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Generation Y changing US houseware market: The lack of brand loyalty opens door to new competition, products
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Generation Y changing US houseware market: The lack of brand loyalty opens door to new competition, products

The US Generation Y, the popular demographic label for individuals born between 1979 and 1994, represents quite a different buying group than their baby-boomer parents (those born between 1946 and 1964). The 60 million-plus members of Generation Y are more diverse racially, more likely to grow up in a single-parent household and more likely to have a working mother.

Generation Y presents both a challenge and an opportunity for today’s home-goods manufacturers, marketers and retailers. As brand loyalty is not considered a strong trait among the majority of Generation Y consumers, companies that once held a competitive edge based solely on their brand portfolios are likely to feel pressure from new companies rolling out products popular with Generation Y’ers.


Price, features, colour and more colour motivate Generation Y

Price and features were the leading purchase motivators for Generation Y’ers who purchased small appliances in the US in the 12 months ended June 2004, according to NPD Houseworld consumer data.

Compared with the Baby Boomers, Generation Y’ers are not yet set in their ways of doing things, and they are seeking out first-time products that represent their individuality, in terms of colour, style and/or design.

They also are likely to be attracted to “smart” and “green” appliances and housewares that make their hectic lives easier with products in affordable price ranges.

Given the age range between the youngest and oldest member of Generation Y, it is fair to say that this group of consumers impacts each industry differently. In the appliance and houseware realm, it is the older Generation Y demographic that is influencing new products brought to the market. The Generation Y impact can be seen in purchases of personal-care items, such as shavers and hairdryers, dormitory-room products, bridal registries and furnishings for a first apartment or home.

In personal-care products, Generation Y trendsetting is evident in hair crimpers and straighteners. In kitchen electrics, this group gravitates towards colour, colour and more colour.

Generation Y consumers also respond differently to marketing efforts than earlier generations. Bombarded by product advertisement since birth, these customers are ignoring print and TV ads that boast image and celebrity — and are more apt to respond to ads that incorporate irony and humour. As a marketing medium, the Internet has become as effective — if not more — in targeting this consumer than print and TV.


Full impact of Generation Y not yet felt

While we see some Generation Y consumers in the marketplace, the industry has yet to feel its full impact; only the older segment of this demographic is purchasing appliances and housewares, while the majority are yet to evolve into full-fledged consumers.

For example, Generation Y consumers accounted for less than 20% of total small-appliance sales and less than 10% of major-appliance sales during the 12 months ended June 2004. In the curling iron and brushes category, however, this group owned nearly 30% of market share, 30% in lighted mirrors, and upwards of 20% in fans, heaters and men’s shavers.
Do “real men” buy home goods? Where do they shop?

The concept of marketing machismo — how men in the US are changing retail and vice versa — has yet to become a reality in the major-appliance, houseware and small-appliance industries.

Men purchased 35.3% of total small-appliance units during the 12 months ended May 2004, virtually unchanged from the comparable year-before period. In major appliances, it was similar: Men accounted for 46.9% of total purchases during the 12 months ended May 2003, and 46.3% for the same period concluding May 2004.

Men, like women, continue to heavily shop at mass merchants for small appliances. For major appliances, men showed an affinity for general merchandise and home-improvement stores. Home improvement — a channel long dominated by men — is the sole segment in which marketing machismo does have a strong influence on retail.

Women continue to dominate the purchasing of housewares, attributed in large part to bridal registries, but some manufacturers are reporting a slightly more male involvement.



Other Housewares MarketWatch highlights

Housewares MarketWatch also includes US data on various categories of small appliances (kitchen, personal-care, floor-care and household electrics) and non-electric houseware (cookware, bakeware, beverageware, cutlery and flatware) from NPD Houseworld (www.npdhouseworld.com), the home-products tracking division of The NPD Group, a global sales and marketing information provider.

Highlights include:

The 45-54 age demographic purchased 19.7% of indoor electric grills during the first six months of 2004, although the demographic group represents just 14% of the population. At the same time, 25- to 34-year-olds, representing 13.7% of the population, accounted for 18.9% of sales.
Two-person households, representing 26.1% of the population, accounted for 35.2% of hand-mixer sales for the six months ended June 2004 —nearly double the sales to any other household size.
Multi-purpose beard and moustache trimmers accounted for half of all trimmers sold during the second quarter of 2004, while nose/ear trimmers accounted for 20.4%; 13.2% of oral-care appliances sold were flossers.
Half of all water filtration devices sold in the second quarter were pour-through appliances, and an impressive 75.7% of all upright vacuums sold were bagless.
In non-electric houseware, 31.3% of all beverageware sold in the second quarter were highball/tumblers, and 45.2% of cutlery units sold had plastic handles.

This article is reprinted with permission from the International Housewares Association (IHA), the 66-year-old voice of the houseware industry, which accounted for US$283 billion at retail worldwide in 2002.

The not-for-profit, full-service association sponsors the world’s premier exposition of products for the home, the International Home & Housewares Show, and offers its 1,700 member companies a wide range of services, including industry and government advocacy, export assistance, state-of-the-industry reports, point-of-sale and consumer panel data through Housewares MarketWatch, executive management peer groups, a unique Web-based community at www.housewares.org and group-buying discounts on business-solutions services.

The International Home & Housewares Show 2005 will be held at McCormick Place, Chicago, Illinois, USA, 20-22 March 2005.

*NPD Houseworld, a division of The NPD Group, provides sales and marketing information for manufacturers and retailers in the home appliances, houseware and home improvement industries. It provides market intelligence available for these industries, showing what is selling, where, to whom and why.

Editor’s Note: Although this report is focused on the US market, these trends are also reflected in some of the fast-growing consumer markets across the Asia-Pacific, many of which have a young-generation base.

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