By David Gill
There are reasons for the manufacturers of kitchen and personal-care appliances to look forward to 2010.
First, the shaky economy has actually provided a boost to sales of these products by keeping consumers home. The results from a recent Harris Poll indicates that this behavior will continue even as the economy emerges from its funk. Two-thirds of those surveyed in this study, which took place from Sept. 8 to Sept. 15, said they will slim down their spending on restaurants and entertainment.
To housewares executives, this means that the money shoppers will spend will go toward items that help them entertain at home. “Clearly, there are indications that consumers are cocooning more,” said Brian Maynard, director of brand marketing at KitchenAid. “Cookbook sales are up, along with certain aspects of the grocery industry.”
Describing KitchenAid’s current attitude as “cautiously optimistic,” Maynard added that the brand plans to be aggressive in introducing new products when 2010 arrives. “We believe that next year, there will be some form of recovery,” he said. “The question is, how strong will it be? Our guess is that it will be slow.”
Still, some executives remain cautious because the recession has transformed consumer spending patterns—perhaps for the long haul. “Even though the economy is showing signs of recovery, consumers won’t flex themselves into their old spending habits,” said Lori Gonzalez, vice president of marketing for Jarden Consumer Solutions. “They’re more practical and doing more research into their purchases. They want to be practical about what they buy, and they want good value.”
But this more cautious approach by consumers could provide some fuel to electrics sales.
“Consumers will buy appliances based on their situation,” Gonzalez said. “We see this as a positive because people are staying at home and entertaining more at home. They may invest $50 in a small appliance and then they’ll see what that appliance can do for home entertaining. We believe that 2010 will be a positive story for small appliances, especially for those brands with great practical appeal like our Oster and Crock-Pot brands.”
Noting that the outlook next year is unclear at this time, Francesco De Flaviis, marketing director for De’Longhi USA, said, “I guess all manufacturers are looking at the fourth quarter (of 2009) for some indicators. For sure, we expect a slow start, but we expect a better first quarter in comparison to the first quarter of 2009.”
Vendor executives have cited innovation as the key to the industry’s growth. Regarding next year, De Flaviis said, “I think novelty is and will continue to be the growth driver for the near future.” Innovations make small electrics “an ever-growing segment,” said Jennifer Park, marketing communications manager for Fagor America. “I’ve seen a visible increase particularly in the slow-cooker, electric pressure-cooker and rice-cooker categories.” Park said companies are equipping products such as rice cookers with extra features that expand the range of uses for the products.
Innovation is seen as a crucial factor to next year’s sales growth in personal-care appliances as well.
“A couple of big drivers will continue to be the development of technology that translates into easier styling at home,” said Fred Koeller, vice president of marketing at Andis. Another opportunity for this segment is “products that represent a strong benefits-to-price value. We also see the home hair-cutting category continuing to remain strong in 2010, with higher-priced professional-grade kits selling especially well.”