Don't say we didn't tell you so. WhenNFTpublished the results of our inaugural Ceramic Tile Market Trends Study more than three years ago ("Does Ceramic Tile Deserve a Bigger Slot in Your Product Mix?" June, 1999), we spotlighted a variety of statistics -- as well as the direct input of hundreds of floor covering retailers and distributors -- to support the thesis that ceramic tile represents a product segment with possibly the greatest near-term growth potential in the industry.
The findings of our newly released 2002 ceramic study, when compared to the benchmarks established by the 1999 and 2001 ("The Ceramic Tile Market for 2001: A Comprehensive Study" May, 2001) editions of the survey, reveal that we were pretty much dead on in our prognostications.
Slightly more than half of this year’s respondents (54 percent) expect that increase to be in excess of 10 percent. And 15 percent anticipate sales growth of more than 20 percent (see chart 1). These results remain fairly consistent with the findings of previous NFT ceramic studies. In 1999, 58 percent of participants expected a better than 10 percent sales boost. Last year, 57 percent forecast a sales increase of at least 11 percent.
Hottest tile types and sizesAs in past years, floor tile is the product format most frequently sold by survey respondents, followed in descending order by wall tile, countertops and backsplashes, trims and decorative tile, and exterior tile (see chart 2 for specific percentages).
In our first two surveys, the most frequently sold tile size -- accounting for approximately half of sales -- was 12-inches square. In both of those surveys, 13-by-13-inch format followed 12-by-12-inch size as the best seller.
For the 2002 survey, we looked at that question from the separate perspectives of floor and wall tile. This year, 52 percent of participants said 12-by-12-inch tile is the best-selling size of floor tile, followed as in past years by 13-inch-square format (31 percent). When it comes to wall tile, 8-by-10 inch is identified as the top seller by 29 percent of respondents. Nineteen percent said 4-by-4 inch is their best seller and another 19 percent said 6-by-6-inch format is selling most.
According to our survey, the top-selling sizes are unlikely to change over the next 18 months. Thirty-seven percent of respondents believe 13-inch-square format will be their best selling size and 28 percent think 12-by-12-inch tile will be the sales champ over the next 1 1/2 years.
Porcelain solidifies its gainsAccording to our 2002 study, the proportion of porcelain tile sales have increased significantly over the past several years (see chart 3). This year, 40 percent of respondents say that porcelain accounts for 26 to 50 percent of their total tile sales. Twenty-one percent report that porcelain makes up the majority of their ceramic sales.
In 1999, 11 percent of survey participants said porcelain accounted for 26 to 50 percent of sales, and only 6 percent said the product represented more than half of their sales. Those proportions increased in our 2001 survey, with 20 percent saying that porcelain accounted for just over one-quarter to half of their tile sales and 7 percent crediting porcelain for more than half of their tile sales.
Porcelain’s market share is likely to continue its growth, if our 2002 projections are on the mark. Sixty-eight percent of respondents expect an increase in porcelain sales over the next 18 months compared to 31 percent who expect sales to remain flat and a mere 1 percent who foresee a porcelain sales decline.
Impact of the importsImported tile continues to account for most U.S. tile sales (see chart 4). This year, domestically produced tile, which accounted for 37 percent of sales, recaptured two percentage points of the market share it lost to foreign producers in 2001. However, U.S. tile producers are still short of the 42 percent market share they held in 1999.
Survey participants said most of their imported product originates in Italy (48 percent), followed by Spain (22 percent), Mexico (11 percent), Brazil (7 percent), and Turkey (5 percent). Furthermore, they expect these importers to maintain their current rankings and market share, except for Mexico which is projected to decline to 10 percent over the coming 18 months.
Freight costs and import duties do not have an overwhelmingly negative impact on survey participants’ choice of an imported product over a domestically manufactured tile. Seventy-four percent reported that duties have no bearing on their decision to sell imported tile, and 64 percent said freight costs play no role in their choice of an imported product.
Whether domestic or imported, our survey indicates that most ceramic tile in this country is sold to floor covering retailers, followed in descending order by tile contractors, consumers, builders/developers, architects/designers, and big-box home centers (see chart 5 for specific percentages). And respondents don’t expect these rankings to change over the next 1 1/2 years.
These are but a handful of the intriguing findings uncovered in NFT’s 2002 Ceramic Tile Market Trends Study. Retailers who remain uncertain about ceramic tile’s prospects in the U.S. marketplace might benefit by taking into account the data compiled in our three ceramic surveys before drawing conclusions. With access to this exclusive information, you may yet be able to make the trend your friend.
Our 2002 ceramic tile market findings are based on responses from a representative cross-section of flooring retailers and distributors. The study was conducted by the market research staff of Business News Publishing Co. in conjunction with the NFT editorial staff. A sample of 1,000 active, qualified floor covering dealers/contractors was selected on an Nth name basis from the domestic circulation list of NFT subscribers, and an additional 323 survey recipients were culled from the ranks of distributor members of the Ceramic Tile Distributors Association. The study had a 16 percent response rate.
The complete 2002 Ceramic Tile Market Trends Study is available for $225 each or $195 each for multiple copies.
Among the topics covered are: percentage of residential vs. commercial ceramic tile sales; percentage of total ceramic tile sales sold direct to consumers through the showroom; percentage of ceramic tile sales by product format; percentage of ceramic sales that are porcelain tile; the size of floor and wall tiles sold most frequently; percentage of ceramic tile sales according to end user; percentage of sales of imported tile vs. domestically manufactured tile; and the most popular sizes and dollar volume of stone tile sales.
Additional survey questions addressed sales projections for the next 18 months, sales of imported tiles broken down by country of origin, the impact of import duties and freight costs, and demographic information on survey participants.