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NPD: Internet Small Appliance Prices Higher Than Brick And Mortar

The NPD Group today reported that US sales of small kitchen appliances grew 15%, to $2.5 billion, in the first half of 2013 compared to the same time period one year ago.

“The small kitchen appliance industry continues to reap the rewards from product innovation in specialty appliances, nutrition and diet trends, and the consumers’ desire to replicate away-from-home in the home,” said Debra Mednick, executive director and home industry analyst, The NPD Group, Inc. “The spending that is occurring on premium products provides an added boost to the industry.”

Online sales accounted for 19% of small kitchen appliance dollars in the first six months of 2013, a 23% increase over the first half of 2012. Brick-and-mortar store sales also increased during this period, experiencing an increase of 8%.

The average amount spent on a small kitchen appliance purchased online decreased 4%, while the average amount spent in a retail store increased 5%. Consumers, however, are still spending an average of 34% more when they buy these products online.

“As the online channel continues to grow in size and impact, the growth comes with new challenges for marketers. Balancing the virtual with the brick-and-mortar demands attention in order to be positioned as an opportunity,” said Mednick.

More than four in ten small kitchen appliance sales during the first half of 2013 were made by first-time purchasers. Growth from these new consumers is outpacing the total market. More importantly, most of the industry gains can be attributed to increased incidence of first-time purchasers.

“Consumers looking for their first appliance purchase tend to have the luxury of time to educate themselves through research, an activity that is not as common among consumers looking for replacement items,” said Mednick. “For first-time purchasers, a key benefit of the online channel is the opportunity to use that added time and attention to inform them of the features and benefits, which in turn can motivate them to buy a premium product.”