Weekly television digest (Jan-Dec 1960)

14 • • • • APRIL 25, 1960 SIGNS & PORTENTS FOR A GOOD YEAR: Economic outlook for rest of year — from consumer buying standpoint — is picking up. The feeling of guarded optimism which prevailed during first quarter is giving way to more positive expectations of continued good business. While March TV-radio-stereo sales at retail probably didn't quite sustain sharp rise from 1959 shown by Jan.-Feb. figures (Vol. 16:16 pl6), preliminary first-quarter figures still show TV retail sales sustaining a 6.4-million-set pace on annual basis, with radio sales about 400,000 units ahead of first-quarter 1959. TV inventories were slightly over the 2-million level as of April 1, some 400,000 sets higher than the year-ago figure, which was considered too low and over-cautious. Industry statisticians call 2 million "safe." One particularly encouraging sign with coming of spring is that a dark spot on the home furnishings horizon seems to be brightening — the home-building outlook. An important factor in TV-set purchases as well as indicator of economic health, new housing starts rose to 93,800 in March from February's 74,400. Niunber of new housing starts still trails last year — but March's pick-up came in spite of unusually bad weather over most of country. Really encouraging are signs of expansion in home-loan commitments for first time since last siunmer, along with first indications of slight lowering of mortgage rates in some areas. United Business Service predicts at least 1.2 million new housing starts this year — only a modest decline from 1959's total of a little over 1.3 million. Almost all economic research services — which we scan weekly for trends — are now forecasting excellent retail business this year. Most of them see further gains in personal income, and outlook still is for all-time record retail sales. Wall Street Journal joined the spreaders of cheer this week, reporting in its April 22 issue on its own survey of more than 300 middle-income consumers in 15 cities. Journal found few signs of any slowdown in current heavy spending rate. Slightly more than 44% of individuals, it found, plan to make a major purchase (more than $150) during 2nd quarter; 43% made such purchases a year ago. "Consumers in the main," said the Journal, "seem almost unaffected by the prevailing uncertainties" (listless stock market, increased unemployment, lower steel output, etc.). Coming of spring, after a rough winter, seems to be reflected everywhere by strong consumer confidence. Thig rlimatp is ns pleasing to industry marketers as the first week of real sunny spring weather. 2.4 MILLION TV SETS SCRAPPED LAST YEAR: Gone, but certainly not lamented: 2,439,000 old TV sets in 1959 — replaced by new ones. It's estimated that another 3.4 million will fade away next year. Last year's scrappage figures — as estimated by Sylvania research dir. Frank W. Mansfield, chairman of ELA's statistical committee — dramatizes the value of the new-size 23-in. tube. For the first time, 21-in. sets account for fully one-third of all sets scrapped last year. Considering that about two-thirds of the 53.3 million sets-in-use now are 21 -in. sets, it's good bet that the 23-in. size will be big factor this year in inducing 21 -in. set owners to replace their big-screen sets — for it's axiomatic that the public likes to "trade up" to a bigger size. Breakdown of 1959 scrappage figures: 15-in. & less, 446,000; 16-18-in. 1,156,000; 19-21-in., 814,000; 22-in. & over, 23,000. In 1958 only 526,000 of the 2,010,000 sets scrapped were 19-21-in. (predominantly 21-in.). Last year's scrappage didn't quite set a record. In 1957, when 6,560,000 sets were sold at retail, a high of 2,750,000 old sets were junked. But percentagewise, 1959 was best replacement year— the scrappage figure indicating that about 42% of the sets sold at retail were for replacement.