We just released “Drones in the Channel: 2016 Market Report,” a research study examining drone sales and distribution channels in North America. It’s the first in-depth study of drone sales channels and reveals mixed distribution tactics as well as pinpoints market share of major UAV brands.
The report is a result of a three-month project sponsored by BZ Media. Incorporating qualitative research and including interviews with major drone manufacturers and drone distributors, the study also contains the results of a quantitative precision survey.
Among the many insights we got from the research, these two are
The survey found that the majority (52 percent) of people who purchase drones (at all price points) do so for photo and video taking—either for hobby or for commercial purposes. But drilling down, our analysis found that 75 percent of drones costing more than $2,000 are bought for professional use. This includes operations for public entities (such as federal and local governments, police departments, uniersities, etc.) and civil operations (which includes commercial and private industry operators).
The survey also found that across all brands and all price points, DJI’s share of the North American market is 50.1 percent. The devil, of course, is in the detail. As you look at detailed price points, DJI’s share is both higher and lower. For example, we found that in the $1,000 to $7,499 price range, DJI’s share is about 67 percent, but under $1,000, it’s only about 21 percent.
Sounds like Colin and his team used sound methodology and best practices, but there is no real news in the “free” part of the report – there may be some nuggets in the paid $495 version.
All you have to do is watch DJI’s pricing to know that the consumer sweet spot is as far under $1,000 as you can get it. This very much aligns with what Steve Petrotto of Horizon said on the panel that I moderated at the Drone Dealer Expo. Steve’s point was (and I paraphrase) that the vast majority of consumer users buy drones to
I think that the real issue here is camera quality. The low end of the market characterized by the Syma X5-C is HD. The key step up is to 4K.
Consider this quote from the wirecutter.com, one of many covering the space:
“Most of our surveyed readers—83 percent—considering a drone purchase told us they were interested primarily in photography and videography, so we concentrated on the most capable, most fully equipped camera-loaded models for your money: the DJI Phantom 3 Advanced (the successor to last year’s pick), the Yuneec Q500 Typhoon 4K, the Blade Chroma 4K, and the Parrot Bebop Drone.”
As you get above $2K a number of things happen – you can mount more different kinds of sensors, you can carry heavier cameras, you get more time aloft. And some birds come equipped for two man operation enabling the pilot and camera operator to share a feed and work together.
As for the insight into DJI’s actual market share. It’s interesting but hardly surprising for two reasons. First, estimates of DJI’s market share have been based on 333 exemptions which only reflects the commercial end of the market. This survey apparently included both consumer and commercial buyers – so that DJI lost considerable ground in the sub $1,000 category is hardly surprising.
Secondly, DJI has had very little in the sub $1,000 category until recently – they are dominant where they offer a broad assortment and are less so where they don’t.
The larger problem for the industry is that there is no standardized reporting like what Billboard does for record sales or various market research firms do for automobiles.