Following record growth due to the pandemic boom, widespread inflation is beginning to significantly impact growth across the home audio market. However, according to the latest quarterly tracker from Futuresource Consulting, despite the fall in volumes, market value remains strong.
“Higher price brackets continue to perform well in the home audio space,” says Christopher Bull, Market Analyst, Futuresource Consulting. “That’s partly driven by inflation, but also due to consumers with higher incomes spending more on premium consumer electronics devices. In Q2 2022, home audio value has risen quarter-on-quarter, as well as year-on-year. Yet volumes are painting an ominous picture of the future.”
In global volume terms, this latest round of Futuresource research shows that every product category underwent contraction year-on-year in Q2. In particular, EMEA retreated following heavy inflation in Western Europe, and economic dislocation in Eastern Europe due to the conflict in Ukraine.
The North American and Chinese home audio markets are also beginning to show signs of significant cooldown, due to saturation of their smart speaker markets. Technology brands are also withdrawing from their previously enthusiastic support of the smart speaker market, with few new product launches and smaller orders for stock.
The META region has bucked the trend, with the home audio market enjoying a rise in shipment volumes. Futuresource attributes this to the launch of Alexa and Amazon smart products within the region. At the same time, LATAM has experienced a strong performance from wireless speakers in lower price brackets, spearheaded by market activity from JBL.
“At a global level, we’re seeing a distinct trend beginning to emerge,” says Bull. “Lower-priced home audio products are being compressed by the dual impact of a market cooling from a rush of entry level products during the COVID-19 pandemic, and the escalating cost of living crisis.
“At the same time, sub-$100 products have surrendered market share to the higher brackets, most notably within the $100 to $199 range, which grew six percentage points quarter-on-quarter for Q2. All other higher price segments also performed well, with $500 to $999 gaining a percentage point, and the others either posting marginal growth or holding steady.”
Audio Collaborative 2022 returns to London!
Join us for Audio Collaborative 2022, where we will explore the evolution of audio and embrace the creativity, strategy and development of technology across the entire space. Audio Collaborative brings together delegates from some of the leading companies in the industry, providing sponsors with the opportunity to showcase their brand and products in the presence of an influential audience.
Latest Consumer Electronics Insights