Electronics grow more elaborate as we embrace 'local area nesting'
By Mike Snider
For Todd Skelton, there's no place like home. The 37-year-old automotive executive has gone to extremes in outfitting his Palm Beach, Fla., home with a full complement of entertainment gadgets, including an automation and security system, and a theater with three rows of seats for him and his wife, relatives and friends to watch DVD movies on a 12-foot screen.
Although the work was finished in July, Skelton said, the home theater has been a particular source of comfort for his family including stepchildren and their kids since the Sept. 11 attacks. "It seems to me that there's a big shift toward spending more time at home,'' he said.
Some trend spotters call it "cocooning,'' others call it "nesting.'' But the movement toward spending more time at home and feathering our nests with more elaborate and entertaining diversions may be more than a fad.
That, at least, is the hope of the makers and sellers of digital entertainment gadgets. Even though overall electronics sales dipped slightly in 2001, according to numbers released in January at the Consumer Electronics Show in Las Vegas, sales of DVD players, digital TVs and home theater packages spiked significantly and are predicted to continue their rise this year.
Consumers "want to stay in contact with loved ones. They want to be entertained. They want to have an escape, a diversion through home entertainment,'' said Jeff Joseph of the Consumer Electronics Association.
The terrorist attacks may not have started the trend toward cocooning, but the events of the past few months have given it added momentum. "People were looking to balance their lives more coming out of the late '90s into the new century as the dot-com economy started to crash,'' said Cary Silvers of the consumer research firm RoperASW. "People were starting to spend more time with family, usually at home.''
But since the attacks, people "are keeping to their safe havens,'' he said. Roper even has coined a term for the trend: "local area nesting.''
A recent Roper phone survey found that nearly one in four people intend to spend more on entertainment for the home this year "a significant number,'' Silvers said. "And it has already been on an upward trend.'' More than 25 percent intend to rent more movies.
About 30 percent say they'll spend more on technology to keep them connected to family and friends. And in other surveys since Sept. 11, 29 percent of people said they were more likely to spend even more time at home and 27 percent were more likely to attend church or synagogue. That suggests nesting doesn't mean simply hunkering down and shunning the world.
'Home is the comfort zone'
"People are rediscovering their local community,'' Silvers said. "But the home becomes the center, almost like nuclei. ... The home is the comfort zone.''
Family therapist Evan Imber-Black isn't convinced that cocooning will become instilled as long-term behavior. "At the beginning, people were staying put and investing in things they could do at home,'' said Imber-Black, of the Ackerman Institute for the Family in New York. "But it seems that was a more temporary thing. People are out again.''
On the other hand, Imber-Black and her husband did buy a DVD player over the holidays and a second one for their son. "We were looking into that way before 9/11 and just decided this year's Christmas was the time to get it.''
As for "local area nesting,'' she said: "I think it remains to be seen. What we have seen in many families is a desire to connect with extended family to do work to repair certain relationships.''
But Neil Strother, a tech analyst with Scottsdale, Ariz.-based market research firm Cahners In-Stat, thinks the plugged-in nest may have staying power. Consumers have decided to "stay home a little more and are doing more low-end purchases, maybe getting a (Nintendo) GameCube or (Microsoft) Xbox instead of a PC,'' he said.
And after several years of increased importance for personal computers and home information, "the television is becoming more important in the home again,'' said Dave Arland of Thomson Consumer Electronics, which makes RCA products. "People are spending more time in front of the tube.''
That may or may not be a healthy development, said Shirley Glass, a Baltimore-area psychologist and marital therapist. "If people are buying more equipment for home entertainment, does that result in family time, or is it creating something where each person is more in their own hives within the cocoon?''
Expanding on entertainment
She has childhood memories of a neighbor who had the first television on the block, who hooked the set to an extension cord and put it on the lawn. Neighbors brought out chairs and watched a Joe Louis boxing match. "Maybe this is the 21st-century version,'' she said. "People who have huge home entertainment systems often share them with friends and neighbors. Then it becomes a very nice social thing.''
For much of the past decade, home PCs and other information appliances helped propel sales of electronics. But in 2001, PC sales dropped about 13 percent and are expected to decline again this year, according to factory sales figures.
"Entertainment was the winner in 2001,'' Strother said.
Holiday sales at Denver-based Ultimate Electronics suggest that buyers are still focusing on the home. "People are a little more selective about their purchases, and I think we are in favor with the consumers now,'' said Dave Workman, president of the 36-store chain.
The low-priced DVD players that appeared over the holidays some selling for less than $100 helped fuel consumer interest.
Entry-level home theater surround-sound packages dropped to as little as $300, while systems complete with DVD players are being introduced at the show for as little as $350. Big-screen digital TVs, including sets that can display the high-definition broadcasts slowly being rolled out by the networks, have slid from $3,000-plus to less than $1,800.
"Three or four years ago, home theater was thought of as something rich people went out and bought. Now more people look at it as a way to expand on their television,'' Workman said.
With more than 25 million DVD players sold in less than five years, the product has become the most successful consumer electronics product ever, adopted more quickly than televisions, CD players or satellite TV systems.
The industry would like to reach a similar critical mass soon in digital TV. Already about 225 broadcast stations are transmitting DTV signals, some in the high-definition format that offers far more clarity than current broadcasts, in a cinema-like wide-screen format. Satellite TV services DirecTV and the Dish Network also offer high-definition movies and programming. But copy-protection issues in Hollywood and compatibility battles with the cable TV industry have slowed the rollout.
Consumers ready for future
Nonetheless, consumers are moving to the new high-tech sets in anticipation of the future. Sales of regular, nondigital TV sets have decreased for two-straight years, while sales of digital sets nearly doubled last year. (Sales of nondigital sets still outnumber sales of digital models 15 to 1.)
Installers of custom home theaters report lots of interest among consumers. In a recent survey, installers say they expect business to increase 25 percent to 30 percent next year, compared with the 15 percent to 20 percent increase that has been standard over the past five years, according to the Custom Electronics Design & Installation Association.
That's certainly true at Skelton's West Palm Beach home.
"There's a certain level of comfort in your home,'' he said. "It's always been difficult to get me out of the house, but I used to feel like I needed to get out of the house. Now, I want to do everything to avoid getting out of the house.''