Consumer Audio Market

Market Overview

The global consumer audio market size was valued at USD 99.71 billion in 2023. It is estimated to reach USD 303.61 billion by 2032, growing at a CAGR of 13.17% during the forecast period (2024–2032). The introduction of voice first and technology and its surging consumer adoption are driving the global consumer audio market. Additionally, the gaming industry's flourishing demand for consumer audio products such as headsets and microphones is further fueling market growth. Furthermore, the key players in the market are involved in several strategic initiatives to enhance their market share, in turn creating opportunities for market growth.

Consumer audio refers to audio products and technologies designed for personal use by everyday consumers rather than professional or industrial applications. This category includes a wide range of devices such as headphones, earbuds, portable speakers, home stereo systems, soundbars, and smart speakers. These products aim to enhance the listening experience of music, movies, podcasts, and other audio content by delivering high-quality sound in a user-friendly manner.

The market has seen significant advancements in recent years, with innovations like wireless connectivity, noise-canceling technology, and smart features integrated with voice assistants. Brands like Bose, Sony, Apple, and JBL are prominent players in this space, continuously striving to improve sound quality, battery life, and overall user experience. As the demand for high-fidelity audio grows, consumer audio products are becoming more sophisticated, offering features that cater to the evolving preferences and lifestyles of users.

Highlights

• Headphones dominate the product segment.
• Wireless dominates the connectivity segment.
• Commercial dominates the application segment.
• North America is the highest shareholder in the global market.

Market Dynamics

Global Market Drivers

Popularity of Voice-First Technology

Voice-first technology is used mostly by the current generation, which is growing around devices that can reply to queries. Voice control has quickly become the norm for consumer electronics, including smartphones, tablets, laptops, and wearable tech. Voice-first technology significantly impacts consumers worldwide, especially in developed parts such as the US and other European countries. Moreover, in the current scenario, it is finding its application among consumers and becoming the mainstream technology used in several consumer devices.

One such embedment has been observed in various product segments of consumer devices such as speakers. Voice-first devices include voice-assistant speakers such as the ones offered by Amazon (Echo, Echo Dot, and Tap) and Google (Home) and allow the voice command capabilities to be applied directly. The next generation of consumers would expect AI voice interaction. Over 50% of all human interaction with computers will be voice-assisted by 2025. This, in turn, will drive the global consumer audio market growth in the coming years.

Rising Demand from the Gaming Industry

The gaming industry has become a significant driver for the consumer audio market. Gamers demand high-quality audio for an immersive gaming experience, leading to the development of specialized gaming headphones and audio accessories. The video game industry is amongst the fastest growing in the world. According to Statista, the global video game industry has been a multibillion-dollar business for decades.

The global gaming market was projected to bring in 347 billion dollars in revenue by 2022, with 248 billion coming from the mobile gaming sector. Additionally, the growth of the gaming industry supports the sale of gaming accessories, including gaming microphones and headsets. Gaming headsets provide better features than ordinary headphones, such as clearer sounds, real-life 3D sound quality, and noise-canceling for comfortable communication. Moreover, gaming headsets also consist of a mic on that pair for communication. Consequently, such factors propel the global consumer audio market.

Global Market Restraint

Acoustic Challenges Related to Consumer Audio Devices

Many acoustic challenges are associated with the design and layout of the location or place where consumer audio devices need to be fitted and offer quality outcomes. An acoustic challenge can occur due to the unique design or architecture of the place. Legacy systems cannot handle or meet the expectations of a wide array of performances in modern-day theaters, houses of worship, or halls. Before considering the design of an audio solution, it is necessary to create a link with the physicality of the space. This is a major challenge for the global consumer audio market.

Global Market Opportunities

Strategic Initiatives by Key Players

The key market players are involved in several strategic initiatives like joint ventures, acquisitions, expansion, product launches, etc. For instance, in June 2022, a leading private investment firm, Highlander Partners, L.P., announced today the acquisition of McIntosh Group via a newly formed holding company. McIntosh Group, which currently manufactures and distributes under several renowned brand names the world's finest amplifiers, speakers, turntables, and other audio products, has been an industry pioneer and leader in high-end consumer audio for decades.

Similarly, in May 2023, Samsung Electronics America unveiled the latest inclusion in their soundbar portfolio for 2023, namely the HW-Q900C. The soundbar is part of a range of devices that offer distinctive features designed to enhance the audio experience and offer users a wider range of choices. The HW-Q900C belongs to Samsung's prestigious Q-series lineup, which encompasses high-end soundbars meticulously designed to deliver exceptional audio performance characterized by robustness and an immersive auditory experience. Thus, such initiatives are estimated to create opportunities for market growth.

Regional Analysis

North America Dominates the Global Market

Based on region, the global market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

North America is the most significant global market shareholder and is expected to expand substantially during the forecast period. Factors such as high spending power, increased smartphone adoption, inclination toward new technology, and high urbanization are driving North America's market growth. The millennials mainly drive the market, and they can be termed as a digital generation as they are tech-savvy, and most of them are addicted to their smartphones. In 2019, about 96% of the US population was estimated to listen to music and spent more than 25 hours a week. Similarly, more than 1.15 trillion on-demand tracks were streamed in audio and video format across several platforms in the country in 2019. The trend of on-demand streaming is boosting the sales of the consumer audio market in the region. Additionally, the US is witnessing the greater use of voice technology in facilitating e-commerce. The total voice commerce market value in the US is expected to reach USD 45 billion by 2023. These factors are expected to drive the demand for smart speakers, which, in turn, will drive the market revenue for consumer audio during the forecast period.

Moreover, there has also been a surge in the launch of consumer audio devices in the region. For instance, in April 2023, Focal replaced its Chora lineup with a new line of entry-level speakers. Compared to its predecessor, the Focal Theva features a more streamlined cabinet design and new color options. According to Focal, every speaker is optimally designed for home theater and music listening. Six new speakers have been added to the lineup and are expected to appear by the end of the month. Focal Theva made its public début at Axpona (Audio Expo North America) in Chicago, Illinois, from April 14-16, as announced by the company. Consequently, all these factors are anticipated to expedite the expansion of the North American consumer audio market.

Asia-Pacific is home to the most rapidly expanding gaming community globally, with South Korea, China, and Japan at the forefront. The proportion of Chinese citizens who identify as gamers stands at 64 percent. Due to its substantial populace and overall economic growth, more individuals can procure games and gaming equipment. Asian enthusiasts allocate USD 12 billion annually towards mobile games, with South Korea and Japan ranking first globally in average game spend per user. The group's responsiveness will result in significant sales growth for both endemic and non-endemic gaming products, with gaming headphones and audio accessories being particularly noteworthy accessories utilized in gaming. This, in turn, will propel the market forward.

Furthermore, the rise in advancement has led to the introduction of smart consumer audio technology in the region. For instance, in October 2023, Sonos, a renowned brand in the realm of audio devices, introduced the Era 30o and the Era 100 smart speaker models in the Indian market. Both speakers belong to the premium category and are characterized by their emphasis on sustainable design. The smart speakers are composed of plastic derived from post-consumer recycled (PCR) materials and are packaged in fully recyclable materials. There is a notable decrease in the utilization of adhesives, with a shift towards the adoption of screws to facilitate ease of repair. Such launches are estimated to boost the Asia-Pacific consumer audio market expansion.

Segmental Analysis

The global consumer audio market is segmented by product, connectivity, and application.

Based on product, the global market is divided into microphones, soundbars, speaker systems, headphones, and headsets.

The headphones segment is the most significant contributor to the market. Headphones are over-the-ear audio devices for listening to recordings, music, or other types of sound. They typically comprise a headband-connected pair of earpieces, with a speaker driver integrated into each earpiece for sound production. Various designs and varieties of headphones are available, such as over-ear, on-ear, and in-ear forms. Headphones can be wired or wireless, with wireless options connecting to audio sources via technologies such as Bluetooth. In addition to private listening and professional audio monitoring, they are also utilized for communication and gaming. The key players are launching innovative and technologically advanced products in the market, boosting the segment growth. For instance, in September 2023, Dyson, a British technology company, declared its foray into the wearables sector within the Indian market by introducing a line of noise-canceling headphones.

Based on connectivity, the global market is divided into wired and wireless.

The wireless segment dominated the global market. Wireless consumer audio devices encompass electrical equipment specifically engineered for audio playback or communication, eliminating the necessity for physical wires. These gadgets employ wireless technology to facilitate the transmission of audio signals among various components, granting users the liberty to move about without the constraints imposed by physical cables. Bluetooth is the prevailing wireless technology employed in consumer audio devices. At the same time, alternative technologies like Wi-Fi and proprietary wireless protocols are also utilized, contingent upon the specific device and its intended purpose. Additionally, the new product launches in this segment are expected to augment the segment's growth. For instance, in India, Blaupunkt, a German electronics and audio manufacturer, introduced the 220Watt SBWL100 Dolby Soundbar this week, targeting OTT enthusiasts. According to the manufacturer's assertion, the wireless soundbar, possessing a capacity of 220 watts, ensures the provision of robust bass and pristine audio quality.

Based on application, the global market is bifurcated into education, commercial, retail, commercial, government, industrial, and hospitality.

The commercial segment is the highest contributor to the market. Commercial environments frequently employ consumer-grade speakers and amplifiers to power public address systems. These systems find application in airports, malls, retail establishments, and other public areas, serving functions such as announcements and background music. Numerous establishments employ consumer audio devices to provide ambient music. Home-use speakers and audio systems are typically utilized in offices, cafes, restaurants, and retail establishments to create a welcoming environment for patrons and staff. Although consumer audio devices may not consistently exhibit the same degree of longevity or audio quality as commercial-grade equipment, they frequently remain more cost-effective. They can fulfill the requirements of particular commercial applications.

Recent Developments

• January 2024- Ceva and THX have partnered to bring premium spatial audio experiences to a wider range of consumer devices, including TWS earbuds, wireless headphones, smartphones, speakers, and soundbars. This collaboration aims to enhance immersive audio for consumers in the global consumer audio market through Ceva's RealSpace® technology tuned by THX.
• November 2023- HARMAN, a leading audio technology company, has acquired Roon, a popular multi-device, multi-room audio platform. This strategic move strengthens HARMAN's position in the global consumer audio market by expanding its ecosystem of high-performance audio devices and enhancing its music management and discovery capabilities for music enthusiasts.