Why I Think the Prosumer Drone Will Never Die

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Why I Think the Prosumer Drone Will Never Die

Innovations will flourish on drones that target the prosumer market for a long time

THE FACTS:

In the 1980 book, The Third Wave, futurologist Alvin Toffler coined the term “prosumer” when he predicted that the role of producers and consumers would begin to blur and merge. Today, the term is well accepted as a descriptor for camcorders, digital cameras, and similar goods. Prosumers are enthusiasts who buy products (almost always technical) that fall between professional and consumer-grade standards in quality, complexity, or functionality. Prosumer also commonly refers to those products.

Recently, a well-respected analyst mentioned that his firm thought that prosumer drones would disappear from the market in the near future. At the time, I thought this quite bizarre—because our research says exactly the opposite. I’m still shaking my head.

Earlier this year, we 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 that reveals the buying patterns of both consumers and professionals.  The report has a detailed analysis that calls into question the commonly held and often undefined prosumer term. I’ll summarize the salient points of that research and offer insights into why I think the prosumer drone is here to stay.

WHAT BUYERS SAY:

We approached our research without preconceptions about commonly held terms used to describe drone segments or tiers, such as “consumer,” “prosumer,” and “professional.” Since all drones sold—no matter what the price point—are purchased by a consumer, we believe the best way to sort out these terms was by understanding the purchaser’s intended use. Our findings are summarized in the chart image in Table 1.

TABLE 1 – DRONE PRICE / MARKET SEGMENTS

price-chart-3

Source: Skylogic Research, LLC

As you can see from the chart, “prosumer” is—as we have defined it—a very narrow category and the majority of prosumer buyers purchase their drone with either civil / commercial or public / governmental use in mind. Overall, the data we collected from the quantitative portion of this study finds 61 percent of respondents said they purchased a drone in the $1,000 to $2,000 price range explicitly for professional use.

What is even more interesting is what respondents said they paid for their most recent drone.  Figure 1 shows those results. More than half of buyers purchase drones costing between $1,000 and $4,000.  We calculate that the mid-price range is $1,400.  Readers should note that $1,400 is the approximate cost of the popular DJI Phantom 4, Yuneec Typhoon H, and the just released DJI Mavic Pro, and together these brands account for approximately 72 percent of all drones purchased in the $1,000 – $2,000 price range.

FIGURE 1 – DRONE PURCHASE PRICE POINTS

WHAT OTHER ANALYSTS MISS:

  1. The Film/Photo/Video market is—and will probably always be—the largest commercial drone market segment. Our survey data going back to 2014 and even our most recent report confirms this. Most analyst forecasts—even at the large firms like Gartner, Teal, and PwC—don’t account for the full potential of drones in that segment, nor do they incorporate any first-hand knowledge from those who’ve already operated in that segment. The photographic, film, and real estate industries have known for years that small drones are a more viable and less costly substitute for manned aerial photography. It’s also no secret that this market is already established and towers above all others both in revenue and number of existing service providers (see what I wrote about that here).
  1. All the major mission planning and mapping applications like DroneDeploy, PrecisionHawk’s DataMapper, and Skycatch Commander (and dozens more) now run with the DJI SDK. Most of these started off with applications dedicated to their own drone but soon found that most professionals want to use the simpler and more reliable DJI prosumer drones.
  1. The prosumer drone category is the only place where sales volumes and margins are strong enough for manufacturers to recoup R&D investment. As I wrote about in Sense and Avoid for Drones is No Easy Feat, you can see this trend now with obstacle avoidance technology.

BOTTOM LINE:

Prosumer drones have already created new sources of demand for aerial imaging, and this will continue in earnest. As with land-based photography and video services, the financial and technical barriers to entry are low, making it easy for businesses to begin offering drone-based services. Now that the regulatory hurdle is low with Part 107, more new entrants will create demand for this segment.

Image credit: YUNEEC

This post first appeared on DRONELIFE.com

 

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8 Comments

  1. Hanno October 27, 2016 at 2:13 PM - Reply

    Great blog post. Thank you for this perspective. Would be great to have a cut of your Table 1 or Figure 1 by Manufacturer.

  2. […] be clear. This trend toward the use of prosumer drones for enterprise work is not going away anytime soon.  All the major mission planning and mapping […]

  3. […] Previous […]

  4. Matt December 3, 2016 at 3:55 PM - Reply

    It would be interesting to know where the purchase happens; and what is overall internet purchase percentage.
    Great article, thank’s for the info!

  5. JKWest January 3, 2017 at 1:31 PM - Reply

    Interesting article Colin. I have to agree with you 100%. Like a lot of people, I started out with very cheap drones. Each time I have purchased a new one though I have gotten one better. I have no doubt that I will one day be flying a drone costing over $2000.It seriously gets in the hobbyist’s blood and becomes an addiction. Just about everyone I know who ever bought a drone and had successful meaningful flights with it have gone on to buy more and better drones. Anyway, have a great day everyone, and keep ’em in the air!

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