Headphone Sales Grow as Portable Devices Become Primary Music Player
The global audio-visual headphone market is expected to see 20% growth in 2012 to reach $6 billion in value, up from $5 billion in 2011, according to Futuresource Consulting.
That could be good for radio, as consumers use some of those products on-the-go.
Fuelled by a growing base of portable AV devices including smartphones and tablets, the market for headphones — including in-, on-, and over-ear headsets — will continue to witness strong growth through 2016, as portable devices become the primary music player for a growing number of consumers.
That’s according to a report from the market trend consultancy.
In unit terms, Futuresource forecasts anticipate sales in excess of 260 million units in 2012, up from 228 million units in 2011. The company predicts growth throughout the forecast period, with the market expected to top 330 million units in 2016.
Soaring portable device ownership, including smartphones and tablets, as well as a proliferation of digital content for these devices and multiple ownership of headphones are the key drivers in the market and will remain so moving forwards, according to the consultants.
Looking to the hardware, manufacturers are investing significantly to differentiate their products and educate their core audience about the specific features and benefits of their brands, as the headphone market becomes more crowded and competitive.
Fashion and design have become important factors in consumer purchasing decisions, resulting in significant revenue share for brands such as Skullcandy and Monster, which are particularly popular among teenagers and other young music enthusiasts.
Sony, Philips, Sennheiser and JVC dominate in terms of unit sales, according to the consultants. Revenue share is increasingly dominated by a collection of high-end brands, like Bose, Monster/Beats by Dr. Dre, Skullcandy and AKG.
In terms of the specific market segments, in-ear headphones typically priced at under $25 still dominate the market accounting for over 60% of total headphones unit sales. However, the high-end over-ear headphones have seen big growth, particularly in developed markets. As a result, average retail price increased by 8% to reach $22. Over-ear headphones accounted for 16% of the overall sales in 2011.
The Olympic Games provided brands with a lucrative opportunity to gain exposure through effective marketing strategies and celebrity endorsements. Despite strict rules for athletes not to promote any non-sponsoring brands throughout the games, some high-end brands circumvented this rule by handing out free headphones to select athletes, many of whom then chose to wear them during or in preparation for an event.