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Weak TV Sales May Benefit Buyers

If Best Buy’s quarterly earnings report is any indication, there’s one gift that may not be under many a tree: flat-screen TVs. But experts says that could benefit cost-conscious buyers in the New Year.

Demand for TVs has been low all year, with shipments to North America down 4% during the first three quarters, according to Display Search, a division of market research firm NPD Group. The Consumer Electronics Association expects sales to drop another 2%, to 32.6 million in 2012.

“Obviously most people have purchased their high-def sets,” which has slowed demand, says CEA spokesman Steve Kidera. Much of the current sales are people buying second or third sets for other rooms in their home. Sales of connected TVs and 3D sets are also growing among buyers replacing their primary set, he says.

But stores’ big holiday sales have largely focused on high-end TV models, which is adding to the inventory glut, says Dan de Grandpre, chief executive of sale-tracking site DealNews.com. “People looking to buy a second or third set, maybe for the kitchen or bedroom, want a cheaper set,” he says. Look for sales on those high-end models to get even bigger through January, especially after the International Consumer Electronics Show in early January, when many manufacturers unveil the new models that will be on shelves by mid 2012, he says.

TVs that retail for $500 or less may also see more sales, but probably not until March, de Grandpre says. There’s less profit margin on those sets, which means retailers can’t be as competitive on them. But at that point, fancier models may be on closeout for just a little bit more.

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