UPFRONT 1997: Consumer Electronics

New technologies, products are heating up big campaigns and brand-building; spending likely to top $100 million this year

Accelerated new-product schedules will drive media spending and marketing efforts in consumer electronics, photography and home appliances this fall. All three categories were stuck in the doldrums in the early ’90s, but now a flurry of new technologies are sparking new campaigns and other brand-building activities. Ad spending will likely exceed the roughly $100 million spent annually by the top five players to raise brand value, thereby diffusing the discounting mentality in the category.

Long considered a staid industry, home appliances will be heating up this year with Maytag’s introduction of horizontal-access washers. Former Frito-Lay packaged goods marketing guru Lloyd Ward, now president of Maytag, will orchestrate the launch. Whirlpool, Amana, Frigidaire and General Electric-companies currently undergoing internal restructuring-will likely attempt to liven up marketing efforts as well. (Amana may soon be sold by parent Raytheon.)

Until last year, growth in the consumer electronics category was limited to big-screen TVs. That all changed when Direct Satellite Systems-18-inch satellite dishes that beam 500-plus channels into consumers’ living rooms-captured the imagination and eyeballs of consumers. Now a slew of digital/computer convergence products, such as the upcoming RCA/Compaq TV-PC and WebTV receivers, are crowding the horizon. Digital Video Discs are launching this spring and summer in spot markets and then rolling out nationwide. Hardware makers, frustrated in their initial DVD launch schedules by a lack of titles, are now working more smoothly with Hollywood. One common DVD pitch will be the superior picture quality for viewing favorite films. (Blockbuster will start renting DVD titles.) Waiting in the wings: High-definition TVs; DVD-CD ROM players for home computers; and the possible advent of WebTV receivers, now that Microsoft has purchased WebTV.

Digital is also a buzzword in the photo category, which is reaching out to Generation X as never before with edgy advertising pitches keyed to lifestyles. Another trend is the growth of digital cameras supported for the first time this year by a growing stream of print and outdoor ads, with TV possibly in the mix soon. Eastman Kodak, Fuji, Canon, Minolta and Nikon will continue to build on last year’s debut of the digitally enhanced Advanced Photo System with new lines of single-use cameras and hipper commercials to boost Gen X appeal. Kodak will continue its “Tall Tales” brand image spots to make itself hip to younger groups. Polaroid will continue its young-skewing “See What Develops” campaign. And Minolta is launching a line of Xtreem sports cameras and lifestyle accessories.

Ad spending likely won’t exceed last year’s heavy outlays by Fuji and Kodak to launch APS and capitalize on the Olympics, but both photo category rivals should continue to spend strongly in a fast-changing, intensely competitive category. -Steve Gelsi


* Digital Video Disc players kick off with motion-picture studios

* Horizontal-access washers agitate home appliances

* Picture for digital cameras brightens

OVERALL: Spending up steeply

DARK HORSE: PC-TV, WebTV and Advanced Photo System may click with consumers as marketing efforts pick up steam

Copyright ASM Communications, Inc. (1997) ALL RIGHTS RESERVED