Making Sense of Drone Market Forecasts: 2016 and Beyond

1|Copyright ©2016 Skylogic Research, LLC
MAKING SENSE OF
DRONE MARKET
FORECASTS: 2016
AND BEYOND
Colin Snow
For Small
Unmanned Systems
Business Expo
April 27, 2016

“It’s tough to make predictions, especially about the future.”
– attributed to Yogi Berra

Forecasts: diversity,
hype, rumor, and
wonk
$2B - $92B

Diversity
We are currently tracking
31 different forecasts!
Most reports sell between
$2,000 and $6,000

Hype
“Precision agriculture and
public safety will make up
more than 90% of the
market growth for
unmanned aerial systems.”
The report confidently
states, “…the commercial
agriculture market is by far
the largest segment,
dwarfing all others.”

Rumor Q. What was the impact of FAA’s consumer drone
registration on holiday sales?
A. NPD says some slippage at first, but in the end
sales were up YoY

Wonk “In the period from August 2015 to December 2015, only
37.8 percent of exemptions listed a single intended
operation, compared to 57.3 percent in the period from
September 2014 to July 2015.”
Source: “Analysis of U.S. Drone Exemptions2014-2015.” Center for the Study of the Drone at Bard College. March 16, 2016.

Wonk Because of 3rd party “copy-and-paste” FAA Section 333
applications (over 1,100 by one firm alone) the data is
now an unreliable source of actual UAS commercial
operations activity or actual UAS commercial aircraft in
use.
The
“Howdy Doody”
Effect

Wonk “On average, exemptions list two unmanned aircraft
types that will be used in operations. The most popular
unmanned aircraft maker is DJI, which accounts for two
out of three drones listed across all exemptions.”
The
“Howdy Doody”
Effect
Many – including DJI –
believe this affirms their
“70% market share”
claim.
But this is not unit market
share. It is only what is
listed on the application
as what they “might use”
- not what they actually
own or even will use.
Source: Bard
Image: DJI

Wonk Q. Which is the best predictor of commercial use?
A. Neither!
Source: Bard

Our latest research
Large sample size means the
statistics are very reliable
Confidence level: 95%
Valid for a population of 5
million buyers
783qualifiedrespondents

Sample data

Buyers Q. What is the age of drone buyers?
0.1%
9.3%
45.6% 45.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
15 or under 16 - 31
(Millenials)
32 - 51 (Gen X) 52 + (Baby
Boomers)
n = 783
Source: Skylogic Research
YES

Price points Q. What was the price of your last drone purchase?
17%
13%
34%
18%
9%
7%
2%
1%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Less than $500
$500 - $999
$1,000 - $1,999
$2,000 - $3,999
$4,000 - $7,499
$7,500 - $34,999
$35,000 - $99,999
More than $100,000
n = 650
More than half of all
buyers purchase drones
costing between $1,000
and $4,000
insight
SEVEN

Most popular brands Q. What was the brand of your last drone purchase?
50%
7%
4%
3%
3%
2%
2%
2%
2%
4%
20%
DJI
3D Robotics
Yuneec
Blade
Parrot
Event 38
Hubsan
FreeFly Systems
Syma
Custom
Others (<2%)
n = 647
DJI’s overall market
share in North America is
about 50 percent—not 70
percent as popularly
described.So there is a
substantial population
willing to buy other
brands at various price
points.
insight
SEVEN

Commercial UAS
aircraft (N-number)
1805
197
134 127
0
200
400
600
800
1000
1200
1400
1600
1800
2000
DJI 3DRobotics Precisionhawk AscTech
DJI = 46.3% Overall
As of 3/31/2016 - Source: sUAS News
See more here:

Intended use for
drones costing over
$2,000
FAA Definition of UAS
Operations
1. Public
Includes public entities such as
federal and local governments,
police departments,
universities, etc.
2. Civil
Includes commercial and
private industry operators
3. Recreation / Sport
Any person operating a ‘model-
aircraft’ UAS for recreation or
sport or hobby falls into this
category
75%
15%
10%
Civil / Commercial
Recreational / Hobby
Public / Governmental
n = 235
Most drones (85%)
costing more than
$2,000 are purchased
for professional use.
Key insight
FOUR

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37pages
20figures
9datatables

About Skylogic Research, LLC is a research, content, and
advisory services firm supporting all participants in
the commercial unmanned aircraft systems (UAS)
industry.
We provide research-based insights needed to make critical investment
decisions with confidence.
Our focus is on the needs of three constituents:
• Manufacturers, suppliers, and business service providers – who
need research and insight into buyer needs
• Buyers of UAS technology and services – to help inform their
acquisition decisions
• Investors – who need to distinguish technical and market viability
This focus, plus research as a foundation and reach into a community of
more than 80,000 business executives and innovators through social
media and media partnerships, allows Drone Analyst to deliver a high-
value, low-risk method for achieving optimal understanding.
Drone Analyst is the brand name and trademark of Skylogic Research,
LLC
Learn more:
Web http://droneanalyst.com
Twitter @droneanalyst
Email colin@droneanalyst.com

©2016SkylogicResearch,LLC.
Allrightsreserved.
This publication is approved for public release and distribution under the terms of
the Small Unmanned Systems Business Expo.
Drone Analyst products and services mentioned herein as well as their respective
logos are trademarks of Skylogic Research, LLC.
These materials are provided by Skylogic Research are for informational
purposes only, without representation or warranty of any kind, and Skylogic
Research shall not be liable for errors or omissions with respect to the materials.
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