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Audio Category Overview (US)

Delivered June 26, 2020. Contributor: Katherine D.

Goals

Support a pitch for JBL, which is an audio company that makes headphones, speakers, etc for people of all ages, via helping to identify white space/a unique and ownable insight in the very saturated audio category. This will be done via a category overview, which should include trends, the competitive landscape, and how COVID-19 has impacted the audio/music industry (with a special focus on streaming services).

Early Findings

Category Insight

  • The top four companies which may compete with JBL when it comes to music/sound, by net revenue, are Shure Inc., Yamaha Corporation of America, Jam Industries, and QSC Audio Products. Note that this list comes with several caveats. Firstly, Harman Professional actually leads the market for this category, but JBL is one of its subsidiaries. Second, Fender Musical Instruments and Steinway Musical Instruments would normally be on the list but only focus on creating instruments. Lastly, InMusic Brands (Akai, Alesis, Alto, Ion, M-Audio, and Numark) also are on the list but are a conglomeration of several brands so do not accurately represent a single competitor.
  • The biggest impact of COVID-19 on the music/audio industry has been on live events. A 6-month shutdown will cost the industry an estimated $10b in sponsorship. It has also affected streaming and recorded music sales, as physical sales drop and discretionary spending falls as well. The former fell by about one-third, which is massive as it is about a quarter of recorded music revenue. Digital sales fell by around 11%.
  • How people are consuming is also changing. Spotify said listening habits were now more in line with weekend listening habits before COVID-19, and relaxing genres have risen in popularity.

JBL Insight

  • JBL is the market leader for portable speakers and has been for the past five years. They have a 34.2% market share and announced they had shipped 100m units worldwide as of September 2019. They ascribe their success to the focus on innovation built around seeming technical opposites (ex. how to get big sound from a small speaker, or how to have the speaker adjust itself to environmental sound). Their answer to the former brought it great success with the JBL Flip, which shipped over 1m units in its first year.
  • This focus on innovation around constraints has led to a focus on models that are adapted to very specific use cases. While they only entered the portable speaker category in 2012, they've since released 26 models that are focused on such narrow moments as hiking, picnicking, or going to the beach.
  • Their portfolio categories include headphones, speakers, gaming-specific products (usually gaming headphones), and professional equipment.

PROPRIETARY RESEARCH AVAILABLE

We found some proprietary research from one of our data partners which may be helpful:
Portable Players in the US (Euromonitor International, $990)
If you'd like us to purchase this report on your behalf, just let us know!

Proposed next steps:

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