Even in a down economy, when it

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1 Holiday Shopping Same old, Same old? By Peter Goldman, The NPD Group, Inc. Fall 2010 Even in a down economy, when it comes to the holidays, consumer behavior is somewhat predictable. Many of the same categories have been among the top fourth-quarter sellers for the last three. For the past two during Black Friday week, many of the same models made the top- sellers list. In small kitchen electrics, the same eight categories were top fourth-quarter sellers three in a row. The top five retained About Housewares MarketWatch Housewares MarketWatch reports both point-of-sale (POS) and consumer data from NPD databases. The quarterly data covers various product categories within the divisions of Small Appliances and Non-electric Housewares. The information contained on the following pages is offered as a snapshot of a category s performance, both from the retailer (POS) and consumer perspectives. The POS data covers the retail channels of mass/national chains, department store, specialty store and drug store (personal care and home environment only). Each issue of Housewares MarketWatch will feature several categories from the Small Appliances and Housewares divisions. Complete data on a category can be purchased by visiting NPD s website at the Data and Methodology section on page 8 for an explanation of how the data is compiled. the same ranking year after year, and the top three accounted for one-third of total sales. NPD s Consumer Tracking Service shows drip coffeemakers, stand mixers, food processors, blenders, slow cookers, electric grills, toaster ovens and toasters garnered the most dollar sales in Q4 of 2007, 2008 and When focusing in on the week of Black Friday, and looking at the model level, we see strong consistency between 2008 and 2009, with the same stand mixer in the top spot both. Similarly, the personal care appliance market saw hair straighteners/crimpers, electric toothbrushes, men s electric shavers, massaging appliances, shower heads and hair dryers in the top six selling categories of the fourth quarter. During Black Friday week, the top seller was the same hair straightener/crimper model in both 2008 and Upright vacuums, heaters, deep carpet cleaners, water filtration replacement filters and canister vacuums were the top five home environment categories of the fourth quarter for the past three. The upright vacuum that was the top home environment seller of Black Friday week 2009 was not at the top in 2008, but the same brand was the 2008 winner. It is no secret that steep promotions were a strong force in the 2008 and 2009 holiday seasons. Across all three small appliance category groups, prices declined among fourth-quarter 2009 top-selling items that also sold in All of the top 10 small kitchen electrics items for 2009 were also at market in 2008, but if we were to put all of these items into one shopping basket, the average price dropped by 4 percent from 2008 to The change was more dramatic in personal care, where the top 10 items took an 8 percent cut in average selling price in the continued on page 8

2 Small Appliances: KITCHEN ELECTRICS TOTAL MARKET 21,530 11,959 FOOD PREP/ BEVERAGE COOKING ELECTRICS 9, % ELECTRIC GRILLS/GRIDDLES REGION Percentage purchased in region versus census 19.0 % 25.9 % 22.7 % 39.1 % 35.9 % ELECTRIC GRILLS/ GRIDDLES CENSUS (PERCENT OF POPULATION) 19.2 % 22.3 % SLOW COOKERS In Q3 10, the mid-size slow cookers lost dollar share to smaller and larger options compared to Q3 09. Models with qt. capacity gained four share points, and those with 5.1 qt. capacity or more gained nearly 20 points. VACUUM SEALERS Northeast Central South West FOOD PROCESSORS BUYER GENDER Percentage purchased by buyer gender versus census FOOD PROCESSORS 58 percent of Q3 10 vacuum sealer dollar sales came from models with bag storage, and increase over the previous year % 48.9 % 61.3 % 51.1 % BREADMAKERS The top 3 motivators behind purchasing a breadmaker between April and September 2010 were features, price and brand value. Male Female 2

3 Small Appliances: PERSONAL CARE TOTAL MARKET 40,309 HAIR CARE/ GROOMING 21,837 ORAL CARE & OTHER PERSONAL CARE 18, % MEN S ELECTRIC SHAVERS INCOME Percentage purchased by income versus census 15.8 % 16.6 % 11.5 % 16.1 % 14.4 % 13.7 % 11.5 % MEN S ELECTRIC SHAVERS 16.4 % 13.2 % 11.8 % 11.3 % 6.5 % 9.5 % 8.3 % 8.6 % WOMEN S ELECTRIC SHAVERS 3.5 % Women s electric shaver models with triple heads/foils accounted for 13 percent of dollar sales in Q3 10, up almost 4 points compared to the same time in Under $15,000 $15,000 29,999 $30,000 44,999 $45,000 59,999 $60,000 74,999 $75,000 99,999 $100, ,999 $150,000 + Teens with No Income ELECTRIC TOOTHBRUSHES BUYER GENDER Percentage purchased by buyer gender versus census 0.0 % HAIRDRYERS ELECTRIC TOOTHBRUSHES Hairdryers with ceramic technology represent 39 percent of category dollar sales in Q3 10, up almost 4 points compared to Q % 64.2 % 51.1 % 35.8 % FACIAL TRIMMERS The top 3 motivators behind purchasing facial trimmers between April and September 2010 were features, price and brand trust. Male Female 3

4 Small Appliances: HOME ENVIRONMENT (EXCLUDING VACS) TOTAL MARKET 20,787 HEATERS AGE OF BUYER Percentage purchased by age of buyer versus census 37.3 % HEATERS WATER FILTRATION Dollar sales of in-line water filtration devices gained 3 share points in Q3 10 vs. Q3 09, now accounting for 18 percent of the market. WATER FILTRATION 17.6 % 11.5 % % 9.0 % HEATERS INCOME Percentage purchased by income versus census 16.3 % 15.5 % 65 + HEATERS CENSUS (PERCENT OF POPULATION) 8.5 % 16.6 % 15.2 % 16.1 % 13.7 % 20.8 % 18.9 % 11.5 % 24.8 % 5.4 % 13.2 % 17.2 % 4.5 % 11.3 % 5.0 % 11.5 % 14.7 % The top 2 motivators behind purchasing water filtration devices between April and September 2010 were features and price. Under $15,000 $15,000 29,999 $30,000 44, % $45,000 59,999 $60,000 74,999 $75,000 99, % $100, , % 6.5 % 0.0 % $150,000 + Teens with No Income 4

5 Small Appliances: FLOOR CARE TOTAL MARKET 7,214 HAND VACUUMS AGE OF BUYER Percentage purchased by age of buyer versus census 11.9 % 21.0 % 15.4 % 18.9 % 17.0 % 17.2 % HAND VACUUMS CENSUS (PERCENT OF POPULATION) 15.5 % 9.0 % 12.4 % 14.7 % 6.8 % DEEP CARPET CLEANERS Deep carpet cleaners represent 19 percent of total full size vacuum dollar sales in Q3 10. HAND VACUUMS HOUSEHOLD SIZE Percentage purchased by household size versus census 38.0 % HAND VACUUMS 26.3 % DEEP CARPET CLEANERS 14.1 % 10.3 % 15.3 % 19.3 % 20.5 % 22.6 % 12.1 % 21.4 % The top motivator behind purchasing deep carpet cleaners between April and September 2010 was features. Single Member Two Three Four Five or More 5

6 Housewares: NON-ELECTRIC 50,000 40,000 30,000 20,000 10, ,074 41,474 16,164 DINNERWARE BEVERAGEWARE FLATWARE STOVETOP COOKWARE CUTLERY OVEN OR MICROWAVE BAKEWARE 15,005 12,230 COOKWARE BAKEWARE 9,924 Cookware with a nonstick interior accounted for more than 60 percent of Q3 10 dollar sales. Glass bakeware gained 2 share points in Q3 10, compared to Q3 09, now representing more than 22 percent of category dollar sales. STOVETOP COOKWARE HEAD OF HOUSEHOLD AGE Percentage purchased by age of head of household 5.3 % STOVETOP COOKWARE OVEN OR MICROWAVE BAKEWARE HOUSEHOLD SIZE Percentage purchased by household size versus census 22.2 % 10.3 % 19.7 % % 26.3 % 24.8 % % 24.3 % 19.3 % 16.1 % 17.2 % OVEN OR MICROWAVE BAKEWARE 12.3 % 17.3 % 22.6 % 14.7 % 21.4 % 14.7 % FLATWARE The top 3 motivators behind purchasing flatware between April and September 2010 were price, value and appearance. Single Member Two Three Four Five or More 6

7 Home: KITCHEN & DINING TEXTILES APRIL-SEPTEMBER 2010 KITCHEN & DINING TEXTILES TABLE LINENS HEAD OF HOUSEHOLD AGE Percentage purchased by age of head of household In the 6 months ending September 2010, kitchen & dining textiles unit sales increased by more than 40%, however dollars declined by just over 2%, compared to April through September % 20.1 % 21.4 % 18.9 % 23.1 % 17.2 % 16.0 % TABLE LINENS CENSUS (PERCENT OF POPULATION) 14.3 % 14.7 % exhibitors from 6 continents attendees from over 120 countries March Chicago USA Show information and free online pre-registration: for visitors: for exhibitors: 7

8 Holiday Shopping Same old, Same old? Continued from page 1 course of the year. Within home environment, four of the top 10 Q4 sellers for 2009 were brand-new, but the average price of the six that were around in 2008 dropped by 10 percent. Considering the steep discounts, perhaps these numbers are less surprising. That said, when gifting, consumers have typically shown a tendency toward spending a little more, so perhaps that bridges the gap between the expected and the actual. Thinking about the categories that have traditionally performed well for the holidays, the consumer state of mind has been rooted in both practical and aspirational thinking, but innovation is clearly finding its place. Mixed in among the consistent sellers from year to year, we do see a handful of innovations during the holiday season. In most cases, these fit within the usual-suspect categories. This is an interesting dynamic, because while consumers err on the side of consistency, they are obviously hungry for something new and unique. We ve seen a lot of innovation this past year, and judging from the top sellers of recent, this could be the key to breaking into consumers wallets. When the Holiday 2010 data and analysis roll in, we ll see if we successfully anticipated the winning categories based on past performance. The interesting questions will be how deep did the discounting need to go during Holiday 2010 and what innovations grabbed consumers attention and dollars. Peter Goldman is president of the Home Section at The NPD Group. These are the opinions of Goldman and NPD. For more information, contact Goldman at Take a look inside the home! kitchen personal care home environment laundry appliances Uncover opportunities for your business with The NPD Group s new report, Inside the Home: Appliances We Own & Use. INTERESTED? Contact Charles Camaroto at (contactnpd@npd.com) for details. 8

9 DATA AND METHODOLOGY NPD has a standard data model that is used for all categories that incorporates both consumer and point-of-sale (POS) databases. These two data sources are highly complementary and are used to support one another. Point-of-Sale (POS) databases are assembled from retailers' records of actual sales by product as collected at the cash register. Consumer databases are developed using online purchase surveys completed by a largescale rotating sample of consumers. These data produce estimates of sales by product for the total marketplace. More importantly, the consumer surveys capture information about each purchase, such as buyer demographics, the product's intended use and other purchase motivators. CONSUMER METHODOLOGY The NPD online consumer panel is comprised of pre-recruited individuals who have agreed to participate in NPD online surveys and have completed a comprehensive demographic questionnaire. The use of an established online panel assures good cooperation levels and predictable demographic balance among panelists. Consumer panelists are asked about their recent purchases in a survey administered via the Internet. The responding sample is demographically weighted and projected through a series of steps to represent the Total Adult (18+) and Total Teen (13-17) U.S. population for appliances. Each week, over 35,000 individuals are selected from the NPD online consumer panel to participate in the appliance study. Each month, over 30,000 U.S. households are selected for the housewares and home textiles studies. POS METHODOLOGY NPD collects point-of-sale retailer data from selected retailers. These data are the actual sales for the chain on an SKU-by-SKU basis. The data are combined with data from other retailers to produce reports on certain categories by channel, where a sufficient number of retailers are cooperating and where sufficient market demand exists for the database. ABOUT THE NPD GROUP, INC. The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,800 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us or visit Deborah A. Teschke, Senior Editor Peter Goldman, Contributing Editor Janine Marshall-Bolton, Contributing Editor Tom Goodman, Design Published by IHA For more information, contact Debbie Teschke at ; or dteschke@housewares.org SHAFER COURT, STE. 650 ROSEMONT, IL USA TEL: FAX: