Television digest with electronic reports (Jan-Dec 1954)

Trade Beporl October 30, 1954 TV PRODUCTION RECORD; LESSONS ABOUT COLOR: With 228,298 sets turned out week ended Oct. 22, TV output' broke an unofficial weekly record by RETMA statistics, by coincidence exceeding the old mark of 219,680 established 4 years ago to the week. With sales continuing high at all levels, the boom TV market — unaffected by recent wave of modest price increases and color promotion — has trade feeling its oats as never before. Apparently only a completely unanticipated pre-Xmas slump can keep 1954 retail sales from exceeding last year's record 6,400,000. Production for first 10 months is estimated at 5,525,000, including about 875,000 in Oct. Total compares with 6,100,000 in first 10 months of 1953. Factory sales are estimated at 5,600,000 (900,000 in Oct.). They compare with 5,800,000 in first 10 months of 1953. Distributor sales are estimated at 5,400,000 (900,000 in Oct.). Last year at this time they were 5,300,000. Retail sales in first 10 months were about 5,200,000 (850,000 in Oct.) vs. 4,925,000 same period of 1953. Inventories haven't gone up much, as result of high sales. As of Oct. 31, they're estimated about 2,000,000 in all pipelines — considered "safe". Also helping to brighten picture is fact that nearly all major manufacturers report increase in demand for second sets. Trade statisticians estimate that only 1,150,000 homes now have second sets — leaving a big market to shoot for. Over-all picture is so bright one major manufacturer told us: "Some nights I go home from the factory and wonder if we're not doing something wrong!" ^ ^ * Motorola exec, v.p. Robert W. Galvin took time out this week to recapitulate for us some of the lessons his company has learned about merchandising color. His 19-in. sets (at $895 & $995) have been introduced in key markets for month or so with big promotional fanfare (Vol. 10 :40-43) . Out of experience, he says company learned: (1) Color "identification" is all-important at this stage of its development and the company which lets consumers know that it's making and selling color sets, even in limited quantities, will have a big jump on its competitors. He stoutly defended his policy of full-page ads as necessary to "identification," said formula has proved successful, will continue until 85 cities have Motorola color sets. (2) Dealers are vitally interested in getting color on floor, to sell it for itself and as a stimulant to sales of black-&-white TVs and other appliances. He said other companies as well as Motorola had benefited from latter consideration. (3) Strong follow-up efforts by dealers will be necessary if color is to be sold on a mass market. "We've created the demand, but it's up to aggressive dealers to push the sales to the point of conclusion, " he commented. "We've found it's going to take an awful lot of selling, much more perhaps than we originally anticipated, but we definitely know the demand is there — it just needs exploitation." If he could start all over again, would Motorola merchandise color in same big-splash manner? "Definitely yes," he answered. "It's the right way to do it. In fact, I would broaden the base of the promotion and urge more dealers to join." Motorola this week lowered its color production goal this year by unspecified amount from original 20-30,000 estimates, pres. Paul V. Galvin explaining in letter to stockholders that company had difficulty acquiring components in July and fell behind in production as result. He explained: "When we launched our production in July, we encountered difficulties on the part of component manufacturers meeting our rigid specifications. This caused a delay in getting under way with production. We chose not to force this situation because we were determined to have high quality from the outset. As a consequence, instead of introducing and sampling in August, our introduction and sampling of color sets has been delayed until just about now. 10