winter 2008 consumers are going green · eco-friendly or going “green.” scientific research...

that more carbon dioxide is nowin the atmosphere than has beenin the past 600,000+ years.Increased awareness has madeterms such as global warming,carbon footprint and energy effi-ciency a part of our standard ver-nacular, and rightfully so as theplight of our environment is a realtime concern for current andfuture generations.

According to a recent con-sumer survey by The NPD Group,70 percent of people surveyed saidthat it is very important or some-what important that the majorappliance products they purchasebe environmentally friendly.Additional categories that rankedhigh in importance among con-sumers included home lighting(62 percent), home paint (59 percent), home carpet andflooring (47 percent) and smallappliances (41 percent).

Interestingly, when we lookat importance of environmental-ly friendly products by age, thedata skews to the older segmentsof the population. Across all product cate-gories, the 45+ crowd consistently rated theimportance of environmentally friendly prod-ucts higher than their younger counterparts.This is somewhat surprising considering thelong-term implications of global warming arelikely to have a greater impact on the youngergenerations than the older ones.

Willing to Pay MoreThe importance of environmentally friend-

ly products also skews highest among those inlower-income brackets for most product cate-gories, including small appliances, home

paint, home lighting and home carpet andflooring. What this may be telling us is thatwhen consumers think of “green” products,the long-term cost savings associated withprograms such as Energy Star come to top ofmind, perhaps even more so than environ-mental benefits. If this is the case, it helps toexplain why we see environmental interest atits highest among those on a fixed income,such as seniors, or on the lower end of theincome scale.

Similar findings were noted in response tothe question, “How likely would you be to

Winter 2008

®

About Housewares MarketWatchHousewares MarketWatch reports

both point-of-sale (POS) and consumerdata from NPD databases. The quarterlydata covers various product categorieswithin the divisions of Small Appliancesand Non-electric Housewares.

The information contained on the following pages is offered as a snapshotof a category’s performance, both fromthe retailer (POS) and consumer perspectives. The POS data covers theretail channels of mass/national chains,department store, specialty store and drugstore (personal care and homeenvironment only). Each issue ofHousewares MarketWatch will featureseveral categories from the SmallAppliances and Housewares divisions.

Complete data on a category can bepurchased by visiting NPD’s website atwww.npd.com.See the Data andMethodology section on page 8 for anexplanation of how the data is compiled.

Past issues of Housewares MarketWatchhave dealt extensively with small appli-ances and housewares, reporting on

market conditions and emerging trends. Inthis issue, our primary focus will be on themajor appliance and home improvementindustries and one of the hottest topics cur-rently impacting these sectors—the concept ofeco-friendly or going “green.”

Scientific research tells us that the earth asan ecosystem is changing, attributable in greatpart to the effects of globalization. It is said

Consumers Are Going GreenBy Peter Goldman, The NPD Group, Inc.

continued on page 6

70 percent of people surveyed said that it is important that themajor appliance products they pur-chase be environmentally friendly.

■ More than half of all handmixers sold in Q3’07 had6-9 speeds.

Source: Retail Tracking Service

HAND MIXERS

■ 19% of all toaster ovens sold inQ3’07 were toaster oven/broilerwith convection.


TOASTER OVENS

■ More than 15% of allblenders sold in Q3’07had touch pad controls.


BLENDERS

2Source: The NPD Group

MARKET SIZEQUARTER THREE • 2007UNIT VOLUME IN THOUSANDS

Small Appliances: KITCHEN ELECTRICSTO

TAL

MARKET

COOKI

NGEL

ECTR

ICS

FOOD P

REP/

BEVER

AGE

Source: Consumer Tracking Service

21,608

9,062

12,546

STAND MIXER • AGE OF BUYERPercentage purchased by age of buyer versus census

DEMOGRAPHIC ANALYSISUnit Volume Share

6 months ending — September 2007


13 – 17years

18 – 24years

25 – 34years

35 – 44years

45 – 54years

55 – 64years

65 years +

ELECTRIC CAN OPENER • BUYER GENDERPercentage purchased by buyer gender versus census

Source: Consumer Tracking ServiceMale

9.0

%

5.8

%

11.7

%

22.0

%

16.8

%

19.3

%

17.2

%

15.0

%

11.7

%

14.7

%

0.6

%

STAND MIXER

CENSUS (PERCENT OF POPULATION)

ELECTRIC CAN OPENER


22.1

%

18.9

%

Female

33.1

%

48.9

%

66.9

%

51.1

%

15.1

%

■ Brush heads represent 97% ofall oral care replacementparts sold in Q3’07.


ORAL CAREREPLACEMENT PARTS

■ Body groomers represented 4% ofmen’s trimmer unit sales in Q3’07.


MEN’STRIMMERS

TOTA

LMARKE

T

HAIR C

ARE/

GROOMING ORAL C

ARE

& OTH

ER

PERSO

NAL CARE


48,137

21,258

26,879

3 Source: The NPD Group

Small Appliances: PERSONAL CARE


MASSAGING APPLIANCES • BUYER GENDERPercentage purchased by buyer gender versus census




Male

HAIRDRYERS • INCOMEPercentage purchased by income versus census


Under$15,000

34.8

%

11.1

%

$15,000 –29,999

14.6

%

$30,000 –44,999

11.4

%

$45,000 –59,999

16.1

%

$60,000 –74,999

15.1

%

$75,000 –99,999

16.6

%

$100,000 –149,999

13.7

%

11.7

%

$150,000 +

11.5

% 13.2

%

11.3

%

8.0

%

17.5

%

6.5

%7.9

%

HAIRDRYERS


MASSAGING APPLIANCES


Female

48.9

%

65.2

%

51.1

%

■ 40% of all personal wellnessitems sold in the third quarterof 2007 included sound as asensory experience.


PERSONALWELLNESS

13.9

%


TOTA

LMARKE

T

23,787



Small Appliances: HOME ENVIRONMENT(EXCLUDING VACS)

AIR PURIFIERS • HOUSEHOLD SIZEPercentage purchased by household size versus census




Single Member Two Members Three Members Four Members Five or MoreMembers

AIR PURIFIERS • REGIONPercentage purchased in region versus census


MiddleAtlantic

East NorthCentral

West NorthCentral

NewEngland

SouthAtlantic

East SouthCentral

West SouthCentral

Mountain Pacific

11.6

%

10.3

%

24.2

% 26.3

%

25.2

%

19.3

%

22.6

%

19.2

% 21.4

%

19.8

%

4.9

%

14.1

% 15.9

%

12.1

%

10.8

%

9.9

%

6.5

%

6.8

%

4.2

% 6.0

%

6.6

%

11.3

%

18.6

%

25.6

%

15.7

%

10.2

%

15.9

%

4.7

%

AIR PURIFIERS


AIR PURIFIERS


■ 38% of heaters sold in Q3’07 usedceramic heat technology.


HEATERS

STICK VACUUMS



TOTA

LMARKE

T

8,267

5 Source: The NPD Group

Small Appliances: FLOOR CARE


STICK VACUUMS • AGE OF BUYERPercentage purchased by age of buyer versus census



Source: Consumer Tracking Service18 – 24 years 25 – 34 years 35 – 44 years 45 – 54 years 55 – 64 years 65 years +

STICK VACUUMS • REGIONPercentage purchased in region versus census


MiddleAtlantic

East NorthCentral

New England West NorthCentral

SouthAtlantic

East SouthCentral

West SouthCentral

Mountain Pacific

1.2

%

9.0

% 10.2

% 11.7

%

15.2

% 16.8

%

16.7

% 18.9

%

18.2

%

17.2

%

17.9

%

20.5

%

11.7

%

14.7

%

4.9

%

17.9

%

14.1

%

14.0

% 15.9

%

4.2

% 6.0

%

10.2

%

11.3

%

5.7

%

23.7

%

6.6

%

13.0

%

5.4

%

15.7

%

6.0

%

STICK VACUUMS


13 – 17 years

6.8

%

■ 75% of deep carpet cleaners sold in Q3’07 had power brush headconfiguration.


DEEP CARPETCLEANERS

18.6

%

pay more for environmentally friendly prod-ucts?” In most instances, the older the con-sumer, the more likely he or she would bewilling to pay extra for these products. Thesame holds true where income is concerned;consumers earning less than $60k were morelikely to say they would be very likely orsomewhat likely to pay more for eight of the11 product categories listed compared tothose earning above that mark.

In today’s society, we would expect to seemore consumers honing in on the idea ofeco-friendly or “going green.” However, asthe data suggests, consumer sentiments areclearly stratified by age and incomeand, perhaps, motivation as well.When consumers are asked in theirown words to tell manufacturers andretailers their sentiments towardenvironmentally friendly products,two themes emerged: cost concernsand “healthy” skepticism over thevalidity of eco-friendly.

According to the verbatimresponses, there is an overwhelmingfeeling that not only are “green”products overpriced, but that manu-facturers and retailers may be takingadvantage of the popularity of“green” and in some instances,unfairly passing along increased coststo improve their own financial mar-gins. Some consumers say that theywant to “do the right thing” by pur-chasing eco-friendly products butsimply can not afford to pay substan-tially more especially in the currenteconomic climate. While lower-income consumers show the greatestwillingness to pay more for suchproducts, it is interesting to see thisconcern come up as prominently as itdoes.

Skepticism AboundsAs for skepticism, the verbatim

responses reveal that consumers arequestioning how something could belabeled eco-friendly but packaged in

styrofoam or plastic packaging that is knownto have long-term repercussions on the envi-ronment. Additional issues such as outsourc-ing, cheap labor and public corporate com-mitment to the environment are also beingcalled into question.

Although there seems to be mixed emo-tions around the idea of buying eco-friendly,we can certainly applaud our industries forthe inroads they have made to address theenvironmental crisis. The Energy Star pro-gram, for example, can be considered one ofthe earliest initiatives undertaken by the majorappliance and home improvement industries

■ Items that had stoneware/claystone as their primary materialaccounted for 5% of dollarsales in Q3’07. Source: Retail Tracking Service

BAKEWARE


FLATWARE

DINNERWARE

BEVERAGEWARE

COOKWARE

BAKEWARE

CUTLERY

FLATWARE


Housewares: NON-ELECTRIC

Consumers Are Going GreenContinued from page 1


12,5

73

8,31

2

4,24

2

3,61

4

2,33

1

1,98

3


The importance of environ-mentally friendly products is highest among those inlower-income brackets forproduct categories, including:

small applianceshome painthome lighting home carpet flooring

■ 46% of all cookware dollarsales in Q3’07 came fromopen stock items.


COOKWARE

■ Place settings represented 21% of flatware dollarsales in Q3’07.

to address the problems of global warming.Dating back to 1992, the Energy Star pro-gram arose through a joint partnershipbetween the U.S. Department of Energy andthe U.S. Environmental Protection Agency asa voluntary labeling program designed toidentify and promote energy-efficient prod-ucts. Computers and monitors were the firstproducts to bear the Energy Star label, andsince then the list has grown to include majorappliances, home improvement products,home electronics and many more.

According to NPD point-of-sale informa-tion, 93 percent of dishwashers, 42 percent ofwashing machines and 31 percent of refrigera-tor units sold in the 12 months ending

September 2007 wereEnergy Star qualified.In the home improve-ment category, nearlyhalf (45 percent) of allinterior lighting pur-chases made in the yearending September 2007were Energy Star quali-fied, according to NPDHome Improvementconsumer information.

Just about as many consumers who said theirpurchases were Energy Star qualified said theywere unsure (42 percent).

Green Living on a Larger ScaleIn the future, we hope that further aware-

ness of the benefits of the Energy Star pro-gram, including lower utility bills and reduc-tion of greenhouse gasses, will encourageconsumers to consider this program a criticalpart of their decision making for select majorappliance and home improvement purchases.

The development and distribution ofEnergy Star qualified products is just oneexample of how manufacturers and retailers

are taking steps toward creating sustainableeco-friendly products. Consumers can find arange of products in nearly every home cate-gory that enable green living on a larger scale.Reclaimed wood for flooring and furniture,paper-based countertops, organic cotton bathtowels and bedding ensembles, low-volatileorganic paints and recycled glassware offerjust a glimpse of what is currently available toconsumers.

In the coming years, we can expect theassortment of eco-friendly products to contin-ue to grow as the peril of our environmentand the necessary measures needed toimprove it continue to take center stage.However, while the cause is certainly great,manufacturers and retailers need to keep inmind that there is still a good deal of con-sumer apprehension when it comes to makingthe leap to eco-friendly. From fears of over-paying to skepticism of the true benefits ofsuch products, it is clear that much needs tobe done to educate the consumer. With thisin mind, awareness, trust building and infor-mation sharing should remain a top priorityfor all engaged in “green” businesses.

H O U S E W A R E S

®

Categories that ranked high in importance among consumers:

62% home lighting 59% home paint47% home carpet and flooring41% small appliances


H O U S E W A R E S

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ABOUT THE NPD GROUP, INC.

The NPD Group, Inc. (NPD) is a glob-al market information company thatmeasures product movement and con-sumer behavior across a broad rangeof industries -- apparel, automotiveproducts, consumer electronics, cosmet-ics and fragrances, food, foodservice,footwear, housewares, information tech-nology, interactive entertainment, toysand music. NPD's clients, many in theFortune 500, use this insight to uncovermarket opportunities, strengthen chan-nel relationships and benchmark indus-try performance. Since 1967, NPD hasintroduced numerous industry firsts,most recently combining and calibratinginformation from consumer panels andpoint-of-sale tracking via its flagshipservices, the NPD Worlds. The firm hasoffices and affiliations in 60 countries.For more information on The NPDGroup, visit www.npd.com.

I N T E R N A T I O N A L H O U S E W A R E S A S S O C I A T I O N

6400 SHAFER COURT, STE. 650ROSEMONT, IL 60018 USATEL: 847-292-4200 FAX: 847-292-4211www.housewares.org

091707B/11.5M

DATA ANDMETHODOLOGY

NPD has a standard data model that is usedfor all categories, although it is modified tosuit the needs or characteristics of each. Thestandard model incorporates both consumerand point-of-sale (POS) databases. These twodata sources are highly complementary andare used to support one another-each makingthe other stronger.

Point-of-Sale (POS) databases are assem-bled from retailers' records of actual sales byproduct as collected at the cash register.These databases are highly reliable and pro-vide census counts of sales by product andprice for participating retailers. Not all retail-ers participate, however, so informed esti-mates are made for product sales in non-par-ticipating retailers in a process called "projec-tion" or "POS projection." The completedsales data are valuable to clients trying tounderstand which products or items are sell-ing well and which are not, at which pricesand in which channels. The finished POS datadescribe the product, retail channel and price.They do not, however, address the buyer ofthe product.

Consumer databases are developed usingproduct purchase surveys completed by alarge-scale rotating sample of consumers.These data also produce estimates of sales byproduct and retail channel, as does a POSdatabase. More importantly, however, theconsumer surveys capture information abouteach purchase not available in the POS data-bases, buyer demographics, the product'sintended use and a variety of other character-istics. These facts help clients understand whyproducts are selling well or poorly and helpthem better understand consumers' motiva-tions. One additional advantage to the con-sumer surveys is that there are no "missingretailers" from the database since the informa-tion is gathered from panelists directly and noretailer cooperation is required.

CONSUMER METHODOLOGYMost consumer data in the U.S. are gath-

ered from periodic samples of individuals whoare asked about their recent purchases.Respondents report certain details about thetype and nature of their purchases in a survey

administered via the Web. The respondingsample is demographically weighted and pro-jected through a series of steps to representthe Total Adult (18+) and Total Teen (13-17)U.S. population.

Each week, over 145,000 individuals areselected from the NPD online consumerpanel to participate in one of three weeklystudies. The NPD online consumer panel iscomposed of pre-recruited individuals whohave agreed to participate in NPD online sur-veys and have completed a comprehensivedemographic questionnaire. The use of anestablished online panel assures good cooper-ation levels and predictable demographic bal-ance among cooperators.

Most survey work is completed via theInternet. Internet users are known to havecertain demographic and behavioral biases notfound in the total population, though theseare rapidly diminishing over time. A processof sample selection and respondent weightingis used to control demographics, however,reducing some of the biases in the sample.Extensive research has shown that by effec-tively weighting the sample, the Internetyields superior data quality (coverage) than dooffline methodologies.

POS METHODOLOGYNPD collects point-of-sale retailer data

from selected retailers. These data are theactual sales for the chain on an SKU-by-SKUbasis. The data are combined with data fromother retailers to produce reports on certaincategories by channel, where a sufficientnumber of retailers are cooperating and wheresufficient market demand exists for the data-base.

Data are not available from all retailers,however. The available data are projected tocover the missing (non-cooperating) retailerswithin each channel in most of NPD's cate-gories. In certain circumstances, brand shareweights are applied as well to compensate formissing retailers with a different brand mix,to more accurately reflect the marketplace.Those adjustments are generally guided byinputs from either consumer panel data oractual in-store audits.

Deborah A. Teschke, Senior EditorPeter Goldman, Contributing EditorNicolle Levy, Contributing EditorTom Goodman, DesignPublished by IHA

For more information, contact Debbie Teschke at 847-692-0110; [email protected]

H O U S E W A R E S

winter 2008 consumers are going green · eco-friendly or going “green.” scientific research...

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