Why Consumers Aren’t Buying New TVs

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You probably bought a cool new flat-screen TV within the last couple of years. But aren’t you ready for a new-new one now?

Wisely or not, today’s consumers seem to accept the fact that cell phones and other small electronic gadgets should be swapped for newer models every couple of years, if not sooner. But TV manufacturers are having a hard time convincing couch potatoes that the sleek flat screens scooped up in large quantities by consumers over the last few years are already in need of replacement.

The folks selling TVs aren’t happy about this, the NY Times reports. After periods in which TV sales increased regularly by 20%, sales of LCD and plasma TVs inched up by just 2.9% from 2009 to 2010. The main reason for the slowdown seems to be directly correlated to the steep rise in sales from previous years. In other words, consumers aren’t all that eager to replace the flat-screen TVs that are already installed on their living room walls and have barely been there long enough to begin collecting dust.

Even as newer TVs come out with much-hyped features—3-D, Internet connectivity—consumers just aren’t biting like they used to. We just won’t accept that TVs are a “new every two” product along the lines of cell phones and perhaps computers and MP3 players.

This probably has as much to do with the higher expense of a state-of-the-art TV as it does with the fact that the new features elicit something of a yawn. Consumers immediately grasped the difference between an old boxy projection tube TV and a flat screen: The new model was, um, flat. It occupied less space, and the picture was crisper and plain better, though honestly, I still have an old Sony in my basement and the picture is pretty darn nice.

But 3-D TV? That’s something few consumers were asking for, even as it was christened as the “next great” thing. And if consumers aren’t clamoring for an advance in technology, they’re not going to pay extra to get it, especially not when you have to wear those dorky expensive glasses in your living room.

In the Times story, a quote from Paul Gagnon, director of North American TV research at DisplaySearch, compares TV manufacturers’ efforts to increase sales—and increase TV prices—to the car industry:

“It’s kind of like having the auto industry trying to raise the prices of cars by 20 percent by adding all these options to every vehicle”

You can’t blame TV manufacturers and marketers for trying, of course. But the sales pitch is even less effective when consumers already have a new flat-screen TV freshly mounted in the living room—the equivalent of car in the garage that still has that new car smell.

There’s also the fact that it was the middle-class (not the rich) who were buying the bulk of those flat screens during the TV sales heyday a few years back, and today’s uncertain, insecure middle-class Americans aren’t game to upgrade to pricey new TVs that represent only marginal improvement. In a USA Today interview, Sony’s CEO had this to say about the failure of 3-D TVs to catch on with the mainstream:

Talk about the declining middle class in America: Those are your early adopters. It’s not the rich. It’s the middle class and young people.

Early adopters, we’ve learned, may be trendsetters or suckers, and thus far 3-D TV owners don’t seem to be at the forefront of any major trends.