Despite Healthy Interest In Consumer Electronics, Sales Likely To Be Flat This Holiday Season

New York, NY - The surge in demand for home-based consumer electronics is cresting, according to Ipsos-Insight, the global survey-based marketing research firm. After a small peak in demand in 2003, consumers interviewed by the company recently show a receding interest in buying more electronics for the home over the next three months, which includes the upcoming holiday shopping season.

"There is still a healthy interest in replenishing the home with new or replacement items like cell phones and PCs," said Lynne Bartos, a leader with the company's Cable, Media & Entertainment research division. "But momentum in interest of big ticket items like HDTV and home entertainment systems has leveled off."

For the third consecutive year, Ipsos-Insight surveyed a nationally representative sample of 1,000 U.S. adults as they head into the holiday shopping season to determine their likelihood of buying specific electronics over the next three months. This year, the company asked consumers to choose from a list of 18 home electronics items. Among the survey's highlights:

• Interest levels in big ticket entertainment items, such as home theater systems and HDTV, has leveled off after a 5% jump in 2003 - from 15% likely to buy last year to 13% this year. "HDTV has been marketed heavily, and although more consumers are aware of it and understand it, the value proposition just isn't there yet," Bartos said. The same holds for digital video recorders; despite increased exposure of services like TiVo, interest remains flat at 12% vs. 13% in '03.
• Interest in buying new or replacement cell phones is back to 2002 levels at 27% this year, down from 31% in 2003.
• Similarly, about one in four households plans to buy a new PC, on par with 2003 at 25%.
• Digital cameras and DVD players continue to rank among the most popular items, each holding steady at 22%.
• Portable MP3 players show steady but leveled interest at 13% again this year.
• Printer manufacturers are in for good news, as more consumers show interest in buying printers this year than before (18% in 2002 and 2003 vs. 21% in 2004). "The advances in printer, paper, and ink technology, lower prices, and presence of digital cameras has jump started an interest in new printers," said Bartos.
• DVD recorder interest remains relatively high at 18%. "Given the level of interest in other, sexier items, it's surprising this functional product gets this much notice. Consumers may be confusing it with a CD burner," Bartos added.

Americans' Near-Term Purchasing Intentions for Home Technologies* "Thinking of technologies for your household, over the next 3 months, how likely do you think you are to buy each of the following?"

160Source: Ipsos-Insight, 2004

Ipsos U.S. Express Research Methodology These national survey research data were collected via Ipsos U.S. Express, a weekly national omnibus survey. Fieldwork was conducted between October 28 and 31, 2002, October 24 and 26, 2003, and November 3 and 5, 2004. Data are based on 1,000 telephone surveys taken with adults (18+) across the United States using regionally-stratified random sampling. The survey results can be said to be within 177 3.1 percentage points of what they would have been had the entire adult population been surveyed. To ensure that our sample reflects the make-up of the American population, we weight the results to match the latest Current Population Survey provided by the U.S. Census Bureau.

For more information on this release, please contact: Lynne Bartos Senior Vice President Ipsos-Insight, Cable, Media & Entertainment Division 312.665.0556

About Ipsos-Insight Ipsos-Insight, the flagship marketing research division of Ipsos in the U.S., has industry specialists serving companies in the following categories: consumer products; technology and communications; health and pharmaceutical; financial services; cable, media and entertainment; agrifood; energy and utilities; and lottery and gaming. Ipsos-Insight provides custom and tracking research services to domestic clients, as well as U.S.-based multinationals. It offers concept and product testing, package testing, attitude and usage studies, omnibuses, tracking systems, brand equity, price optimization and segmentation, marketing models, advanced analytics, and global research. Ipsos-Insight is an Ipsos company, a leading global survey-based market research group. To learn more, visit: www.ipsos-insight.com.

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