Gap Intelligence: 4K UHD TV Placements Squeezing 1080p Models
According to the latest information from market research group gap intelligence/Quixel Research, 4K Ultra HDTVs reached 40% of U.S. retail placements at the end of 2015. A placement is the presence of a unique stock keeping unit (SKU) at a single retailer. The same TV found at Best Buy and hhgregg will be counted as two placements.
Deirdre Kennedy, gap intelligence/Quixel TV market analyst, said Ultra HDTVs have been increasing shelf share since their launch in late 2012, and the rapidly rising rate at which manufacturers are introducing the number of new 4K Ultra HD at the expense of Full HD 1080p models continues to fuel that growth.
Read more on growing 4K UHD TV merchandising efforts after the jump:
Kennedy pointed out that as 4K Ultra HDTV sales accelerate Full HD 1080p HDTVs have dropped in shelf share from 71% a year and a half ago to 46% of the shelf today. In the meantime, the selection of entry-level 720p TVs has remained flat as the segment is dominated by entry level, small screen models, largely from third-tier manufacturers.
“It is true that screen sizes for Full 1080p HDTVs are gradually getting smaller and more basic,” Kennedy told HD Guru. “This change is a direct result of Ultra HDTVs taking over the premium segment of the TV category. Full HD models are now expected to fulfill the mid-level requirements of the TV category in that they offer an attractive price point and a serviceable product, but for larger screens and better features, shoppers will most likely have to purchase a 4K television.”
Kennedy said sales of organic light emitting diode (OLED) TVs are slowly growing market share, although LG’s currently exclusive display technology remains a very small part of the overall TV mix. She said the small size of the category makes it difficult to pinpoint the motivators behind its early expansion.
“However, LG continues to make advances in OLED panel yields, which allows them to offer additional tiers of OLED TVs for consumers to choose from,” Kennedy said. “LG continues to hold to its goal of positioning itself as the leader in OLED TVs when the market begins to grow in a few years.”
Gap did not yet have sales results from the just ended Super Bowl period, but Kennedy said that
advertising activity for television sets was stronger in the four weeks leading up to the game than in previous years.
“It was only during the final week before the big game that 2016 numbers fell below peak advertisements from prior years, although 2016 numbers stayed within 12 ads of past years. Overall, it seemed that merchants and vendors alike were doing their best to ride the wave of Super Bowl interest and hold it as long as possible,” Kennedy said.
Kennedy observed that retail advertisements and in-store promo reels blasted messages throughout January that equated football with TV shopping.
This year’s ads offered slightly higher promotional value than last year, with an average total ad value of $446 in savings, compared to $423 in 2015, according to gap.
Ultra HD was also used as a reason to get shoppers to trade up to a new TV, Kennedy said. Ads proclaimed the benefits of watching the football championships [up converted to] 4K, so much so that a full 50% of all TV ads placed during the month prior to Super Bowl weekend were for 4K units. By contrast, just over 20% of all ads in 2015 were for Ultra HD, Kennedy said.
By Greg Tarr
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