Positive Signs Support Home Entertainment Sales

NEW YORK— The prospects for furniture associated with electronics looks positive for the year ahead, according to the results of the Home Entertainment Furniture Report survey conducted for HOMEWORLD BUSINESS® by The AIMsights Group.

Not only are more consumers interested in purchasing electronics in the year ahead, some critical categories are proving more popular this year than was the case when the study was conducted a year earlier, including flat panel televisions and personal computers.

In addition, the study determined that consumers continue to consider purchasing furniture associated with home entertainment and often in greater proportions. The advantage there for furniture manufacturers and retailers is that ready-to-assemble furniture associated with electronics is rather than a planned purchase. In addition, by looking at how lifestyle and furniture purchasing affect one another, the study determined that consumers are increasingly interested in furnishings that can be employed in home entertainment occasions.

A significantly larger proportion of consumers responding to the survey this year, which was conducted in the fall, is looking to buy electronics compared with last year. In fact 38.6% of survey respondents said they definitely and 31.9% said they would very likely do such purchasing over the course of the year ahead versus 33.8% and 23.6% in the survey conducted last year.

Smartphones remained the top consumer choice among consumer electronic devices, and more so this year. Just under 70% of consumers surveyed identify a smartphone as their number one purchase priority among electronics devices versus 55.3% a year ago.

Televisions followed, coveted by 55.8% of study participants, up from 41.6% a year ago. The preference for laptops, tablet computers and gaming consoles, were down somewhat year over year, but the demand for personal computers was up to 23.3% from 20.8%, demand for personal gaming devices was up to 13.9% from 11.7% and demand for audio components was up to 23.6% from 13.5% year over year. Laptops, the second highest purchase priority in the 2015 survey, coveted by 49.4% respondents, fell to third place in this year’s version, cited by 47.2% of participants.

As for purchasing furniture, consumers who intend to buy electronics are not quite as keen as they were last year to purchase something to house it in, with 11.5% saying they definitely would and 17.4% saying they very likely would. In last year’s survey, 16.4% of respondents said they would definitely purchase furniture to house new electronics and 17.1% said they would very likely do so.

However, a lot of consumers are on the fence, with 39.2% saying they are somewhat likely to buy furniture in conjunction with their electronics purchase as opposed to 30% last year. Only about a quarter of consumers surveyed this year said they definitely or very likely would purchase compatible furniture from the store where they purchased electronics versus just under a third in the study conducted last year, perhaps reflecting the influence of e-commerce. However the proportion of true naysayers declined year over year with the number declaring they were not at all likely to purchase from the store that sold them electronics down to 32.7% from 36.9%.

In terms of what they might be willing to pay, consumers came off the lowest price ranges in the latest study, with 13.6% saying they would pay less than $50 this year versus 18.2% last year and 12.4% saying they would pay $51 to $100 this year versus 16.4% last year. More said they would pay $101 to $150, at 18% versus 15.3% year over year, which turns out to be something of a sweet spot because fewer want to pay from $151 to $250 for electronics compatible furniture, at 19.5% versus 21.3% in the 2015 study.

Still, when it comes to spending on the bigger ticket, consumers in this year’s study proved more enthusiastic than those surveyed last year, with 15.6% versus 14.8% looking at spending in the $251 to $350 price range and 20.9% versus 14% willing to spend $350 or more.

The Evolution Of Entertainment 

New device-oriented furniture purchases probably will wind up in the living room as 86.7% of consumers said that’s the location in they home where they are most likely to use electronics, up from 71.9% last year. However, consumers are employing electronic devices more frequently throughout the home. Adult bedroom rates as the next most common place for consumers to employ electronics at 62.8%, up from 53%, year over year, followed by office or study, at 42.2%, up from 30.1%. Kitchen trails at 32.5%, but up sharply from 19.2% in last year’s survey, and entertainment or game room rounds up the top five at 24.5%, also up sharply from 16.4%.

Consoles and related items designed to house flat panel televisions are critical to the whole entertainment furniture segment, but survey respondents were more ambiguous about their plans to purchase them. The proportion of consumers who said they would definitely purchase flat panel TV-related furniture over the year ahead gained slightly to 16.3% from 15.6% in last year’s survey, but the percentage that said they would very likely to do so slipped four points versus the one conducted in 2015, to 15.4%.

However, the proportion of those who said they were somewhat likely to purchase flat-panel associated furniture jumped to 33.5% from 25.5% a year ago. Likewise, fewer people were definitely or very likely going to purchase furniture to house components of a home entertainment system this year versus last, but, again, the somewhat likely to purchase group grew to 32% from 26.8%, and the not at all likely result was essentially flat versus last year.

When considering furniture to house a TV, style of furniture is the main consideration followed by price, with other factors considerably less urgent, according to the study. However, while in this year’s survey price trailed style, at 21.8% versus 51%, the opposite was true in the 2015 study, when 35.9% of consumers said price was most important factor as opposed to 34.8% who selected style as their main concern.

Overall, consumers are somewhat more likely to consider a media furniture purchase if they’re thinking about buying a flat-screen television over 50 inches than if they are weighing a smaller unit. However, the enthusiasm isn’t wholesale. In conjunction with buying a big flat panel, 14.8% of consumers surveyed said they would definitely purchase a piece of compatible furniture versus 16.3% of those just thinking about purchasing a TV in general terms, but 25.7% said they would very likely do so versus 15.4% of those less set on a jumbo device. So, in total, the furniture purchase seems more likely with a bigger TV.

Connecting to the influence of computers, more than 60% of consumers surveyed would consider purchasing some form of furniture to house a computing device, which is up slightly from last year with the definitely group advancing to 12.7% as compared to 11.9%. The very likely group slipped about a point and a half but the somewhat likely preference grew to 32.9% from 25.2%.

The attractiveness of furnishings that support the use of electronic devices is growing. In this year’s Home Entertainment Furniture Report survey, 60.4% of consumers said that furniture or accessories that can mount, store or recharge multiple electronic devices are more attractive to them versus 44.4% in last year’s study.

When asked if they would actually buy furnishings that would incorporate charging capabilities, 13.9% of survey respondents this year said they definitely would and 22.4% said very likely would as opposed to 13% and 16.6% respectively of participants in the 2015 study. More respondents said they were somewhat likely to buy items that would help them charge and maintain their devices in the 2016 study, at 34.4%, than the one a year earlier, at 33%.

The flexibility of design is an issue as more consumers overall said they might consider multi-purpose or customizable entertainment-related furniture as a purchase in the immediate future. Although the definitely figure slipped by a couple of points to 13.2%, the very likely response advanced to 34.5% from 29.4% in last year’s survey and somewhat likely increased to 42.2% from 36.4%.

When it comes to where those shoppers who intend on buying electronics-related furniture, 28.9% of consumers responding to the study said electronics superstores would be their most likely shopping destination, up from 26.8% last year, but coming in a close second, at 24.3%, and better than the 23.4% in the year earlier, is a sector that doesn’t even sell electronics: the traditional furniture stores. Of course, many consumers, particularly the more affluent, will gravitate toward case goods, particularly if they have a house full of similar furnishings.

However, demonstrating the evolution of furniture purchasing, Internet retailers came in third place at 21.5% up from 13.2% in last year’s study. The gain put the digital sellers ahead of discounters, a sector that rated 12.6% this year, down from 17.1% in 2015. Further along the list, department store and warehouse club numbers also shrank a bit this year from last.

For furniture construction, mixed materials edged up in the 2016 survey as did all glass, with all wood slipping a bit from the survey last year.

A Charge In Electric Fireplaces

Electric fireplaces have exploded in popularity over the past few years, but in this year’s Home Entertainment Report survey, fewer consumers, at 12.9%, reported purchasing them than was the case last year, at 17.9%. Still, the number isn’t bad for a relatively big-ticket sector and, if extrapolated out across the population of the U.S., that percentage represents over 40 million purchases over the past three years. By a narrow margin, more consumers who have purchased an electric fireplace did so as part of a furniture piece rather than in a stand-alone configuration.

A significant portion of the population maintains an intent to purchase electric fireplaces, with 11% of consumers saying they were very likely and 24.5% saying they were somewhat likely to purchase an electric fireplace/mantel combination over the next year. In addition, 9.8% of consumers said there were very likely and 22.6% said they were somewhat likely to purchase a TV stand with a built-in electric fireplace.

Overall, the numbers are down a bit from last year, which suggests the category is maturing somewhat, but they suggest that demand will remain relatively strong for some time to come.

Although vendors sometimes note that relatively few consumers ever use the heating capacity of electric fireplaces, it remains a selling point. That being said, the importance of looks and heating capability flipped in this year’s study from last. When asked which is more important as a purchase consideration, 15.7% of survey respondents in the most recent study said that their most important purchase consideration is how an electric fireplace looks and 12.9% said how it heats. In the 2015 study, looks got 17.4% of the vote while heating capability got 22.6%. However, consumers saying both are equally important increased to 71.4% from 60% year over year.

Generally, consumers in the 2016 study were willing to pay more for an electric fireplace that was the case last year with fewer expecting to spend less than $100. All the other price designations edged up except the $400 or less, which came in about seven points lower versus the 2015 study. In contrast, the more than $500 designation proved more popular by about five points year over year, coming in at 12.9% of responses.

A remote control was by far the most important feature for consumers who might be deciding to purchase an electric fireplace, cited for its importance by 75.8% of consumers in the study even if slightly less often this year than last.

The two and three slots in the study results flipped as timer controls gained popularity with survey respondents, cited by 48.1% of participants, and surpassed infrared heating, which slipped a bit year over year to 46.5%. The ability to mount a flat panel TV on top gained significantly, as it was cited by 41.5% of survey respondents this year versus 26.8% a year ago, and slipped into the fourth slot in the popularity rankings. Storage cabinetry or display shelves moved up into the fifth position despite slipping slightly, cited by 36.5% of consumers versus 37.7% the year earlier. The move was predicated on a bigger decline in the popularity of flame color change capability, down to 34.3% from 39% year over year.

Survey respondents least frequently cited speakers as an important feature but the interested in them as a purchasing factor remained essentially unchanged from last year with 17% of study participants declaring them important.

Given that many mass-market furniture producers are or have experimented with adding sound to furniture, effectively increasing its potential as a home entertainment vehicle, this year’s study asked consumers if they were interested in purchasing furniture that incorporates audio capabilities.

The response was largely positive, with a third of consumers saying they would very likely purchase such furniture and over 40% saying they were somewhat likely to do so. If not the top consideration among consumers, sound bars or other audio components may entice a significant proportion of shoppers to trade up a purchase if not make one outright.

Home Entertainment Lifestyles

With this year’s study, HomeWorld Business also determined to look at how consumers were integrating home entertainment furniture into their lifestyles. As it turns out, the living room and family room are the locations where the overwhelming majority of survey respondents are most likely to entertain guests. In the study, 64% of participants cited the living room and 24.4% cited the family room as the domestic space they are most likely to use for entertainment purposes.

No other room gets even 5% notice as the prime entertainment site with media room and kitchen tied as 3.3%, the dining room following at 2.9% and the patio/balcony/yard trailing at 2.3%.

The results for the dining room and kitchen suggest that, even though the country may have developed a more robust foodie culture, hosts are serving refreshments in a casual manner. The result for outdoor spaces, and despite the popularity of barbecues, is also evidence that the entertaining focus remains in the more traditional parlor setting. At the same time, media rooms, thought to be on the rise before the recession, have not taken off as home entertainment settings.

However, that’s not the whole story. When asked about which furniture items they might have purchased over the past year with at least some consideration for entertaining guests, two-thirds of survey respondents identified an item from at least one furniture segment. Although the outdoor setting scored low as primary entertainment space, consumers said they purchased patio items with entertaining in mind more than any other kind of furniture.

Given the seasonal element of outdoor entertaining, the two results aren’t necessarily in conflict but may actually demonstrate the importance of home entertaining as consumers appear willing to spend on secondary spaces where they might welcome guests to their homes.

About 28.3% of consumers in the study said they had purchased patio furniture with guests in mind. Beyond that, 26% said they had purchased accent seating to help entertain and 20.1% said they had purchased an accent table with guests in mind. Rounding out the top five were dining table, at 18.2%, and entertainment center, at 17.9%. A traditional entertaining category, folding furniture, immediately followed at 16.2%.

Looking ahead, a greater proportion of consumers, more than 70%, said they would likely buy furniture to entertain guests in the year ahead. In an interesting contrast, the top segment under purchase consideration is entertainment centers, at 22.7%, followed by patio furniture, at 22.4%, accent seating, at  20.8%, and accent table and bar cart, both at 18.2%. In looking forward, survey respondents ranked folding furniture, at 10.1%, behind electric fireplace TV stand, at 14.3%, standard TV stand, at 11.4% and kitchen island, at 10.4%, as a purchase priority.

The results again demonstrate that the living and family room is key to home entertaining but secondary locations are priorities for a significant proportion of consumers.

Safety also is a key consideration. The overwhelming majority of consumers believe that tip over safety is an important factor in purchasing media furniture. Only 6.5% of consumers responding to the survey consider tip-over safety features unimportant. Around three quarters rated them as important, very important or must-have features.