U.S. Drone Sales More Than Double Year-Over-Year With a Strong Start to 2017, Reports NPD

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Premium drones drive steady sales, while lower cost drones fly off shelves during the holidays

While 2017 will see mid-tier and entry level drones (priced under $300) continue to drive unit demand, new form factors and innovations in sensing and imaging technology will help meet the needs of premium drone buyers.

According to global information provider, The NPD Group, U.S. dollar sales of drones more than doubled in the 12 months ending February 2017, with a 117 percent increase year-over-year. While premium drones (priced $300+) fueled revenue growth, increased distribution and assortment during the holiday season helped drive unit demand for drones priced between $50- $100.

During the first two months of 2017, drones with a price tag over $300 drove 84 percent of dollar sales and nearly 40 percent of unit sales[1]. According to NPD’s Store-Level Enabled Retail Tracking data, in that time period, drones sold for $1,000+ saw the highest rate of sales, which identifies the fastest turning products, while drones sold between $300 and $500 had the second highest rate. When comparing items sold in the $300-$500 price range, there is a clear consumer demand for premium features. Drones with auto pilot capabilities sold nearly five times more quickly than drones without, while drones that feature follow mode functionality, which programs the drone to follow the user, sold 19x more quickly than drones without (two months ending February 2017).

“While 2017 will see mid-tier and entry level drones (priced under $300) continue to drive unit demand, new form factors and innovations in sensing and imaging technology will help meet the needs of premium drone buyers,” noted Ben Arnold, executive director, industry analyst for The NPD Group.

Premium drones drive revenue sales for the bulk of the year; however, during the holiday season drones with a price tag between $50- $100 saw a significant uptick in sales. From October to December, drones were more widely sold at technology retailers. In fact during this time, distribution, which is based on Annual Industry Volume[2], was up 5 points in the drone category and up 14 points for drones selling from $50- $100 versus the three months prior (July-September). This increase in placement helped drive sales of lower cost drones, resulting in $50- $100 models accounting for 42 percent of unit sales and one-quarter of all dollar sales during the three months ending December 2016. During the first nine months of 2016 drones in this price range accounted for 25 percent of all unit sales, but only five percent of dollar sales.

“In November and December, retailers adjusted their shelves to appeal to holiday drone shoppers,” stated Arnold. “Having a wide selection of brands and products, especially at opening price points helped satisfy drone gift demand.”

[1] Source: The NPD Group / Retail Tracking Service

[2] Annual Industry Volume (AIV) uses annualized store-level sales for a specific industry (or sub-industry), in this case the Total Imaging sub-industry within Consumer Electronics, as the weighting mechanism to report a product’s distribution in the marketplace. This offers a more precise measure of distribution than total sales of stores carrying those industry products (since most stores sell products across many industries).

About The NPD Group, Inc.
The NPD Group provides market information and business solutions that drive better decision-making and better results. The world’s leading brands rely on us to help them get the right products in the right places for the right people. Practice areas include apparel, appliances, automotive, beauty, consumer electronics, diamonds, e-commerce, entertainment, fashion accessories, food consumption, foodservice, footwear, home, mobile, office supplies, retail, sports, technology, toys, video games, and watches / jewelry. For more information, visit npd.com and npdgroupblog.com. Follow us on Twitter: @npdgroup and @npdtech.

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Megan Scott
The NPD Group
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