2017 Is Expected to Be Better for Appliance Stores Sales After stagnant growth from 2013 to 2015, sales at electronics and appliance stores (adjusted) decreased 5.1% during 2016, to a total of $97.403 billion. During the first half of 2017, sales decreased 1.0% to $48.639 billion. While dedicated appliance store sales (unadjusted) decreased 7.0 from 2015 to 2016, and another 8.4% from January–June 2016 to January–June 2017, overall US appliance sales increased 5.6% to $69 billion during 2016, according to Euromonitor. According to a January 2017 story in TWICE, industry leaders expect appliance sales to increase during 2017 due to a strong economy, a replacement cycle from appliances purchased between 2004 and 2006 and product innovations in laundry and refrigerators.

Shipments Suggest Stronger Future Sales Factory unit shipments of major appliances for June 2017, compared to June 2016, as well as year to date 2017, compared to 2016, increased in every category, except portable dishwashers (-9.2%) and freezers (-17.0%).  The appliance shipments that increased the most year to date were room air conditioners (18.8%), microwave ovens (12.0%) and surface cooking units (+11.7%). For the June YOY comparison, gas range shipments decreased by 0.7%.

Top Retailers Among retailers who sell appliances, home improvement centers, such as The Home Depot and Lowe’s, dominate the market with a 45% share of appliances sold. The Home Depot seems the biggest winner from hhgregg’s closure, with double-digit increases. In TWICE’s Top 50 Major Appliance Retailers for 2016, Lowe’s remained #1, The Home Depot, #2 and Sears #3. Others in the top 10 were Best Buy, #4; Sears Hometown, #5; and Walmart, #6. Last year’s #7, hhgregg, closed all of its stores this year. Best Buy is closing the gap between it and Sears, from $1.3 billion to $743 million in appliance revenues. JC Penney reintroduced appliances to more of its stores, climbing to #23 in TWICE’s ranking. Sears had a 9.5% decrease in appliance sales during 2016.

Appliances Are More Fashionable and High-Tech In contrast to earlier years, appliances are available in more than just white, with new colors and finishes, including black stainless steel and colored enamel and with colored lights. Commercial- grade and high-end appliances have also boosted the market. Nearly 7% of American households have smart home devices. IHS Markit Technology, a market research firm, predicts that smart appliances will account for 77.6% of the global smart home market, or $11.4 billion. New, high-tech features on appliances are prompting some consumers to purchase new appliances even when their old ones are still functionally properly and efficiently.

The Top Three’s Winning Game Plans The top-three appliance retailers, Lowe’s, The Home Depot and Sears, account for more than 90% of all US major appliance sales. Together, the top-three has almost 4,400 stores, giving them a huge retail footprint, although Sears is closing stores. The Home Depot caters mostly to homebuilders and contractors, so its in-store display is basic, but it dominates online appliance sales. Lowe’s has a large space dedicated to appliances and uses attractive groupings to appeal to customers. Best Buy has brand-centric merchandising areas and has a Pacific Kitchen & Home section. Like smaller, but successful, appliance dealers, Best Buy highlights premium appliances, shows them in vignettes and has interactive events and areas.

Americans Not Afraid to Buy Appliances Online Although the majority of consumers, 56%, prefer to buy home appliance in-store compared to online (33%), online appliance sales have been increasing. Refrigerators were the appliance most often bought online followed by washing machines. During 2016, every major appliance category experienced a year-over-year increase in online sales. Ovens were the fastest-growing category of online purchases at 69% and sink disposers increased the least at only 17%, according to The NPD Group. Online sales increased on Black Friday/Cyber Monday, Memorial Day, Independence Day and Labor Day compared to the rest of the year. Black Friday/Cyber Monday accounted for 9% of the online appliance sales for the year.

Advertising Strategies When advertising to first-time homebuyers, especially Millennials, consider showing smaller appliances that fit starter homes. Focus on cool, new features of smart home products to encourage customers to replace older, but still operational appliances. Show the appliances being used in kitchens, so customers can picture themselves owning them.

New Media Strategies Create partnerships with local contractors and kitchen designers to sell bundles of appliances and conduct joint email campaigns. When a new product is introduced, write blog posts describing its features and comparing it to other products. In the blog, include a discount code that customers can use when they visit the showroom. Invite consumers into your showroom via social media videos for design events, showcasing the newest appliances.