'Paradigm shift' is under way in entertainment
By Larry Thomas -- Furniture Today, April 29, 2006
At The Market — Even though television screens are getting larger, the furniture on which they sit is getting smaller.
Furniture producers say the white-hot market for flat-screen televisions has them scrambling to design smaller, more functional products to accommodate the new technology.
That means the massive wall systems that have been a staple of entertainment furniture for decades are becoming old-school, while sleek consoles that can hold massive flat-screen TVs are new-age.
"A major paradigm shift is occurring," said Eric Shupak, president of Furnitech, which began importing entertainment consoles from Brazil more than a year ago. "Consumer awareness of the new technology is increasing rapidly."
Shupak and other executives say this shift represents what may be an unprecedented opportunity for furniture retailers. A recent survey by the Consumer Electronics Assn. found that 49% of Americans say their next television purchase will be a flat-screen model — and that should push television shipments from $22 billion this year to $30 billion annually by 2009.
"If the explosive growth in television sales hasn't gotten your attention yet, it should," said Kelly Cain, vice president and product manager for Stanley. "And consoles are increasingly popular with contemporary consumers who view technology as an integral part of their lives."
Stanley and Furnitech are two of at least two dozen manufacturers showing new entertainment consoles at market.
New players enter the category
Some, including Magnussen Home and Philip Reinisch, are showing home entertainment furniture for the first time. Others, such as Progressive and Orleans, have refined their offerings in response to increased demand for furniture for high-tech flat-screen TVs such as plasma, LCD and DLP.
"We have redesigned all our consoles so they could be (sold as) free standing," said Tim Donk, marketing director at Legends Furniture, an importer best known for its wall systems. "As screen sizes get larger and larger, people don't want to take up too much wall space with the furniture."
This newest generation of consoles can usually accommodate screen sizes of 60 inches or more, and they include space below the television for speakers and components such as a DVD player and stereo receiver.
Some also have a back panel for mounting a plasma TV. Producers say plasma models look cool when consumers see them wall-mounted in advertisements, but such mountings are difficult and expensive, so most reject that option. (LCD and DLP models don't need to be mounted.)
Another reason for the popularity of consoles is that, unlike traditional wall systems and entertainment centers, they aren't built for a single screen size. Producers say it would be foolish to try to design a unit for every screen size because new sizes are being introduced almost weekly.
"Consoles are more functional in that it lets (the consumer) pick the size of the TV," said Tom Klinkert, vice president of sales and marketing at Orleans. "You may buy a 42-inch screen now, but three years from now, you may want a 52-inch screen."
Plus, producers say consumers, particularly females, no longer feel the need to hide the TV behind a set of pocket doors when it's not in use. The high-tech TVs are stylish in themselves and most owners want to show them off.
"You've got to find a way to give the consumer a value, but let the TV be the focus of the room," said Tamara Evans, vice president of imports at Progressive.
Pricing challenges
The one negative implication for both retailers and manufacturers is price. Consoles, as you might expect, cost a lot less than large wall systems, so neither party can generate as many dollars per unit sold.
Traditional wall systems often retail for thousands of dollars, while consoles rarely carry price tags of more than $1,000. And even if a back panel or a pier unit is added to the console, the price tag seldom tops $2,000.
"There is a reverse effect at work here," said Jeff Cook, president of Magnussen Home. "A few years ago, we were selling $6,000 wall systems that were built to house $500 to $700 TVs. Now, we're selling $2,000 wall systems to house TVs that may cost $5,000 or $6,000."
But in spite of that, many producers are convinced that retailers are missing out on numerous potential sales if they don't become familiar with the new technology and get their message out to consumers bringing home new TVs.
"Some furniture retailers understand the enormous change that's going on, but a lot of them don't have a clue," said Shupak.
"And they're going to be stuck with these big wall systems that nobody wants."
-
Analyst: Flat-panel TV boom offers big opportunity
May 11, 2006 -
Home entertainment bolstered by electronics boom
Oct 14, 2007
Featured Company
-
FurnitureCore.com
FurnitureCore.com is a dynamic web application aimed at the furniture industry. Retailers and manufacturers alike will find our deep reserve of tools to be exactly what their furniture business needs.www.furniturecore.com... more
VIEW ALL GALLERIES
