Britain develops into a nation of budding Spielbergs
Lights, camera, action....latest research from MINTEL finds the pull of Hollywood gripping the nation, with volume sales of video cameras growing by a massive 80% in the last five years alone. Back in 2000, just over a half a million (540,000) video cameras were sold but by 2005 annual sales had risen to almost a million (960,000).
Overall, around a quarter (24%) of adults owned a video camera by the end of last year, with 5% having bought one in the previous 12 months. But it is Mums and Dads, with a baby under the age of one who are the most likely to be making a home video, with almost half (48%) owning a video camera. What is more, as many as one in five (19%) bought one in the last 12 months - invariably for the arrival of their new child.
"Video cameras have moved from being a specialist consumer product to one that has much more mass-market appeal. The onset of the digital era, which offers improved quality, longer-lasting videos and more advanced editing features, has been a key factor in the impressive rise in popularity of video cameras. The fall in the price of these cameras at the cheaper end of the market has also made these products accessible to many more people. New parents, in particular have benefited from the range of cheaper video cameras on offer as many will undoubtedly want to record those special childhood moments of the early years, without breaking the bank," comments Matt King, senior market analyst at MINTEL.
The market for video cameras was worth almost £340 million in 2005, up from a little over £260 million in 2000. Although the overall value of the market has risen since the start of the millennium, value sales had increased by just 29% by 2005 with falling prices, especially for entry-level models, having had a major impact on market value. Indeed, the average price for a video camera has fallen significantly over the past few years from £475 in 2002 to an estimated £352 in 2005.
"Despite falling prices, growth in market value has been possible as existing owners of video cameras have increasingly looked to upgrade, especially with the arrival of DVD, hard disk and memory card technology," explains Matt King.
A digital revolution
Within the UK video camera market digital is currently the format that is seeing most growth, at the expense of other video formats such as 8mm/Hi-8 and VHS.
By 2004, digital had claimed over 90% of both volume and value sales in the market, up from around 70% and 80% respectively two years earlier. Indeed as digital has forged ahead the other main sectors of the market have experienced significant declines in both volume and value sales. Subsequently, 8mm/Hi-8 and VHS now both appear to be dying markets. Although 8mm/Hi-8 represents the larger of the two sectors they did still only account for 7% of volumes in 2004, compared with nearly a third in 2002.
Internet captures sales
The distribution of video cameras is undergoing radical change, largely due to the growth in sales through the Internet. Indeed, around 11% of purchases in 2004 were made through the Internet, with this proportion expected to rise to between a quarter and a third of volume sales in the coming years.
"The success of the Internet is partly a reflection of the cost savings that can be made by consumers when they buy on-line, a trend that is hitting traditional retailers hard. What is more, on-line savings appeal to both the camcorder ‘enthusiast’ who knows enough about the technology to be confident in purchasing on-line and the ‘average’ consumer, who may get advice in-store before making the actual purchase on-line," comments Matt King.
Calling all film makers
One factor which may affect future market growth will be the increase in video recording on other gadgets such as mobile phones or still digital cameras. Despite generally falling short of digital camcorders in terms of picture quality and editing features, these alternatives are perfectly adequate for those who simply want a convenient way to record an event on the spur of the moment.
"While the number of consumers using mobile phones or their still digital cameras to record videos is currently limited, the quality of recording is expected to improve significantly in the near future, which may result in a serious threat to the video camera market. With consumers leading increasingly hectic lifestyles, many will not have the time to watch a full-length video recording and in fact sending short clips to friends via email and mobile phone is already proving very popular. Additionally, the full functionality of video cameras is not always understood or used, and so the advantages of owning a state-of-the-art camcorder over a mobile phone that records may not actually be that significant," concludes Matt King.
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