Teens Are Primary Influencer on Holiday Technology Purchases; Survey Finds Teens' Purchasing Decisions Are Extremely Educated

NEW YORK--(BUSINESS WIRE)--Nov. 23, 2004--A new survey released today by Philips Electronics (NYSE: PHG) indicates that a large number of American teenagers frequently and consistently give their parents advice on what home electronics and technology products to buy. The advice that teenagers are giving parents is fueled largely by research they proactively conduct via the Internet and media, the survey found.

"This consumer demographic not only has significant purchasing power on its own -- twenty-five percent of survey respondents said they would spend between $100 - $500 for technology this year -- this survey shows they also influence how parents' money will be spent," said Scott Levitan, vice president of marketing, Philips Consumer Electronics, North America. "What's more, they are some of the most - if not the most - educated consumers you will find. That can make them an extremely tough audience."

Males & Females Are Equally Confident; Advice Levels Vary By Region

The Philips survey found that forty percent of kids ages 12-14 give parents advice on what to purchase "frequently" or "all the time." According to the survey, this advisory role increases with age: the percentage of kids who give advice "all the time" doubles from ages 12-14 to ages 15-17. The survey found that the frequency with which teens offer their opinions on technology purchases differs by region. Kids in the Northeast are the bossiest: Fifty-three percent of teens give advice "frequently" or "all the time." Those from the North central region are less vocal: Forty-three percent of kids in this region give advice "frequently" or "all the time."

Once the technology gets home, teens also frequently show parents how to use their new wares. Nearly fifty percent of teens surveyed said they show their parents how to use home electronics and technology equipment "frequently" or "all the time." Males and females are equally confident in providing this advice. Advice levels peak in households with annual incomes of between $40,000 and $50,000; fifty-five percent of kids in homes within this income range show parents how to use home electronics and other technologies "frequently" or "all the time." Meanwhile, sixty percent of families with incomes over $50,000 said they never give advice, or give it infrequently.

Extremely Educated; Celebrities Hold Little Sway

Surprisingly, the survey found that teenagers are doing a lot of research before buying or recommending a technology product. In fact, a whopping 65 percent of teenagers say their technology purchases are most influenced by information they get from the Internet or the media. Only 21 percent of all teenagers said they are influenced by celebrities, and the older a teenager becomes, the less likely they are to be influenced by the rich and/or famous. Twenty-six percent of teens ages 12-14 cite their favorite celebrity as a strong influence; but that percentage drops to just 15 percent for kids ages 15-17. Even so, over a quarter of all teenagers admit that movies influence their purchases.

"We have taken the time to study what is impacting teen purchasing," said Mathilde Beljaarts, manager of consumer and market intelligence, Philips Consumer Electronics, Amsterdam. "We continue to tailor our products and marketing to reach this demographic worldwide."

In an effort to better position itself with this audience, Philips Electronics has formed alliances with FoxSportsNet and SpikeTV to develop and produce TV shows filled with original content provided by Philips. The shows - Fusion TV and Shred Cafe - air weekly in the United States, and pull content from Philips' extreme sports sponsorships. Fusion TV features footage from action sports including motocross, skateboarding and wakeboarding. Shred Cafe, slated to air on Spike TV in the next year, includes similar footage as well as music and concerts to the teen audience.

Everyone Loves Music; MP3 Players Have Limited Audience

Not surprisingly, cell phones are the top-ranked, must-have technology item among American teenagers, but females clearly think it's a greater must-have than males: 55 percent of females said it is at the top of their shopping list versus 37 percent of males. Meanwhile, males think televisions are a top-ranked must-have (13 percent vs. 8 percent of females), as are MP3 players (21 percent of males vs. only 6 percent of females). However, music is important to males and females: stereos are at the top of both must-have lists.

Survey Methodology

The Philips survey was conducted by ICR/International Communications Research of Media, PA. The survey was conducted among a random nationwide sample of 513 teenagers (ages 12-17).

About Philips

Royal Philips Electronics of the Netherlands is one of the world's biggest electronics companies and Europe's largest, with sales of EUR 29 billion in 2003. It is a global leader in color television sets, lighting, electric shavers, medical diagnostic imaging and patient monitoring, and one-chip TV products. Its 164,500 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, semiconductors, and medical systems. Philips is quoted on the NYSE (symbol: PHG), Amsterdam and other stock exchanges. News from Philips is located at www.philips.com/newscenter