Television digest with AM-FM reports (Jan-Dec 1950)

WITH AM-FM REPORTS WW CWWICTICUT AVE. N.W. r WASHINGTON 6, D. C. • TELEPHONE MICHIGAN 2020 Trade Report November 11, 1950 SET SALES DIP IN MARKET REACTION: Many "soft spots" are rearing their unwelcome heads on TV sales maps — some of them very soft, indeed. Reaction has set in, apparently, in wake of lush pre-excise tax trade. Sales are dropping. There's no mistaking dip since Nov. 1 — but it was more or less expected. It was almost too much to expect receivers to continue to move at such swift pace indefinitely. Consensus seems to be that Thanksgiving-to-Christmas will see boom trade again. After that — the effects of shortages, induced by govt, restrictions and war orders, may serve to put a brake on boom TV production anyhow, some say. * * >1= * Regulation W, higher prices and color are the prime retarding factors. The first is being countered in various ways, chiefly "layaway" plans ; second has been forced by higher costs and new tax. Color is said to be keeping some people from buying — but leading more to "buying down." "Buying down" means customer is inclining toward low-end items, telling clerks: "Why spend $500 and $600 for a set when I'll probably buy a color set soon. No, I think I'll keep this purchase as low as possible." Biggest single factor is credit controls, though there's still plenty of purchasing power and upper-class trade that can pay cash or fork out the higher down payment. Gaining in popularity is the "layaway" idea (Vol. 6:42) by which customer puts down as little as $1 to $5 and store holds set until, through weekly payments, required 25% down is paid; then he gets set, keeps up required 15-month payments. Rash of "Buy Now Before Excise Tax" ads pre-Nov. 1 has been followed up by ads offering "No Tax on Inventory, We Sell at Pre-Tax Prices." How long this can continue, is questionable. Also, there's fear public will react unfavorably. Home furnishings trade reports dollar volume for first 5 selling days in November ran 20-25% behind same time last year, TV sales for all October 2-3% behind last year. "With the excise tax buying spur no longer a factor," reported Nov. 8 New York Times, quoting head of one important store, "retail TV sales are again at a standstill." * * * * Color impact is deemed secondary. In Los Angeles' big Barker Bros, store. Tele-tone showed its "slave" unit for color conversion and got this reaction, according to Nov. 7 Retailing Daily: Set-on-top-of-set unattractive, picture too small [IVi-ln. magnified), promised price of "under $200" not too bad. Observed Hoffman Radio's Leslie Hoffman, visiting in East a few days later: "It sold a lot of black-and-white sets." It's his belief black-and-white sets, placed and priced alongside converted and/or color sets, will gain by the comparison and that the industry is doing too much "talking down" color, not enough "talking up" present product. * ♦ ♦ * Meanwhile, nobody is talking cutbacks in production — except as these may be forced, involuntarily, by raw materials restrictions and components shortages. As matter of fact, every TV-radio factory is still turning out every set it can, while anticipating the worst. To meet components shortages, imports from Canada are increasing, and several companies have sent emissaries to Europe to seek out components. Said to be in plentiful supply at moment are cabinets and CR tubes. First November week's output, reported by RTMA for entire industry, went to 218,578 TVs, exceeded as record by only one October week (Vol. 6:44) and bringing 1950 production thus far to just about 6,000,000. Radios totaled 365,751. also exceeded as record by only one October week. 10