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The home theater market is estimated to grow at a CAGR of 8.51% and the size of the market is forecasted to increase by USD 7.4 billion between 2022 and 2027. The growth of the market depends on several factors, including the rise in disposable income, the growth of smart homes, and the increasing adoption of product bundling.
This report extensively covers market segmentation by product (home theater speakers and sound bars), distribution channel (offline and online), and geography (APAC, North America, Europe, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The rise in disposable income is notably driving the home cinema market growth, although factors such as the high cost of home theater systems may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Home Theater Market Driver
The rise in disposable income is notably driving the home theater systems market growth. Household income has been increasing in developed countries. For instance, the household spending of the EU was USD 8,977,732 in 2016 and reached USD 9,445,943 in 2020. Similarly, in the US, the total household spending rose from USD 12,769,962 in 2016 to USD 14,544,601 in 2019.
The rise in income levels has increased the spending capability of the population. As a result, high-end audio devices have become more affordable. When home theaters were first introduced in the market, they were widely adopted in developed countries. However, in developing nations, only niche segments were targeted. In recent years, vendors have been focusing on capturing emerging markets such as China and India due to rapid economic growth and increasing purchasing power. Thus, the rise in consumer disposable income will drive the growth of the global home cinema market during the forecast period.
Significant Home Theater Market Trend
The demand for customized home theater systems is a key trend in the home theater systems market. Currently, only a few companies offer customized home theater systems. Moreover, such services are available at higher prices when compared to home theater systems offered by established brands. Hence, home theaters are not a feasible option for the middle-income segment due to their high cost.
Companies such as RAVYA provide customized home theaters. The company offers home theater packages in three different categories, namely room size, room performance, and room design. Thus, increasing demand for customized home theater systems is one of the key trends in the market, which is expected to fuel the growth of the global home cinema market during the forecast period.
Major Home Theater Market Challenge
The high cost of home theater systems may impede the home theater systems market growth. Stand-alone speaker systems are less expensive than home theater systems. To set up a home theater, a residential consumer has to spend USD 50 to USD 250 per square foot. Other variables, such as the location, level of construction needed, and quality of materials, also need to be considered. Thus, the estimated budget for home theater equipment is about USD 7,500. The equipment includes speakers, projectors, and receivers, which are selected by consumers based on their requirements.
Some of the major vendors that offer home theater systems are Sony and LG Electronics. Sony's MHC-V83D Bluetooth Tower Speaker costs USD 835, Home Theater Subwoofer costs USD 310, and 1ch Dolby Atmos costs USD 1,173.14. Thus, the high cost of home theater systems will hinder their adoption, especially among the middle-class population. This can challenge the growth of the global home cinema market during the forecast period.
Key Home Theater Market Customer Landscape
The report includes the adoption lifecycle of the home cinema market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Home Theater Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product launches, to enhance their presence in the home theater systems market.
Atlantic Technology Inc. - The company offers home theater systems along with several other products such as soundbars and speakers.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The home theater systems market share growth by the home theater speakers segment will be significant during the forecast period. Home theater systems are suitable for surround sound and a theater-like experience owing to a large number of speakers. A home theater can come in various formats. Vendors offer various formats based on demand. For instance, SAMSUNG offers the HT-J5500W Home Theater System, which consists of 5.1 channels. The demand for such products primarily comes from high-income regions.
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Vendors are introducing new speakers with innovative designs and functionalities. For instance, in July 2021, SONY announced a plan to launch its newly developed home theater lineup with the HT-A9. Vendors are bundling products, such as home theater speakers and soundboards, to increase their sales. Such factors are expected to drive the growth of the home theater speaker segment in the global home theater systems market during the forecast period.
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APAC is estimated to contribute 47% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the home cinema market during the forecast period.
The increase in the disposable income of the population is one of the main drivers of regional market growth. The spending capability of consumers has increased over the years owing to the rise in disposable income, which is increasing the demand for media and entertainment devices such as home theater systems. China, Japan, and India are expected to be the major contributors to the market in the region during the forecast period.
This report forecasts the contribution of all the segments to the growth of the market. In addition, we have included the COVID-19 impact and the recovery strategies for each segment. The lifting of lockdown restrictions resulted in the reopening of electronics manufacturing units. Moreover, consumers in China and Singapore are expected to spend more on entertainment products such as home theater systems, sound systems, downloadable content, and gaming consoles. Thus, the rising expenditure on entertainment items such as home theater and sound systems and gaming consoles, along with the introduction of new home theater systems and soundbars, will drive the growth of the home theater systems market in APAC during the forecast period.
The reports categorize the global home theater market as a part of the global consumer electronics market, which covers products and companies engaged in the manufacturing or marketing of consumer robotics, home audio and video products, televisions, digital cameras, and related products. Growth of the global consumer electronics market will be driven by factors such as new product launches, premiumization, the rising number of dual-income households, and the rise of e-commerce. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The report forecasts market growth by revenue at global, regional, and country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by product, distribution channel, and geography.
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Home Theater Market Scope |
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Report Coverage |
Details |
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Page number |
168 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 8.51% |
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Market growth 2023-2027 |
USD 7.4 billion |
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Market structure |
Fragmented |
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YoY growth 2022-2023 (%) |
8.04 |
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Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
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Performing market contribution |
APAC at 47% |
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Key countries |
US, China, Japan, Germany, and UK |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Atlantic Technology Inc., AudioQuest, Bluesound International, Bose Corp., Bowers & Wilkins, Koninklijke Philips NV, LG Corp., Logitech International SA, Monitor Audio Ltd., NAD Electronics, Panasonic Holdings Corp., Pioneer Corp., Samsung Electronics Co. Ltd., Sennheiser Electronic GmbH and Co. KG, Sharp Corp., Sonos Inc., Sony Group Corp., the Rotel Co., Ltd., Toshiba Corp., and Yamaha Corp. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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