Leisure in the Home

Published by: Key Note Publications Ltd

Published: Nov. 1, 2008 - 188 Pages

Table of Contents

Executive Summary

1. Industry Overview

REPORT COVERAGE

REPORT BACKGROUND

ECONOMIC TRENDS

Population

Table 1.1: UK Resident Population Estimates by Sex (000), Mid-Years 2003-2007

Gross Domestic Product

Table 1.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m), 2003-2007

Inflation

Table 1.3: UK Rate of Inflation (%), 2003-2007

Unemployment

Table 1.4: Actual Number of Unemployed Persons in the UK (million), 2003-2007

Household Disposable Income

Table 1.5: UK Household Disposable Income Per Capita (£), 2003-2007

MARKET SIZE

Table 1.6: Consumer Spending on In-Home Leisure at Current Prices (£m), 2004-2008

Figure 1.1: Consumer Spending on In-Home Leisure at Current Prices (£m), 2008

Market Segmentation

Industry Structure

Hardware Convergence

Global Entertainment Groups

Broadcasting Structure

Advertising and Sponsorship Revenues

Table 1.7: Advertising Revenues by Media Sector (£m and %), 2007

New Media

MARKET POSITION

KEY TRENDS

LEGISLATION

KEY TRADE ASSOCIATIONS

2. PEST Analysis

POLITICAL FACTORS

ECONOMIC FACTORS

SOCIAL FACTORS

TECHNOLOGICAL FACTORS

3. Key Note Primary Research

Popular Leisure Activities

Table 3.1: Penetration of Popular Leisure Activities in the Home by Sex (% of adults), 2006 and 2008

Leisure Outside the Home

Table 3.2: Summary of Most Popular Leisure Activities Outside the Home (% of adults), 2006 and 2008

4. Competitive Structure

THE MARKETPLACE

National Amusements (Viacom, CBS, both US)

NBC Universal (jointly owned by Vivendi, France and General Electric, US)

News Corporation (Australia/US)

Sony (Japan)

Time Warner (US)

The Walt Disney Company (US)

Table 4.1: Key Companies in In-Home Leisure, 2008

market leaders

Apple Inc

BBC (British Broadcasting Corporation)

Bertelsmann AG

Microsoft

National Amusements

News Corporation

Sony Corporation

Time Warner

Vivendi (including NBC Universal and Universal Music Group)

The Walt Disney Company

Outside Suppliers

MARKETING ACTIVITY

5. Home Viewing

INTRODUCTION

KEY TRENDS

Still the Most Popular Leisure Activity

Growth of Multichannel Services

BBC Role Preserved Until 2016

Concentration Among Commercial Suppliers

Advances in Viewing Equipment

Broadcasters Diversifying into the Internet

MARKET SIZE

Table 5.1: Consumer Spending on Home Viewing Equipment and Services (£m), 2004-2008

Figure 5.1: Consumer Spending on Home Viewing Equipment and Services (£m), 2004-2008

Viewing Figures

Advertising Revenues

By Market Sector

Table 5.2: Consumer Spending on Home Viewing Sector by Type (£m and %), 2008

SUPPLY STRUCTURE

Television Broadcasting

Other Market Sectors

MAJOR PLAYERS

Table 5.3: Major Companies in Home Viewing Classified by Activity, 2008

Channel 4

Freeview and Top-Up TV

ITV PLC

SMG PLC

The UTV Group

Virgin Media Inc

MAIN MEDIA ADVERTISING

Table 5.4: Main Media Advertising Expenditure on Home Viewing (£000), Years Ending June 2006 and 2008

BUYING BEHAVIOUR

Table 5.5: Home Viewing by Sex, Age, Social Grade and Region (% of adults), 2006 and 2008

Table 5.6: Ownership of TV Equipment and Services (% of adults), May 2008

FORECASTS

Table 5.7: Forecast Consumer Spending on Home Viewing Equipment and Services (£m), 2009-2013

6. Home Listening

INTRODUCTION

KEY TRENDS

Lifestyle Changes Affecting Listening

Impact of Digital Technology

BBC Still Dominant in Radio

The iPod Revolution

MARKET SIZE

Table 6.1: Consumer Spending on Home Listening Equipment (£m), 2004-2008

Figure 6.1: Consumer Spending on Home Listening Equipment (£m), 2004-2008

BY MARKET SECTOR

SUPPLY STRUCTURE

Radio Broadcasting

Audio Hardware

MAJOR PLAYERS

Table 6.2: Major Companies in Home Listening Classified by Activity, 2008

Bauer Radio (formerly Emap Radio)

Global Radio Holdings Ltd

Guardian Media Group

Other Radio Broadcasters

Audio Hardware

MAIN MEDIA ADVERTISING

Table 6.3: Main Media Advertising Expenditure on Home Listening (£000), Years Ending June 2006 and 2008

BUYING BEHAVIOUR

Table 6.4: Home Listening by Sex, Age, Social Grade and Region (% of adults), 2006 and 2008

FORECASTS

Table 6.5: Forecast Consumer Spending on Home Listening Equipment (£m), 2009-2013

7. Recorded Media

INTRODUCTION

KEY TRENDS

HD and Blu-ray Stimulate DVD Sales

Video-on-Demand Emerging as a Market

Recorded Music Struggling on Several Fronts

Industry Agreement on Music Heralds Optimism

No Change Among Global Majors

MARKET SIZE

Table 7.1: Consumer Spending on Recorded Media (£m), 2004-2008

Figure 7.1: Consumer Spending on Recorded Media (£m), 2004-2008

BY MARKET SECTOR

Video Recordings

Table 7.2: Breakdown of Filmed Entertainment by `Window' (£m), 2003-2007

Audio Recordings

SUPPLY STRUCTURE

Film Industry

Music Industry

Distribution of Recordings

MAJOR PLAYERS

Table 7.3: Major Companies in Recorded Media Classified by Activity, 2008

EMI Group

Warner Music Group

Other Film Companies

Other Music Companies

MAIN MEDIA ADVERTISING

BUYING BEHAVIOUR

Table 7.4: Recorded Media Viewing/Listening by Sex, Age, Social Grade and Region (% of adults), 2006 and 2008

FORECASTS

Table 7.5: Forecast Consumer Spending on Recorded Media (£m), 2009-2013

8. Reading

INTRODUCTION

KEY TRENDS

Books Surviving and Thriving

Newspapers Surviving But Struggling

Celebrity Obsession Drives Magazine Market

MARKET SIZE

Table 8.1: Consumer Spending on Reading Materials (£m), 2004-2008

Figure 8.1: Consumer Spending on Reading Materials (£m), 2004-2008

BY MARKET SECTOR

Books

Newspapers

Magazines

SUPPLY STRUCTURE

MAJOR PLAYERS

Table 8.2: Major Publishers in Consumer Books, Newspapers and Magazines, 2008

Book Publishers

Hachette

Macmillan

Pearson

Other Companies

Newspaper Publishers

Daily Mail & General Trust PLC

Guardian Media Group

Independent News & Media PLC

Johnston Press

Newsquest

Northern & Shell

Telegraph Media Group

Trinity Mirror

Magazine Publishers

H Bauer Publishing Ltd

Hachette Filipacchi Medias

DC Thomson & Co

Condé Nast Publications

National Magazine Company

Dennis Publishing

Other Companies

MAIN MEDIA ADVERTISING

Table 8.3: Main Media Advertising Expenditure on Reading (£000), Years Ending June 2006 and 2008

BUYING BEHAVIOUR

Table 8.4: Reading at Home by Sex, Age, Social Grade and Region, 2006 and 2008

FORECASTS

Table 8.5: Forecast Consumer Spending on Reading Materials (£m), 2009-2013

9. Home Computing and the Internet

INTRODUCTION

KEY TRENDS

Basic Hardware Reaching Saturation

Social Networking Outstanding Among Youth

E-Commerce Applied to Leisure Buying

Hardware Convergence Brings in New Competitors

MARKET SIZE

Table 9.1: Consumer Spending on Home Computers and Online Leisure (£m), 2004-2008

Figure 9.1: Consumer Spending on Home Computers and Online Leisure (£m), 2004-2008

Table 9.2: Ownership/and Buying of Home Computers (% of adults), 2004-2008

USE OF HOME COMPUTERS

Table: 9.3 Selected Uses of the Home Computer (% of adults), 2004-2008

SUPPLY STRUCTURE

MAJOR PLAYERS

Amazon Inc

Dell Inc

eBay Inc

Google Inc

Other Leisure Websites

MAIN MEDIA ADVERTISING

Table 9.4: Main Media Advertising Expenditure by Computer and Internet Companies (£000), Years Ending June 2006 and 2008

BUYING BEHAVIOUR

Table 9.5: `Surfing' the Internet as Home Leisure by Sex, Age, Social Grade and Region (% of adults), 2006 and 2008

Table 9.6: Selected Online Leisure Activities and Websites Used (% of adults), November 2007

Table 9.7 Selected Website Penetration Levels by Age Group (% of adults), November 2007

FORECASTS

Table 9.8: Forecast Consumer Spending on Home Computers and Online Leisure (£m), 2009-2013

10. Toys and Games

INTRODUCTION

KEY TRENDS

Fewer Children but Increased Expenditure

Table 10.1: The UK Child Population by Age Group (000), 2002-2006

Impact of the Wii

Other Major Console Launches

Increasing Convergence Around Electronics

MARKET SIZE

Table 10.2: Consumer Spending on Toys and Games (£m), 2004-2008

Figure 10.1: Consumer Spending on Toys and Games (£m), 2004-2008

BY MARKET SECTOR

Traditional Toys and Games

Table 10.3: Consumer Spending on Traditional Toys and Games by Sector (£m and %), 2007

Console Games

SUPPLY STRUCTURE

Traditional Toys and Games

MAJOR PLAYERS

Nintendo

Hasbro Inc

Mattel Inc

Other Toy Companies

Games Software

MAIN MEDIA ADVERTISING

BUYING BEHAVIOUR

Table 10.4: Playing Games as Home Leisure by Sex, Age, Social Grade and Region (% of adults), 2006 and 2008

FORECASTS

Table 10.5: Forecast Consumer Spending on Toys and Games (£m), 2009-2013

11. Home Improvement and Traditional Hobbies

INTRODUCTION

KEY TRENDS

Home Improvement in the Doldrums

Entertaining in the Home — a Central Leisure Activity

Outdoor Leisure in the Garden

Entry of the Grocery Chains

Traditional Hobbies Shifting to Computers and Internet

MARKET SIZE

Table 11.1: Consumer Expenditure on Home Improvement and Traditional Hobby Goods (£m), 2004-2008

Figure 11.1: Consumer Expenditure on Home Improvement and Traditional Hobby Goods (£m), 2004-2008

BY MARKET SECTOR

DIY

Gardening

Traditional Hobbies

SUPPLY STRUCTURE

MAJOR PLAYERS

Home Improvement

B&Q

Dobbies

Ikea

Homebase

Wickes and Focus (Travis Perkins)

Wyevale Garden Centres

Other Home-Improvement Companies

Table 11.2: Leading Companies and Brands in Home Improvement, 2008

Traditional Hobbies

Photography

Musical Instruments

Other Hobby Companies.

MAIN MEDIA ADVERTISING

Table 11.3: Main Media Advertising Expenditure by DIY Retailers and Garden Centres (£000), Year Ending June 2008

Table 11.4: Main Media Advertising Expenditure on Partworks (£000), Years Ending June 2006 and 2008

BUYING BEHAVIOUR

Home Improvement

Table 11.5: Gardening and DIY by Sex, Age, Social Grade and Region (% of adults), 2006 and 2008

Hobbies

Table 11.6: Hobbies and Other Popular Leisure Activities in the Home (% adults), 2006-2008

Table 11.7: Popular Hobbies by Sex, Age, Social Grade and Region (% of adults), 2008

FORECASTS

Table 11.8: Forecast Expenditure on Home Improvement and Traditional Hobby Goods (£m), 2009-2013

12. A Global Perspective

Overview

Media and Publishing

Music

Computing and Games

13. The Future

ECONOMIC FORECASTS

Population

Table 13.1: Forecast UK Resident Population by Sex (000), Mid-Years 2008-2012

Table 13.2: The Forecast UK Population by Age (000), 2007 and 2012

Gross Domestic Product

Table 13.3: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2008-2012

Inflation

Table 13.4: Forecast UK Rate of Inflation (%), 2008-2012

Unemployment

Table 13.5: Forecast Actual Number of Unemployed Persons in the UK (million), 2008-2012

Forecasts 2009 to 2013

Table 13.6: Forecast at Current Prices Consumer Spending on In-Home Leisure (£m), 2009-2013

Market Growth

Figure 13.1: Consumer Spending on In-Home Leisure at Current Prices (£m), 2004-2013

Future Trends

Passive Leisure — Entertainment and the Media

Role of the Home Computer and the Internet

More Active Leisure in the Home?

14. Further Sources

Associations

General Sources

Government Publications

Other Sources

Bisnode Sources

Abstract

In 2008, UK consumers are predicted to have spent £40.7bn on leisure in the home, compared to around £63.8bn on leisure activities outside the home. Some of the many in-home activities are:

• Home viewing — £9.2bn was spent on home viewing in 2008. This includes: spending on the purchase of television equipment; paying the Licence Fee (a `tax' on owners of television sets); and, in most households, subscriptions to multichannel television services.
• Reading materials — consumers spent £8.1bn on books, newspapers and magazines. Books have had a good decade, inspired by children's reading (especially the Harry Potter phenomenon), massive bestsellers such as The Da Vinci Code and reading groups, promoted on television.
• DIY — £6.75bn was spent on DIY materials, one of the few physically active leisure pursuits in the home (along with gardening, £3.45bn).

The most significant growth market in the consumer survey, however, was `surfing the Internet', occupying 68.9% of adults in 2008, up from 58% in a similar survey conducted in 2006. When using the Internet, consumers are more actively engaged than they used to be, thanks to social networking and websites that encourage hobbies such as collecting (eBay), contacting long-lost friends and relatives (Friends Reunited or Ancestry.com) or downloading music. Alongside these hobbies, and the rise in reading books, Key Note suggests there is evidence of a movement away from purely passive leisure. Symbolic of this has been the phenomenally popular gaming console Wii, from Nintendo, which may be the most important development in home leisure in this decade. Most Wii games either require physical activity or offer intellectual stimulation.

Nintendo is just one of a host of giant companies competing for the attention of the consumer at home. Some, like Nintendo in console games, are specialists in a particular market. The variety of specialists includes: B&Q, the leading home-improvement chain; Dell, market leader in home computers; and Global Radio, the top commercial broadcaster.

Other parts of the market, however, are dominated by diversified groups with global operations. One such example is Rupert Murdoch's News Corporation, based in Australia and the US, but with powerful media influences in the UK through newspapers, Sky TV and HarperCollins books. Through its 20th Century Fox subsidiary, News Corporation is also one of the six global groups owning the Hollywood studios that continue to dominate the market for movies. Even more diverse among the global groups is Sony, which has interests in movies, music and gaming consoles (PlayStation). Sony also has leading brands of home hardware (televisions and Walkman music players).

In contrast to these multinationals is the BBC, which continues to act as a driving force in UK broadcasting. Secure in its current role until at least 2017, the BBC has been investing in multichannel television (as joint owner of the Freeview service), publishing of books and magazines and the Internet, where its iPlayer is leading the trend towards watching `television' on computers or even mobile phones. Key Note believes that a main question for the future of in-home leisure is the extent to which consumers will accept the demise of separate appliances (television and computer) for basic home viewing.

This Key Note Market Review on the UK market for leisure in the home was compiled at a time of deepening economic gloom. In periods such as this, consumers will obviously think twice about spending on the more expensive leisure goods and services, while the credit crunch persists. Leisure markets are vulnerable because they involve non-essential purchases and it is also easy for consumers to save money on in-home leisure (e.g. by borrowing books instead of buying them, or by giving up television subscriptions and watching free multichannel television). Given these downbeat factors, Key Note is forecasting just 4.4% growth for in-home leisure spending between 2009 and 2013, although within the overall market there will be winners such as toys and games, home improvement and reading materials, and losers such as recorded media and home listening.

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