Researcher finds strong interest in HDTV set purchases in next six months

December 18, 2007

Nearly a third of households that don’t own an HDTV are interested in purchasing an HD set in the next six months, according to new research from The Diffusion Group.

The research also indicates that unlike early buyers of HDTV sets, this new wave of buyers more closely matches the demographic mix of the typical mainstream electronics buyer. Specifically, the new research finds that these “HDTV intenders,” as The Diffusion Group calls them, tend to be younger, more ethnically diverse and have lower annual household incomes than existing HDTV owners.

According to Michael Greeson, president of The Diffusion Group, the characteristics of these HDTV intenders suggests that in the battle over high-def DVD formats, HD-DVD may hold an advantage over Blu-ray. Among this group, of those who plan to buy a high-def DVD, 43 percent prefer HD-DVD, 27 percent prefer Blu-ray and 30 percent are undecided.

Two factors seem to give the HD-DVD format an advantage among this group: lower price and the name “HD-DVD.” In Greeson’s view, the mainstreaming of the HDTV marketplace introduces greater price sensitivity to the HD equation than when it was dominated by well-heeled early adopters. Thus, the lower retail price of HD-DVD players is an important factor in the purchasing decisions of HDTV intenders, he said. Additionally, Blu-ray suffers from a naming disadvantage in the minds of HDTV intenders because it is not evident from the word ”Blu-ray” that the format plays HD entertainment.

However, the outcome of the format war is far from clear because of the 30 percent that say they are undecided, Greeson said. Marketing efforts from the Blu-ray camp to explicitly pair the terms “HD” or “high definition” with “Blu-ray” (as in Blu-ray high definition or Blu-ray HD) may change the equation, he said. Equally important will be whether Blu-ray player vendors will be price competitive.

Editor’s note: Read an interview with Michael Greeson in this issue’s Sound Off.

For more information, visit www.thediffusiongroup.com.

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