American consumers can t get enough

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1 Gadget Obsession & Opportunity Covering Quarters 2 & 3, 2015 By Joe Derochowski, The NPD Group, Inc. American consumers can t get enough kitchen gadgets, whether they are for cooking, prepping, entertaining, serving or specialty uses. Gadgets are a $1.4 billion business, and growing. U.S. dollar sales of gadgets are up 10 percent in the 12 months ending September 2015, compared to the prior 12 months. That translates to almost 305 million gadgets sold in the U.S. in the 12-month period, according to NPD s Retail Tracking service. 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 stores, specialty stores and drug stores (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 9 for an explanation of how the data is compiled. While sales of all types of gadgets are increasing, utensils designed for entertaining purposes grew at the fastest pace in the 12 months ending September 2015, up 13 percent in dollar sales. Cork screws and ice cube trays top the list in terms of total dollar sales, each bringing more than $30 million to the gadget category during this time period. However, ice buckets, flasks and barware tools and sets were the products that significantly outpaced the entertaining gadget segment with high double-digit dollar growth. Beyond demonstrating consumer interest in entertaining, these highest performing products also signal the importance of the essentials, as well as the extras. The relevance of both the basic kitchen necessities and those that could be considered more superfluous purchases is apparent when looking across all gadget segments. Spice products, mixing/prep bowls and nonelectric can openers were the kitchen gadgets that contributed the most dollar sales gains during the 12 months ending September Combined, those three products accounted for more than $200 million in sales and were the source of $27.6 million in category growth for the year. A device for growth Merriam-Webster shows the definition of gadget as an often small mechanical or electronic device with a practical use but often thought of as a novelty. Consumers are spending more than $1.4 million a year on products that are, by definition, practical but also a novelty, and that spending is increasing. Kitchen gadgets give consumers the opportunity to splurge without spending a fortune, express their personal style with colorful and cleverly designed products and help them perform daily tasks with added ease. Consumers young and old are focused on living a healthier life, integrating more fruits and vegetables and preparing more food at home, which paves the way for gadget needs. According to NPD s HealthTrack, more than 60 percent of consumers over the age of 55 have a medical condition, making a healthy lifestyle a priority. Today s Millennials are much more interested in health than prior generations were at the same age, and as a result are interested in fresh, homemade foods that allow them to control the ingredients in their diets. Given the changing lifestages and behaviors of two large generations of consumers the Baby Boomers and Millennials gadgets will probably continue to grow for the foreseeable future. continued on page 14

2 TABLETOP: Dinnerware, Beverageware, Flatware Quarter Two 2015 TOTAL TABLETOP 6 months ending June 2015 BEVERAGEWARE AGE Percentage purchased by head of household age $ 445,750 19% 17% 18% 19% 18% 8% PRICE SEGMENTATION: During Q2 15, sales of casual flatware sets priced between $10 and $14.99 declined by 29 percent, compared to PURCHASE BEHAVIOR: Half of the dinnerware sold in Q2 15 were planned purchases. PURCHASE INFLUENCE: Only 20 percent of flatware purchased in Q2 15 was on promotion. CHANNEL PERFORMANCE: During Q2 15, one-fourth of flatware purchases were at specialty stores, 5 points higher than in Q2 14. PURCHASE MOTIVATORS: When it comes to selecting beverageware, consumers said appearance, good value and price were the top motivators in Q2 15. ONLINE SALES: 30 percent of dinnerware sales in Q2 15 were from online purchases. Source: The NPD Group 2

3 TABLETOP: Dinnerware, Beverageware, Flatware Quarter Three 2015 TOTAL TABLETOP $479,308 6 months ending September 2015 DINNERWARE INCOME Percentage purchased by head of household income 20% 11% 11% 14% 12% 12% 12% 8% Under $15,000 $15,000- $29,999 $30,000- $44,999 $45,000- $59,999 $60,000- $74,999 $75,000- $99,999 $100,000 - $149,999 $150,000+ FEATURES: Fine flatware sales, representing 14 percent of total flatware, is down by 12 percent in Q3 15 as compared to Q3 14. PURCHASE BEHAVIOR: Nearly two-thirds of flatware sold in Q3 15 was a planned purchase, down slightly vs Q3 14. PURCHASE INFLUENCE: Less than half of the dinnerware purchased in Q3 15 was on promotion. PRICE SEGMENTATION: During Q3 15, housewares dinnerware pieces priced between $3 - $5 accounted for 14 percent of total units sold, and sales increased 32 percent. PURCHASE MOTIVATORS: When it comes to selecting dinnerware, consumers said appearance, price and good value were the top motivators in Q3 15. ONLINE SALES: Around 10 percent of beverageware was purchased online in Q Source: The NPD Group

4 COOKING/KITCHEN: Cookware, Bakeware, Cutlery Quarter Two 2015 TOTAL COOKING/KITCHEN 6 months ending June 2015 BAKEWARE INCOME Percentage purchased by head of household income $686,384 20% 22% 10% 12% 9% 10% 11% 7% Under $15,000 $15,000- $29,999 $30,000- $44,999 $45,000- $59,999 $60,000- $74,999 $75,000- $99,999 $100,000 - $149,999 $150,000+ CHANNEL: In Q2 15, dollar sales of bakeware purchased at specialty stores doubled in size, compared to Q2 14. PURCHASE MOTIVATORS: When it comes to selecting cookware, consumers said price, good value and easy to clean were most important to them in Q2 15. ONLINE SALES: Online cookware sales were up 30 percent in Q2 15, comprising one-fifth of total cookware sales. FEATURES: In Q2 15, unit sales of ceramic/glass-ceramic bakeware declined by 17 percent, compares to Q2 14. GIFTING: Dollars spent on cutlery purchased for someone else increased by double digits in Q2 15 versus IMPULSE: More than half of cutlery purchases in Q2 15 were unplanned purchases. Source: The NPD Group 4

5 COOKING/KITCHEN: Cookware, Bakeware, Cutlery Quarter Three 2015 TOTAL COOKING/KITCHEN 6 months ending September 2015 CUTLERY AGE Percentage purchased by head of household age $727,024 19% 20% 17% 18% 17% 9% FEATURES: In Q3 15, plastic food storage, which represented 60 percent of total food storage sales, grew by 8 percent compared to the prior year. PURCHASE MOTIVATORS: When it comes to selecting bakeware, consumers said price, easy to clean and brand were most important to them in Q3 15. ONLINE SALES: Nearly one-fourth of cookware dollar sales in Q3 15 were from online purchases, gaining 7 share points compared to Q3 14. PRICE SEGMENTATION: In Q3 15, unit sales of entertaining gadgets priced above $5 increased more than 20 percent, representing nearly 20 percent of total gadget sales. GIFTING: In Q3 15, 18 percent of cutlery was purchased as a gift, a 3 percentage point decline from the prior year. IMPULSE: Nearly half of cutlery purchased in Q3 15 were unplanned purchases. 5 Source: The NPD Group

6 Small Appliances: KITCHEN ELECTRICS Quarter Two 2015 COOKING & SPECIALTY ELECTRICS FOOD PREP/ BEVERAGE $721,422 TOTAL KITCHEN ELECTRICS $1,211,465 17% 6 months ending June 2015 COUNTERTOP BLENDER AGE Percentage purchased by panel member age 18% 16% 17% 16% 16% $490, FEATURES: Unit sales of programmable slow cookers grew 23 percent in Q2 15 versus the prior year, comprising more than one-fourth of total units. PURCHASE MOTIVATORS: When it comes to selecting a blender, consumers said price, good value and easy to use were the top motivators in Q2 15. ONLINE SALES: 40 percent of dollars spent on mixers in Q2 15 were from online purchases. PROMOTION INFLUENCE: During Q2 15, half of the toaster ovens purchased were on sale. IMPULSE: During Q2 15, more than one-third of mixer purchases were unplanned. Source: The NPD Group 6

7 Small Appliances: KITCHEN ELECTRICS Quarter Three 2015 Price Segmentation 3 months ending September 2015 COOKING & SPECIALTY ELECTRICS FOOD PREP/ BEVERAGE $762,689 TOTAL KITCHEN ELECTRICS $1,214,734 $25 - $ % TOASTERS PRICE Percentage purchased by price $50 - $ % $452,045 Under $25 77% FEATURES: More than half of toaster ovens sold in Q3 15 were convection, a 6 percentage point gain from the prior year. PURCHASE MOTIVATORS: When it comes to selecting a juice extractor, consumers said price, features and consumer ratings of this brand were the top motivators in Q3 15. ONLINE SALES: Half of all electric kettle sales in Q3 15 came from online purchases. PURCHASE INFLUENCE: During Q3 15, two-thirds of the breadmakers purchased were on sale, a 2 percentage point decline from Q3 14. IMPULSE: 75 percent of all blenders sold in Q3 15 were planned purchases. 7 Source: The NPD Group

8 Small Appliances: PERSONAL CARE Quarter Two 2015 TOTAL MARKET 6 months ending June 2015 SPECIALTY STYLERS INCOME Percentage purchased by household income HAIR CARE/ GROOMING ORAL CARE, HOME HEALTH, & OTHER PERSONAL CARE $884,713 $1,469,931 $75, % LESS THAN $45,000 41% $585,218 $45,000 - $74,999 25% GIFTING: Nearly one-fifth of massaging appliances sold in Q2 15 were purchased as a gift for someone else. PURCHASE MOTIVATORS: When it comes to selecting a hair dryer, consumers said price, brand and good value were the top motivators in Q2 15. PURCHASE BEHAVIOR: One-third of curling iron/styling appliances sold in Q2 15 were not first-time purchases. PRICE SEGMENTATION: Half of rechargeable electric toothbrushes purchased in Q2 15 were priced between $25 and $49.99, 4 points lower compared to the prior year. IMPULSE: 30 percent oral care appliances sold in Q2 15 were unplanned purchases. ONLINE SALES: During Q2 15, one-fourth of dollars spent on oral care appliances were from online purchases. Source: The NPD Group 8

9 Small Appliances: PERSONAL CARE Quarter Three 2015 TOTAL MARKET 6 months ending September 2015 HAIRDRYERS INCOME Percentage purchased by household income HAIR CARE/ GROOMING ORAL CARE, HOME HEALTH, & OTHER PERSONAL CARE $889,600 $1,491,866 $75, % Less than $45,000 38% $602,266 $45,000 - $74,999 21% FEATURES: More than half of lighted mirrors sold in Q3 15 had 3x 5x magnification, a 21 percent increase from Q3 14. PURCHASE MOTIVATORS: When it comes to selecting a specific curling iron/styling appliance, consumers said price, brand and easy to use were the top motivators in Q3 15. ONLINE SALES: Only 13 percent of shower head sales in Q3 15 were from online purchases. PRICE SEGMENTATION: Approximately three-fourths of the hairdryers sold in Q3 15 were priced less than $25, down 3 percentage points from last year. IMPULSE: Half of all massaging appliances sold in Q3 15 were unplanned purchases. 9 Source: The NPD Group

10 Small Appliances: FLOOR CARE Quarter Two 2015 TOTAL MARKET $1,028,218 6 months ending June 2015 DEEP CARPET CLEANERS AGE Percentage purchased by panel member age 19% 17% 20% 19% 15% 11% FEATURES: 20 percent of hand vacuums sold in Q2 15 were cordless, 2 points higher than in Q2 14. PURCHASE MOTIVATORS: When it comes to a selecting a stick vacuum, consumers said brand, price and good value were the top motivators in Q2 15. ONLINE SALES: More than one-third of canister vacuums sold in Q2 15 were purchased online. PROMOTION INFLUENCE: 70 percent of robotic vacuums sold in Q2 15 were purchased on sale. CHANNEL PERFORMANCE: During Q2 15, one-third of upright vacuum sales were from the mass merchant channel, 5 points higher compared to Q2 14. Source: The NPD Group 10

11 Small Appliances: FLOOR CARE Quarter Three 2015 TOTAL MARKET 6 months ending September 2015 HAND/STICK VACUUMS INCOME Percentage purchased by head of household income $1,022,388 14% 14% 15% 17% 11% 11% 11% 7% Under $15,000 $15,000- $29,999 $30,000- $44,999 $45,000- $59,999 $60,000- $74,999 $75,000- $99,999 $100,000 - $149,999 $150,000+ FEATURES: Dollar sales of upright vacuums with fold-away handles declined by nearly 50 percent in Q3 15 compared to the year before, accounting for less than 10 percent of market share. PURCHASE MOTIVATORS: When it comes to a selecting a deep carpet cleaner, consumers said brand, price and features were the top motivators in Q3 15. ONLINE SALES: More than 40 percent of robotic vacuums sold in Q3 15 were purchased online. PRICE SEGMENTATION: Canister vacuums priced less than $50 was the only segment that showed growth in Q3 15. PROMOTION INFLUENCE: Nearly half of stick vacuums sold in Q3 15 were purchased on sale. 11 Source: The NPD Group

12 Home: KITCHEN & DINING TEXTILES Quarter Two 2015 TOTAL MARKET 6 months ending June 2015 TABLE LINENS INCOME Percentage purchased by head of household income $277,204 30% 19% 15% 9% 10% 7% 11% Under $15,000 $15,000 29,999 $30,000 44,999 $45,000 59,999 $60,000 74,999 $75,000 99,999 $100,000 + FEATURES: During Q2 15, 25 percent of dollars spent on table linens were on light, solid-color products. PURCHASE MOTIVATORS: When it comes to selecting table linens, consumers said appearance, price and material/texture were most important to them in Q2 15. ONLINE SALES: Online sales of kitchen linens grew double digits in Q2 15 compared to Q2 14. DEMOGRAPHICS: 20 percent of table linen dollar sales in Q2 15 came from products purchased by males. SPECIAL OCCASION: Less than half of table linens purchased in Q2 15 were on sale. Tracking Source: The NPD Group 12

13 Home: KITCHEN & DINING TEXTILES Quarter Three 2015 TOTAL MARKET 6 months ending September 2015 KITCHEN LINENS AGE Percentage purchased by head of household age $272,845 20% 18% 18% 21% 14% 9% FEATURES: During Q3 15, one-third of dollars spent on kitchen linens were on pattern or print products. PURCHASE MOTIVATORS: When it comes to selecting kitchen linens, consumers said appearance, price and material/texture were most important to them in Q3 15. ONLINE SALES: Less than 10 percent of kitchen linen sales were from online purchases in Q3 15. DEMOGRAPHICS: 20 percent of kitchen linen dollar sales in Q3 15 came from products purchased by men, a 5 percentage point decline compared to Q3 14. SPECIAL OCCASION: One-third of kitchen linens were purchased on sale in Q Source: The NPD Group

14 Gadget Obsession & Opportunity continued from page 1 Practicality is paramount in the world of gadgets but there is also real opportunity in the impulse potential of kitchen gadget purchases for manufacturers and retailers. Consumers may not need that gadget with the brightly colored handle, but they love the color or it performs a mundane task in a fun and easy way, and it s not expensive, so they drop it in their basket. Kitchen gadget purchases are almost fun; they are carefree, harmlessly addictive, have a sense of style and give the consumer the ability to make a statement about who they are. One more pretty, polka-dot prep bowl in the cabinet won t hurt anyone, but it will look great when it is on the counter; and that cool slicing tool won t take up much space in the drawer, but I will look like a pro when I m preparing a meal. More than one application Gadget sales growth certainly signals opportunity for the category, but it also serves as an indicator of consumer behavior and opportunity for other categories and industries. One example is the current top segment in terms of growth rate, entertaining gadgets related to beverages, and this could be good news for the beverageware category. In general, consumers who entertain will spend on products that enhance the experience they are creating for their guests. A focus on entertaining may also mean consumers are spending more time at home, doing more cooking and also splurging on purchases for the home because they are saving money by not going out. Add in the focus on healthy lifestyles and homemade meals and the opportunity reach suggested by growth in gadgets goes even further. There is constant innovation in kitchen gadgets as suppliers continue to design and market simple, new and exciting products. Consumers are hungry for the same kind of newness and innovation when they are shopping for everything from a vegetable peeler or blender to cookware or sheets. That innovation could be as simple as a new color or as complex as a specialized feature. As mentioned earlier, recent gadget sales performance shows that consumers see the charm in the essentials and the extras and they are spending for it. For more information, contact Joe Derochowski at Source: The NPD Group 14

15 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 prerecruited 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 U.S. population. Each month, over 200,000 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. 15 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 guides 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 Joe Derochowski, Contributing Editor Janine Marshall-Bolton, Contributing Editor Tom Goodman, Design Published by IHA For more information, contact Debbie Teschke at ; or dteschke@housewares.org 6400 SHAFER COURT, STE. 650 ROSEMONT, IL USA TEL: FAX: Source: The NPD Group