study combines DisplaySearch TV analyst expertise with the consumer survey design expertise of its parent company, The NPD Group.

For more information contact Charles Camaroto at 1.888.436.7673 or 1.516.625.2452, e-mail contact@displaysearch.com, or contact your regional DisplaySearch office in China, Japan, Korea or Taiwan for more information.

About DisplaySearch
Since 1996, DisplaySearch has been recognized as a leading global market research and consulting firm specializing in the display supply chain, as well as the emerging photovoltaic/solar cell industries. DisplaySearch provides trend information, forecasts and analyses developed by a global team of experienced analysts with extensive industry knowledge. In collaboration with the NPD Group, its parent company, DisplaySearch uniquely offers a true end-to-end view of the display supply chain from materials and components to shipments of electronic devices with displays to sales of major consumer and commercial channels. For more information on DisplaySearch analysts, reports and industry events, visit us at http://www.displaysearch.com/. Read our blog at http://www.displaysearchblog.com/ and follow us on Twitter at @DisplaySearch.

About The NPD Group, Inc.
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,800 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us or visit http://www.npd.com/ and http://www.npdgroupblog.com/. Follow us on Twitter at @npdtech and @npdgroup.

1. These incentives are in the form of the Eco-Points program, which is now coming to an end.

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