What Display Daily thinks: I am not sure if TVs are sold on a generational basis. Judging by what I saw at CES 2024, Walmart, or Best Buy, TVs are still sold for old people, the kind of who look up channel numbers.
Before you get your thin-films in a twist, I am not talking about the tech or specs of these TVs, but the branding. And, just to be clear, branding is as essential to the product development process in consumer electronics as the tech specs. And here’s the disconnect, I don’t buy that people really care about OLED versus LCD or whatever, that’s just a salad of words that they have to navigate, and if you end-cap every aisle of the TV section of Best Buy with OLEDs then you probably would expect people to aspire to OLED. Let’s forget the fact that most people can’t afford them.
Which leads me to the real crux of the matter, something that I have harped on about on many occasions: the user experience. The common thread of the two distinct surveys below is that the performance and quality of the streaming experience, which DOES include gaming, is of paramount importance in establishing the quality of the TV.
It may not be apparent to some demographics, but it is to Gen X. You want future brand loyalty from the young audience of today, give them fast, efficient, budget TVs with great response times. Brand it for them, target it at them, and try and sell TVs to people who are not looking up dad bod tees on Instagram.
Does any TV vendor really do that? I don’t think so. TCL and Hisense could. I am not sure Samsung and LG can. They just have different agendas. I would also venture a guess and say that it will probably cost a lot less to acquire devoted Gen X TV brand loyalists than sponsoring sports programming.
You can probably get more bang for your buck from aligning your TV brand with a Tik Tok influencer or Twitch gamer than the NFL or NBA.
Juxtaposing TV Consumption Patters
First, let’s start with a survey conducted by Omdia, courtesy of The Elec, involving over 40,000 consumers across eight regions, including the United States, Western Europe, Brazil, Mexico, India, and Japan. The survey aimed to understand the key factors consumers consider when purchasing a new TV in the next 12 months.
The primary finding was that the quality of smart TV functions is the top priority for most consumers. Smart TV functionality refers to the ability of a TV to connect to the internet, install apps, and perform beyond traditional TV functions.
In order of importance, the considerations ranked were:
- Smart TV functions
- Large screen size
- 4K (UHD) resolution
- Energy efficiency
- Brand (with brands like Samsung Electronics and LG Electronics mentioned)
- OLED technology
- Design
- HDR
- Gaming performance
The survey revealed regional differences. For instance, over 60% of respondents in Brazil and Mexico prioritized smart TV features the most, similar to about half of American consumers. However, in Japan, large screen size and energy efficiency were more important than smart TV functions.
The survey also highlighted a shift in American companies’ business models. Instead of relying on traditional paid services like cable TV, they are now focusing on content streaming. Brands like Roku and Vizio in North America and parts of South America, and Telly in the United States, are selling TVs at a price slightly higher than the manufacturing cost. They then generate revenue through advertisements and viewing data. This model requires consumers to spend more time watching TV, making a well-designed and responsive operating system crucial for a good consumer experience.
Omdia noted that if consumers find the smart TV’s operating system difficult to use or slow, they might opt for an SMD instead. This shift could affect the expected advertising revenue for the TV manufacturers, transferring it to the streaming service providers. The survey noted that in 2022, US smart TV advertising sales reached $24 billion, a figure expected to rise. Currently, the impact of smart TV advertising is mainly in the US and parts of Central and South America, but Omdia predicts this influence will expand to other regions in the next three years.
Now, let’s juxtapose this information next to the New Streamer 2024 research by Amdocs, a survey of US consumers designed to understand their sentiments towards streaming services and changing expectations. This survey found:
- Consumers now prioritize content quality over price, with 48% valuing quality most for service loyalty—a shift from 2020 preferences.
- Despite rising costs, consumers are less concerned about price, with many spending over $50 monthly on digital subscriptions.
- Original content is highly valued, but there’s also significant interest in access to older titles.
- There’s a trend towards active streaming experiences, like cloud gaming, with many consumers open to trying new services in this area.
Taking both sets of information at face value, it may be hard to reconcile consumer sentiment, but it may be that the Amdocs survey is more attuned to the expectations of Gen X. So, gaming and streamers weigh heavily on their expectations of TV entertainment, more than is apparent in the Omdia survey. So, are we getting the right kind of data to figure out how to build brand loyalty with future generations of TV buyers?
