Gap: Pre-Holiday Retail Promotional Efforts On TVs Mirror Recent Trends
The Sharp 55P6000U was offered by Walmart this holiday season at $298, although it was showing up `sold-out’ online, three days before Turkey Day.
The Black Friday selling period may be getting longer, both before and after Thanksgiving, this year, but many of the advertising and promotional approaches are staying the same.
That was the assessment of Deirdre Kennedy, television advertising and retail shelf-share analyst with San Diego-based research firm “gap intelligence.”
Kennedy told HD Guru, that, “On the whole, this year’s Black Friday preview ads closely resemble those of last year, [but] in contrast to previous years, which saw retailers shifting strategies as they tried to find the best combination of timing and product selection to entice shoppers, this year is rather stable.”
Kennedy said a number of retailers opted to extend the Black Friday specials period to the full weekend before Black Friday, which “gives retailers an extra weekend of shopping and deals as everyone tries to capture consumers’ dollars first.”
In terms of Black Friday advertising and circular counts, she said, “retailers’ Black Friday preview ads are more or less even with last year. Among retailers within gap intelligence’s panel, Best Buy (24), BJ’s Wholesale Club (31), and Costco (26) have the most advertisements for TVs as of November 17th. But Fry’s Electronics and PC Richard have yet to release their Black Friday deals information, and those retailers typically offer an even greater number of TV deals.”
Kennedy said that while Black Friday/holiday electronics print ads are up for some retailers, they at the same time, down for others this year,” which makes it hard to draw any broad insights about this year’s trends.
But the trend over the past few years, shows print ad counts for TVs in weekly circulars “have dropped dramatically. Electronics stores (Best Buy, PC Richard, Fry’s Electronics) still advertise heavily, while club stores and mass merchants (Target, Walmart) have pulled back from advertising TVs.”
Read more about this year’s retail holiday TV sales trends after the jump:
The week prior to Thanksgiving there are 115 TVs listed among Black Friday preview ads that have been released by merchants in gap’s panel (Amazon, Best Buy, BJ’s Wholesale Club, Costco, Sam’s Club, Target, and Walmart; Fry’s Electronics and PC Richard have not yet released their ad information),” Kennedy said. “Of these ads, 82 percent are for 4K Ultra HD models, 11 percent for 1080p HD, and 7 percent for 720p HD. Although these numbers are preliminary, they do show a dramatic shift toward 4K this year compared to last year when the breakdown was 65 percent UHD, 23 percent Full HD (1080p), and 7 percent HD (720p). An additional 5 percent did not specify.”
According to Kennedy, of the 94 4K models represented, 86 percent showed high dynamic range (HDR) support, 7 percent do not, and 6 percent of the ads were unspecified.
“However, Fry’s and PC Richard have yet to reveal their BF deals, and both retailers typically have a large selection of smaller and/or cheaper models, which may lessen the overall impact of UHD in this year’s final tally,” she added.
“Clearly, merchants and manufacturers are most interested in promoting the TVs that will gain them the biggest margins. Smaller, low-resolution TVs might sell large volumes if they have very competitive, doorbuster prices. But many consumers are looking for good deals on quality sets, so the combination of consumer interest and merchant/manufacturer gains produces a large proportion of UHD/HDR sets on sale for Black Friday,” Kennedy said.
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“However, overall trends in advertising have also been moving toward UHD/HDR. Gap intelligence’s most recent quarterly advertising overview showed that in the third quarter of 2017, 65 percent of all ads placed were for 4K TVs, 22 percent for Full HD models, and 13 percent for the 720p segment. These numbers show distinct year-over-year gains for 4K models at the expense of Full HD TVs. It seems clear that 4K is squeezing 1080p out of the market, while 720p maintains its footing as an inexpensive, small-screen option that would not benefit from increasing resolution. Going forward, we can expect to see Full HD TVs becoming more difficult to find as 4K models continue to be available in a range of prices.”
Among the biggest TV deals spotted prior to Turkey Day, Kennedy pointed to “two 4K TVs advertised for less than $200. Amazon will offer a 49-inch 4K TV for $159, while Best Buy will carry the Sharp LC-50LBU591U for $179 (normally $399).”
Among other deals, three 55-inch 4K TVs were being offered for less than $300:
- Toshiba 55L711U18 for $279 at Best Buy (normally $479).
- Westinghouse WE55UC4200 for $249 at Target (normally $379).
- Sharp LC-55P6000U for $298 at Walmart.
As for her picks for the biggest hits once all the dust has settled, Kennedy is leaning toward “4K TVs without a lot of extras, like the ones mentioned.
“Consumers are aware of 4K by this point and know that they want it, but sticker shock is still a real phenomenon, especially on Black Friday when shoppers want deals. My guess is that entry-level 4K models will sell well now that the number of placements and advertisements has truly gone mainstream,” said Kennedy.
Among the most aggressive retailers early in November were: Best Buy, BJ’s Wholesale Club, and Costco, but the wild cards are Fry’s Electronics and PC Richard, which have yet to release their ads, and which typically offer more models on promotion than other chains. Kennedy said she doesn’t expect any major surprises or strategy shifts among the key players.
Whether or not this year’s activity will produce any big changes in sell-through performance remains to be seen, Kennedy said.
By Greg Tarr
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