Getting to One Million Sold
A sign of the growing business interest in 3D Printers is that I had three conversations this week with venture capitalists who are trying to figure out this market. (Word is that MakerBot is out raising a new round of financing, after having raised $10M in 2011.)
How big will 3D printing become? How many will be sold? How long will it take before there are 1M households with 3D printers. I remember asking a large audience how many owned a 3D printer? Only a very few hands went up. When I asked how many wished they owned a 3D printer, nearly everyone in the room raised their hand. If the demand is that high, what are the factors that drive 3D printing into the homes of more and more people?
Today demand is outpacing supply, judging from the long delays in fulfillment on 3D printer sites. However, it’s not just that we need more 3D printers to sell. Makers of 3D printers will have to differentiate themselves in three different ways:
Undoubtedly, 3D printers will get cheaper and more functional. The cost will drop with volume, as well as more efficient manufacturing processes. Many of the Kickstarter-fueled 3D printer projects have set artificially low prices, based more on the cost of materials and a huge discount on real labor rates. It will be a challenge for many of them to scale to greater volumes. At the same time, does a 3D printer become a commodity, such as a PC, where its basic design, assembly, and operation are essentially the same?
The level of usability, as we found in our 3D printer tests last Fall, varies quite a bit. Usability starts with the out-of-the-box experience and continues through setup and testing, and the ease with which you can connect the printer and the kinds of software interfaces that allow you to create an object and send it to the device. The more open the 3D printer, the less control its makers have over the user experience and the tradeoff is ease of use.
Reliability is another factor. If you’re going to put 3D printers in offices, makerspaces, and schools, mulitple users with different levels of experience and patience will be controlling them. Is the personal 3D printer able to withstand the pounding? Or will each printer require an “admin” to keep it up and running and performing calibrations on a regular schedule? If so, the cost of the machine will be only a small part of its cost-of-ownership. Certainly, higher-priced industrial 3D printers may be more reliable, but they are also expensive to own and operate.
So, how many people own a 3D printer today? My own guess is under a 100K personal 3D printers have been sold. If that estimate doubles each year, it takes five years to get to a million. If it triples each year we get to a million in two and a half years.
What will motivate a million people to buy a 3D printer? Will the utility of it persuade buyers to consider it as another household appliance? Will it be seen as common household tool, like a Dremel? Or will it be considered a form of entertainment, like a game console or media player? Will it be considered a specialized piece of equipment for recreational hobbyists, like rocketry or boats?
How does one million sold compare to other household machines?
Coffee makers. How many espresso machines are sold? According to information from EnergyStar on coffee makers (PDF), retail sales of espresso machines in US were 1.4 million units in 2010. That amounts to only 6% of the total market for coffee makers. In my parent’s generation, Mr. Coffee was standard issue, a type of automatic drip machine that still accounts for 75% of the market, while single-serving machines such as Keurig are now at 19%. From the same EnergyStar report: the estimated U.S. household penetration of espresso makers was about 16% in 2009.
Toaster Ovens. There were 10.1M toaster ovens sold in the US in 2010, according to the EnergyStar report on Toaster Ovens (PDF).
Treadmills. How about home health equipment? Based on data from the Sporting Goods Manufacturing Association, Treadmill-World states that “roughly 50 million (treadmills were) sold in 2010, about twice the number of elliptical trainers.”
Printers. From 2010 to 2011, “total sales (of inkjet printers) fell from 13.1 million to 11.56 million units, according to a ComputerWorld article on a dying market for computer printers, citing that young people are less likely to see a need for printing anything.
My own hunch is 3D printers will be seen more as toys than tools. A 3D printer is fun to play with. I suspect that such printers will continue to be more cool than useful, more playful than practical, for the foreseeable future. Like tape recorders when I grew up, there’s something fascinating in creating something on a 3D printer. People spend a lot of money on boats, RVs, ATVs, and other things that are not particularly useful or practical. Not everyone has one of those, but more people seem to afford them than I would think.
We could compare computer printers to drip-coffee makers, both of which are largely sold on price. 3D printers are more like espresso machines, which are 5 to 10 times more expensive than the other choices. People who buy espresso machines are not considering drip-coffee makers. They’re not thinking price, unless they’re thinking about what they spend at Starbucks. If you’re a 3D printer maker, you’d like to see the kind of adoption of the single-serving machines that also sell the packaged coffees. You’re hoping that you can sell lots of machines fairly cheap and resupply them with filament.
So, here’s where I end up. 3D printers will be seen as a lifestyle product, something you enjoy like a jetski or an espresso machine. What do you think? I might be conservative in my thinking, so how soon do you think we’ll get to one million printers and what will drive those sales?
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