August 20, 2007 1:20 PM PDT
The secret of Vizio's success
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Vizio tops in LCD TV sales in second quarter
August 20, 2007
The LCD TV maker has quickly staked out a place in the flat-panel market and has elbowed aside some of the biggest names in electronics in the process.
For all the clout and brand recognition that accompanies names like Sony and Samsung, it was Vizio, a virtual unknown a year ago, that topped all LCD TV makers in the second quarter of this year in televisions shipped to retailers. Vizio sold 606,402 TVs in North America in the second quarter, a 76 percent jump from the previous quarter, according to a report by iSuppli released Monday. That puts Vizio in first place among LCD TV vendors, with a market share of 14.5 percent, up from 9.4 percent, or fifth place.
Former market leader Samsung dropped to second place, shipping 467,210 units compared with 445,683 the previous quarter. But the company that took the biggest dive was Sony, which fell from third to sixth place, moving just 253,377 units, compared with 412,232 last quarter.
"We are more of a threat to them (Sony and Samsung) than we were before," Vizio CEO William Wang said in an interview with CNET News.com.
The biggest reason for Vizio's sudden rise is its distribution strategy. At the beginning of the second quarter, the company expanded its list of retailers to include Wal-Mart Stores, Sears, Kmart and Circuit City, providing a huge boost to its shipment total, according to Riddhi Patel, an analyst with iSuppli. The company started by selling TVs only through warehouse stores Costco Wholesale and Sam's Clubs.
In addition, the quality of Vizio LCDs looks very similar to the Sonys and Samsungs on the store floor--and the price is significantly lower, according to Patel.
"Say (consumers) have a budget to spend $1,000 on a TV. They could probably buy a premium brand 32- or 37-inch, or they could buy a Vizio 47-inch for the same amount," Patel said. "The low-price strategy is what's driving consumers to them."
Much of the sales have been word-of-mouth endorsements. Vizio has done little in the way of advertising. But that's about to change come this fall, Wang said. The company is prepping for a big marketing push when the new National Football League season kicks off next month. The ad campaign attracted a big-name spokesman, too: last year's league MVP, LaDanian Tomlinson of the San Diego Chargers.
"Our focus has been growing our brand awareness," Wang said. "We're not holding anything back."
The advertising, of course, will be done in true Vizio style: the budget will be less than 1 percent of overall spending.
"Do we need it? It's really hard to have a real scientific answer. Our goal is not to be just a fast mover for TVs, but to build a really great consumer electronics brands, not just TVs," Wang said.
Two years earlier, in the second quarter of 2005, Vizio was ranked No. 15 in North America, according to market research firm DisplaySearch. (Polaroid, another relative newcomer to TVs, saw its market share in LCDs grow 118 percent and rise from 4 percent to 7.5 percent.)
The growth came at the expense of more traditional manufacturers like Philips, Funai (which makes Sylvania brand TVs) and Sharp. These companies did not grow as fast as the market. Philips actually saw a decline in flat-panel TV shipments in North America.
Though many of the new brands are trying to expand internationally--Westinghouse and Syntax-Brillian sell TVs in Asia, for instance--Vizio says it's staying put in the U.S. for now.
Vizio's strategy essentially revolves around trying to have the cheapest TVs in the mid- to high price range. Acer has used a similar strategy to move up rapidly in the PC business. Additionally, Vizio tries to project itself as the company that can provide better and more personal service. TVs are packaged with poster-size service guides. It also offers free in-home support during the warranty period and a "no bright pixel" guarantee for the life of the product for many TVs. Bright pixels are faulty pixels that become a pinpoint of light on a TV's display.
The Costa Mesa, Calif.-based company started as a consulting firm in 2003. Wang had worked at several Taiwanese LCD makers and decided to branch out on his own. One of the company's first engagements was helping Gateway put together its 42-inch plasma TV system, priced at a then-startling $2,999. Comparable systems at the time sold for upwards of $6,000. Although Gateway's momentum in TVs petered out, it enjoyed a surge of sales and attention with that low-priced TV in 2002 and caused other manufacturers to cut prices.
"They sold over 4,000 in the first month. It was pretty exciting," Wang said in an interview in January.
See more CNET content tagged:
Vizio,
TV company,
LCD TV,
iSuppli Corp.,
LCD
just price a vizio 42" panel on CNET's price comparison in the link above.
Ours has been great.
My colleague's died just after the 1 year warranty expired and do you know what?
Vizio STILL replaced it.
As far as I'm concerned, that speaks very positively about them. They could have legally put the screws to my colleague and they didn't.
I'll be going back to these guys.
Charles R. Whealton
Charles Whealton @ pleasedontspam.com
But if you have to deal with the Vizio people directly, or think you might have to, do yourself a HUGE favor and STAY THE HELL AWAY! They are the rudest, most retarded, most uncooperative bunch of people I have ever dealt with. Add to that that their systems seem completely broken and it's an almost shockingly bad experience.
If you get your TV at all, without any problems, you can count yourself lucky.
If Sony was the only product on the shelf then I just wouldn't buy. Everything that I have had that has been Sony has broken just after the warranty and then to get it repaired costs almost if not more than just buying another.
Samsung I like but they have been "jacking up" their prices lately. They are still a good product but just a bit more than I want to spend. So have I bought a vizio yet? No. Will I? Probably because whenit comes down to it most of what you are buying today is only module repairable and their are only a few modules in an LCD or Plasma set so unless you're lucky enough to just have the power supply go out then you are SOL. So why not buy Vizio or Westinghouse or any of the other lower end sets. You could buy two or three of them for the same price as you would pay for a Sony, Pioneer, or Samsung.
And don't start getting into the fine detail specs either because those specs don't last long and I don't mean the resolution or connections I mean the contrast ratio, dead pixels, etc.
Yes.
Can you get a better display or feature set for a similar price?
Nope.
After being a Sony man forever, I dumped them for company that balances features and price in a very nice way.
real difference to the average eye. None. Besides, you know the
customer service you'll get with Sony: BAD. Why NOT take a chance
on the new guy --at a lot less money? Its a no-brainer.
Because we stupidly threw away the box, we were unable to take it back and get a new one when it stopped working (a few days after the warranty expired.)
VISIO refuses to provide component level schematics, so their products can be repaired only by very expensive board swaps.
When they work, they are great, but KEEP THE BOX and buy from a store like COSTCO with a good return policy.
They products look great (granted, they are super shiney and sleek) but they DO NOT LAST. This comes from a guy who owned a Vaio, PSP, Cybershot, etc....Sony = never again.
outrageous price (then) of $1899. I was running satellite HD
through it and the Vizio had a tough time reproducing black
levels, plus SD channels has a lot of false contours (banding)
which looked pretty bad.
I wound up returning it 9 months later -- yay, Costco -- and
buying competitors' products until I would up with a Panasonic
42" plasma, which is great. But I notice when I go into stores
that the Vizios today are far bettter in contrast and color than
those of even a year ago.
Keep up the good work, Vizio, you're putting pressure on all the
other display manufacturers to make better and more affordable
products!
- Good ole Statistics...
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by ev61
August 26, 2007 10:45 PM PDT
- Aside from the obvious picture quality difference between Vizio and the Sony/Panasonic/Pioneer sets is a huge error in the story. "Televisions shipped to retailers" is the most ludicrous statistic ever. Go to a big box electronics store and ask for a Pioneer Elite or a Panasonic Pro model and they MIGHT have a single one in stock. There will be 2-3 in the regional warehouse and will be shipped from there. Goto any Costco, Sams's, etc. and pick out your very own Vizio and you have your pick from a stack of one hundred. Vizio's shipped back will be ten fold as well. I am a quite disappointed in CNET for letting this one slide...
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