M&E Connections

AI-Driven Smart Speakers, 4K TVs Among Standout Black Friday Products

Artificial intelligence (AI)-driven, voice-controlled speakers and 4K Ultra High-Def (UHD) TVs were among the most popular technology products in the U.S. over the Thanksgiving and Black Friday weekend.

Although it’s too soon for an official tally of the weekend’s sales at U.S. retail stores, Google Home, Amazon Echo and other AI-powered speakers were heavily promoted in retail ad circulars — even more so than a year ago. Meanwhile, TVs were yet again the most widely promoted technology product in retail ad circulars — especially as part of their “doorbuster” specials — and 4K models seemed to make up an increasingly large percentage of all TVs promoted this time, especially in the 50- and 55-inch models.

Typically, the most heavily-promoted doorbusters end up being among the most in-demand products on Black Friday and that was expected to be the case yet again this time around.

While TVs — especially 4K ones — were widely seen as the top-selling consumer electronics products over last year’s Thanksgiving/Black Friday holiday weekend, AI-based digital assistants and speakers (namely Amazon Alexa ones) emerged as a break-out seller through the rest of last year’s holiday season. That trend is expected to only grow this holiday season now that Amazon has expanded its product line, Google Home has become more of a significant player in the product category and new entrants have emerged in the category.

One had to only look at the front pages of the Kohl’s and JCPenney Black Friday ad circulars to see how significant 4K TVs have become. Each of them had only one TV on the front page, and it was a 4K model in each case: A $499.99 Samsung 55-inch model in the case of JCPenney and a $299.99 Haier 55-inch model in the case of Kohl’s (which customers got back $90 in “Kohl’s Cash” for on top of that bargain-basement pricing).

But NPD analyst Stephen Baker questioned just how much of the 4K TV sales that were seen during the holiday weekend were related specifically to increased interest in 4K per se. “I think what we saw was a little bigger screens at a little bit cheaper pricing in the doorbuster” promotions than a year ago,” he told the Media & Entertainment Services Alliance (MESA) Nov. 27.

There were “some decent promotions in more premium products” among the 4K TVs, “but you’re not going to get a lot of doorbusters on a $1,500 television, even if it used to be $2,300,” he said, adding: “I’m sure all those doorbusters sold out because they were decent products at decent price points.”

There seemed to be more 55-inch TVs promoted for Black Friday this time, he said, calling that screen size “the biggest growth product in 2017” for TVs. There were probably less HD TVs promoted around this year’s holiday weekend at least in part because 4K has become “pretty much the standard” TV in models 50 inches and larger, he said, adding 4K TVs now account for 60-70% of total TV revenue.

It’s likely that many consumers who saw the 4K TV doorbusters advertised last week cared more about the cheap TV pricing than the fact that they were UHD models, he said, adding of the $299.99 4K TV advertised by Kohl’s: “They may know what a 4K is, but I’m not sure that that registers with them. If there was one next to it that was $199 that wasn’t 4K I’m sure that would register just as well.”

On the other hand, Baker told us: “If you’re looking for something that really kind of jumped out, clearly this year the voice-controlled speakers would be the number one kind of product” that had an even greater presence than a year ago in holiday ad circulars. “Last year, Google Home just hit the market during holiday and while [Amazon’s] Echo and Tap and Dot were out there, I don’t think they’d quite gotten to the point that they’re at now,” especially with the “aggressive” pricing that’s being seen on the Amazon devices, he said.

Voice-powered speakers are a “great category because the two brands that are promoting it” — Amazon and Google — “don’t care what the prices are; they’re not trying to make any money” off their own devices, Baker said, adding: “They just want to sell it as cheap as they can to build up their platform and installed base.”

While visiting retail stores on Black Friday, NPD analyst Ben Arnold said in a blog post that he saw “lots of activity around slightly bigger (60” and above) 4K TVs than normal and PCs – particularly Chromebooks” at a Best Buy. Target, meanwhile, “had a strong Beats promotion and I also saw several Echo products in carts” there, he said, adding: “I fully expect those two categories to lead growth this holiday season.”

Other technology products heavily promoted by U.S. retailers over the holiday weekend included the Microsoft Xbox One and Sony PlayStation 4 video game consoles, the Nintendo Switch hybrid portable and home console video game system, and virtual reality (VR) devices including PlayStation VR, Facebook’s Oculus Rift and, in the Kohl’s circular, cheap headsets from Zeiss (the VR One) and North at $49.99 and $9.99, respectively.