THE HEADPHONE MARKET Hefio Survey
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1 THE HEADPHONE MARKET Hefio Survey Hefio Internal Report # Report by Catarina Hiipakka Espoo All rights reserved.
2 Description This document reports on a study conducted by Hefio Oy with the general purpose of describing the headphone market. The study was performed though an online survey. Data were collected between June 27 th and July 6 th A total of 94 people responded to the survey. 86% of the respondents had residence in Finland, 11% resided in other EU countries, and 3% resided in a country outside the EU. 20% of the respondents were female, 78% were male, and 2% did not disclose the gender. The ages of the respondents varied between 21 and 66, with mean There were 33.3% with age 30 and below; 57.8% with age between 30 and 40; and 9.9% were older than 40 years old. Results 1. Main use for the headphones The main goal of this section was to understand what headphones are mostly used for, in the current market. 93% of the respondents reported that they mainly use headphones for listening to music. The second largest use, identified by 44% of the respondents, was watching movies and videos. 32% of the respondents referred phone calls as a main use, and 32% referred teleconferencing. Headphones are mostly used for Other Audiobooks Podcasts Gaming Noise Attenuation Phone Calls Watching Movies or Videos Teleconferencing Music Listening 0%# 10%# 20%# 30%# 40%# 50%# 60%# 70%# 80%# 90%#100%# Figure 1 Main uses of the headphones, in percentage of respondents reporting them. Noise attenuation (27%) and gaming (21%) were also identified as common uses. Other, less frequent, uses include Podcasts (4%), audiobooks (2%), and research. 2. Platform The main goal of this section was to identify the platforms to which the headphones are mostly connected to, in the current market. According to our
3 findings, headphones are mostly connected to the computer (77%) and smartphone (67%). Headphones are usually connected to Other Tablet Television Portable Music Player Music System/Aplifier Smartphone Computer 0%# 10%# 20%# 30%# 40%# 50%# 60%# 70%# 80%# 90%# Figure 2 Most common interfaces to which the headphones are connected, in percentage of respondents reporting them. Less respondents referred tablets (19%) and portable music players (18%). A small proportion of the population uses headphones connected to a music system or amplifier (5%), television (1%), or other interfaces like electric musical instruments. 3. Value of the product The main goal of this section was to identify how much the consumers pay for headphones for personal and professional use. Additionally, it aimed at identifying the key headphone features expected for headphones costing above 100. Most expensive headphones for personal use cost less#than# 1000# less#than# 500# less#than# 300# less#than# 100# less#than# 50# less#than# 20# 0%# 5%# 10%# 15%# 20%# 25%# 30%# 35%# Figure 3 The cost of the most expensive headphones bought for personal use, in percentage of respondents. Regarding headphones for personal use, most respondents (60%) have spent between 50 and 300. Only 9% of the respondents spent less than 20 in
4 their personal headphones. 23% spent between 20 and 50, 30% spent between 50 and 100 and 30% spent between 100 and % of respondents spent between 300 and 500, and 1% spent more than 500. Regarding what consumers paid for headphones to use professionally, values were relatively different. 78% of the respondents reported buying headphones for professional use. Of these, 4% spent less than 20 on the headphones; 26% spent between 20 and 50; 27% spent between 50 and 100, 22% spent between 100 and 300, 12% spent between 300 and 500, 7% spent between 500 and 1000, and 1% spent over Most expensive headphones for professional use cost more"than" 1000" less"than" 1000" less"than" 500" less"than" 300" less"than" 100" less"than" 50" less"than" 20" 0" 5" 10" 15" 20" 25" 30" Figure 4 The cost of the most expensive headphones bought for professional use, in percentage of respondents. When inquired about the required features to be wiling to pay more than 100 for a set of headphones, the most identified feature was noise cancellation (66%), followed by a new technology to make sound better (62%). Other highly required features were better durability (50%), wireless connection (45%), better portability (40%) and great design (30%). 22% of the respondents identified platform-independence as a key feature. Would be willing to pay more than 100 for a headphone that Runs#on#all#plaIorms# Has#presGgious#brand# Can#be#used#as#a#hearing#aid# Is#wireless# Has#soBware#for#customized#sound# Has#be=er#portability# Has#great#design# Has#be=er#durability# Has#noise#cancelling#features# Has#new#technology#for#be=er#sound# Never# 0%# 10%# 20%# 30%# 40%# 50%# 60%# 70%# Figure 5 Features required in a headphone to be willing to pay more than 100, in percentage of respondents reporting them.
5 Among the less identified features were having additional software to be able to customize sound (13%), having a prestigious brand (3%) and being able to be used as a hearing aid (2%). Other features were having better frequency response, minimizing magnetic artifacts for MEG, greater comfort, staying put during jogging, fitting inside a helmet, better fit and better materials for daily use. 12% of the respondents reported that they would never pay more than 100 for a set of headphones. 4. Market size and tendency This section was specifically targeted at understanding how often consumers buy headphones, and identifying a trend. It was assumed, conservatively, that subjects reporting buying more than 5 headphones bought precisely 6. In the past 5 years, respondents bought and average of 2.41 headphones per person, of which an average of 1.39 were bought in the past 2 years. Number of headphones bought in past 5 years more#than#5# 5# 4# 3# 2# 1# 0# 0%# 5%# 10%# 15%# 20%# 25%# 30%# Figure 6 Number of headphones bought in the past 5 years, in percentage of respondents. Figure 7 Number of headphones bought in the past 2 years, in percentage of respondents. This means that each respondent bought an average of 0.34 headphones per person per year in the first 3 years of the past 5 years. There was a clear acceleration in headphone purchase, to an average of 0.7 headphones per
6 person per year in the last 2 years of the past 5 years. Therefore, purchases nearly doubled in the last 2 years, with a growth factor of National branding This section was targeted at identifying the expectations of the market toward a Finnish headphone. It was found that the consumers have high expectations in all four enquired areas: sound quality, material quality, design quality, and price. Sound Quality Material Quality 2%$ 16%$ 5%$ 38%$ 57%$ 82%$ Design Quality Price 1%$ 4%$ 18%$ 42%$ 54%$ 81%$ Above$average$ Average$ Below$average$ Figure 8 Expected Sound Quality, Material Quality, Design Quality and Price for headphones known to be Finnish. Regarding sound quality, 82% of the respondents expect it to be above average, while 16% expect it to be below average, and 2% expect it to be average. Material quality is also expected to be high, 57% of the respondents expect it to be above average, while 38% expect it to be at average level, and only 5% expect a worse quality than average. With a very similar pattern, design quality is expected to be above average by 54% of the respondents, at average level by 42%, and below average by only 4%. The high expectations regarding quality are met by expected elevated prices: 81% of the respondents expect the headphone price to be above average, 18% expect it to be average, and only 1% expects it to be below average.
7 Conclusion By far, the main use for headphones is listening to music, but there are other frequent uses, like watching video, phone calls and teleconferencing. Headphones are mostly connected to computers and smartphones, and the other interfaces are rarely used. Most people spend between 50 and 300 in headphones for personal use. Interestingly, there are as many people paying as there are paying Headphones for professional use usually have similar costs, but there is a relevant niche of people paying above 300 and 500. To pay more than 100 for a set of headphones, consumers require mainly noise cancelling features, new sound technology to make the sound better, better durability, wireless connection and good portability. The headphone market is extremely large, most people buying headphones every one to two years, and it has doubled in the past 2 years. Finally, consumers expect above average sound, material and design quality from Finnish headphones. In a similar way, the price is expected to higher than average.
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