D
devadevam2788
Guest
devadevam2788 Consumers tuning in to car stereos The seemingly mature best car speakers brands, top speakers for cars market is displaying youthful vigor for the first time in years. More people are shopping for automotive sound these days because compact discs, stereo televisions and digital VCRs have rekindled interest in all audio equipment. After four flat years, consumer interest in car stereo has finally taken off. In Chain Sotre Age MarkeTrends surveys, the number of people who say they might buy a car stereo in the coming 12 months was just above 3% from the beginning of 1982 until late last year. In November, the number rose to 4% and this month grew to nearly 5%. Households actively shopping for automotive sound has increased at the same time. After years of fluctuating from a low of 0.8% to a high of 1.4%, the figure rose to 1.6% in November and jumped to nearly 2% this month. Research indicates retail sales of car stereo by domestic car makers and the aftermarket will climb from last year's $2.8 billion to about $3 billion this year. One reason for the growth is that any audio advance can indirectly benefit the entire consumer electronics business, says an industry insider. "Stereo TV is making people more sound conscious and that helps us all," she says. Another reason is the direct benefit of advances such as the compact disc player for cars, says James Pedranti, vice president for marketing of Sparkomatic Corp., a manufacturer of bet car speakers in the world for the mass market. His company will introduce an adapter to mate portable CD players to car sound systems for a retail of about $20. "CD is probably the greatest thing that's happened to our industry since the invention of the car radio," Pedranti says. Chet Sharp, stereo buyer for Harts, a 27-store Columbus, ohio-based discount chain, shares the enthusiasm for car CD. He hopes to carry some models later this year and says, "all the mass merchandisers will get into it eventually." Pedranti believes car owners will yank cassette players from their dashboards after hearing CD, much the way they quickly replaced eight-track with cassettes. "It's that built-in obsolescence we're always looking for." Just when the big switch to CD will happen is in doubt, others say. "I'm surprised it's taking as long as it has," says Larry Carpenter, Sony national sales manager. His company began marketing two car CD players a year ago. Cassettes may retain their popularity longer than eight-track, says Tony Mirando, national marketing and sales manager of JVC's car audio division. His company will introduce a car CD player in February. Mirando also sees digitally recorded tape as a competitor to CD in future car stereo wars. Digital tape sounds better than conventionally recorded tape but falls short of CD quality. Digital tape has the advantage of home recording, however. With either new system, initial high prices are bound to chase away many potential customers. A technological breakthrough is needed to bring down the CD price and reduce its size, says Carpenter of Sony. Mirando, meanwhile, is predicting the rarest of events in consumer electronics will come to pass this month--a price increase, this one due to a drop in the Japanese yen. A price hike would reverse a long slide. JVC, for example, is introducing a car stereo that will probably sell on ad for $179. Mirando says a comparable stereo would have brought $329 three years ago. Price erosion is often mentioned as a reason for the category's improved sales outlook. While it is true that the price of any one model has probably dropped, the average price of car stereos is actually increasing because the number of features is growing. Electronic tuning is one feature that has become nearly universal. Still more features--as well as higher-priced, better-quality equipment--may sell well as audio awareness builds. Sparkomatic is banking on that trend with a new line of speakers that will debut under the Altec Lansing name. The mass marketer hopes to step up to specialty stores with the new name. As old customers trade up, people once satisfied with AM radio may enter the lower end of the market. Sony will be ready for them with the new Express line. Sony is using the series to break into the discount market while continuing to offer higher-priced equipment. Some other manufacturers are showing more willingness to see their wares on discounters' shelves. But some scrambling by vendors is due to uncertainties caused by changes in the way automobile manufacturers market car stereo and by fluctuations in the auto market. Detroit lagged behind the aftermarket in introducing cassettes and may trail again with CDs. The automakers are putting in better stereos these days, however, and their gains in market share mean losses for aftermarket retailers. "A lot of people in the industry are concerned about Detroit," Pedranti says. He cites the example of the 1986 Buick Riviera which makes the factory-installed radio an absolutely vital link in the car's electronic navigation system. During the first seven months of the 1985 model year, domestic car makers, importers and dealers installed more than 1.5 million conventionally tuned radios and in excess of 3.2 million electronically tuned units. More than 10,000 systems included CD players, according to Ward's Automotive Reports. Yet some retailers show little concern about competition from the car companies. "Our business is in used cars," says Sharp of Harts. The stereo buyer for an East Coast-based discount chain agrees that the automakers are not a threat at this point. "Our car stereo business is increasing every year, so as of yet, I can't say that we're affected by it," says the buyer. As the debate continues on new car sound, auto sales are expected to decline this year from 1985. Whether that effects aftermarket stereo sales is questionable. Market analyst Raymond Boggs of Venture Development Corp., a Natick, Mass.-based research group, says that when new car sales drop, people are keeping their cars longer and thus are more likely to buy aftermarket stereos. At the same time, however, decreased new car sales lowers the number of cars on the road and thereby shrinks the stereo aftermarket. "It's probably a wash," Boggs says. Venture Development expects the factory value of best car speakers brands, best car audio speakers shipments to rise strongly both for new vehicles and for the aftermarket. It calls for new car stereo shipments to grow at an annual rate of 11% from $1.1 billion last year to $1.8 billion by 1990. Aftermarket shipments will grow from just over $1.1 billion in 1985 to $1.6 billion in 1990, an annual increase of 9.4%. Although the researchers see factory installations outstripping aftermarket, the picture for retailers remains bright.
Continue reading...
Continue reading...