For Department stores sales, the trend estimate fell by 0.2 per cent for August
and the seasonally adjusted estimate fell by 2.9 per cent.
The trend estimate for Household goods retailing overall was relatively unchanged
at 0.0 per cent, but the seasonally adjusted estimate fell by 0.8 per cent.
The industry subgroup faring the best is the Hardware, building and garden supplies
retailing with a rise of 0.3 per cent, followed by Furniture, floor coverings,
houseware and textile goods retailing with a rise of 0.1 per cent.
GfK Technical Consumer Goods Market Findings
Backing up these ABS figures, the results from GfK’s TEMAX Index for the second
quarter of 2014 showed the Australian Technical Consumer Goods (TCG) market
recorded a revenue decline of -3.2 per cent.
According to GfK, the growth in the Information Technology (IT) sector was not
sufficient to balance the decline of Telecoms, Consumer Electronics and Small
Appliances.
As GfK found, although the Australian TCG market was in overall decline, there
were pockets of solid growth. IT continued its recent positive trend, led by a
recovery in mobile computing and wireless connec-tivity devices, while Major
Domestic Appliances (MDA) stabilised after a couple of consecutive periods of
value decline.
The IT sector grew in the second quarter of this year, showing a 2 per cent value
growth compared to the same period last year. The majority of segments within IT
showed strong signs of recovery with most recording value growth.
After a long period of value decline, mobile computing, the largest category
within IT, was flat year-on-year. With sales of mobile computing playing an
important role in the sales of computer peripherals, this recovery is likely to
have a positive impact on the IT sector as a whole.
One key IT segment to show growth in the second quarter was wireless range
extenders. Typically used to boost Wi-Fi signal at home, strong sales of these
products indicate an increasing usage and focus on Wi-Fi within Australian homes.
Major Domestic Appliances
After two consecutive periods of value decline, the Major Domestic Appliances
(MDA) sector stabilised in the latest quarter. Higher-priced, feature-rich
products added value to the MDA sector, with value growth surpassing volume
growth during the quarter.
Within the dryers market, heat pumps and condenser heating models were catalysts
for growth. With an average price four times that of standard dryers, the demand
for heat pump dryers had a positive impact overall.
Another area of note within MDA was the rangehoods segment. Canopy/cartridge
rangehoods grew significantly in the second quarter of 2014, accounting for
nearly a fifth of the spend on this segment.
Telecommunications Challenge
The second quarter of this year was challenging for the Telecoms sector, with
smartphones recording their second ever value decline.
The trend towards outright purchases continued in the second quarter. In fact,
for the first time ever, the sales for smartphones purchased outright, or without
any carrier attachment, outsold those purchased on prepay.
Bigger screens also continued to gain popularity. Focusing specifically on new
smartphones launched in this quarter, nearly 90 per cent of sales were generated
from models with a screen size of 5″ or larger.
Consumer Electronics: Large Screen Demand Continues
The value of the TV market continued its recovery in the second quarter. A slew
of new ranges were released which were heavily focused on super-large screens,
with a wide range of UHD/4K models (and a few curved) seeing strong initial
sales. This continued shift towards premium TVs fuelled an overall average price
increase. The average price for TVs reached its highest quarterly figure since
the third quarter in 2010.
Interestingly, the impact of the FIFA World Cup – usually an event that generates
a spike in large-screen TV sales – was minimal this year. The significant time
difference between Australia and Brazil may have been a factor, but according to
GfK, the general dominance of large-screen TV sales in the past year or two would
also impact on the ability of the industry to generate incremental sales.
One of the stronger performing segments in recent times has been head-phones.
This segment has experienced a significant slow-down in growth in the second
quarter of this year, partly due to the plateauing of attachment categories such
as smartphones and tablets. A year-on-year decline in the number of models
available for sale, after several quarters of strong growth, provides further
evidence of a maturing category.
Small Domestic Appliances (SDA)
According to GfK, a relatively mild start to the winter affected the heating-
related categories within SDA, as both electrical and gas heaters, as well as
electric blankets, all showed a decline on last year. Vacuum cleaners, the
largest category within SDA, did continue to grow, with the higher priced hand-
stick and robot sub-segments still driving overall vacuum market growth. Between
them, these segments now account for over a third of the vacuum cleaner market.
Products promoting health are also continuing to drive the SDA sector. These
include low-oil fryers and slow juicers, suggesting that consumers are willing to
pay more than twice the price for kitchen appliances with health benefits.
Market Likely To Remain Flat At Best
GfK found the market for 2014 has already seen periods of recovery for the IT and
Consumer Electronics sectors, but any pockets of opportunity have been
overshadowed by decline elsewhere.
The performance of the Telecoms sector will play a large part in the overall
health of the TCG market in the final quarters of the year. Expectations of a
flat Telecoms sector will probably mean a flat performance for the TCG market as
a whole.
All reports from GfK are available at www.gfktemax.com
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