CE Retailers Set To Grow Sales As OZ Economy Picks Up
Later today Scott Morrison will tell the Melbourne Institute/The Australian Economic and Social Outlook Conference that the turnaround in economic momentum is evident in published financial data and in the increasing optimism about the outlook from the Reserve Bank and the International Monetary Fund.
“This is not some pipe dream or mirage on the horizon, but an emerging picture that can give us confidence,” he says.
An advance copy of Mr Morrison’s speech says the last two sets of quarterly national accounts show that a three-year decline in company profits has been reversed, while business surveys show trading conditions are at their best since before the global financial crisis.
“There is clear momentum starting to build again within our economy; a sign that confidence is rising within boardrooms, on shop floors and around kitchen tables across the country,” he says.
It’s also been revealed that consumer enthusiasm for technology is exceeding expectations and will drive the CE industry to an estimated 3.2 percent growth this year. Some organisations are tipping higher growth with several leading brands set to launch new products, they include Apple with a new iPhone and Samsung with the Note 8.
Among the categories that are set to grow are networked audio, smartphones and demand for 4K UHD TV’s.
Drones, OLED TV’s and virtual-reality technology are expected to each cross-revenue milestone for the first time during the next 12 months.
Overnight Gary Shapiro, CTA president and CEO said, “Not only are breakthrough technologies changing our lives for the better — such as drones delivering medical supplies to remote areas or the use of VR in patient care — tech is also a key driver of the U.S. economy- outpacing GDP growth”
Among CTA’s key findings:
*Sales of smart-home devices will rise 50 percent year over year.
*The total wearables market — which includes fitness activity trackers, other health and fitness devices, hearables, over-the-counter hearing devices and smartwatches — is expected to rise 9 percent.
*4K UHD TVs, which CTA called one of the industry’s fastest-growing segments, are tipped to grow 45 percent and 59 percent, respectively.
*Voice-controlled digital assistants, such as the Amazon Echo, Google Home and Apple HomePod, are expected to generate growth of 22 percent and 53 percent, respectively.
*Continued interest in mobile headsets and entertainment content will drive shipments of VR headsets up to 5.3 million units a 43 percent increase.
*Drone sales are expected to be up 44 percent.
“More and more consumers are adopting connected products at a rapid pace, with several categories such as drones, VR and OLED TVs surpassing significant revenue milestones just a few years since their market entry,” said Steve Koenig, CTA’s market research senior director. “At the same time, core categories, such as smartphones and note, continue to experience unit and revenue growth but not necessarily unit growth, demonstrating resilience in mature technologies. We believe the anytime/anywhere access to information and each other that connectivity enables is a driving trend of our time.”
As for maturing technology, the top five revenue categories continue to contribute just over half of total industry revenue (53 percent) in 2017. Despite some slight revenue declines, unit shipment increases demonstrate continued resilience in these categories, said CTA.
Among the findings for maturing tech:
*Smartphone unit volume will grow 3 percent in 2017, this is down significantly on prior years.
*LCD TVs will initiate a period of slight declines in 2017 with the category set to fall 1 percent. Future category growth will be driven by 4K UHD, high dynamic range and OLED display technology, said CTA.
*Tablet sales will also decline in 2017 despite brands such as Samsung launching new Tab 3 models.
*Note sales, will grow 2 percent, however, revenues will decline by 1 percent CTA said.
Morrison will tell his Melbourne audience that “There is clear momentum starting to build again within our economy; a sign that confidence is rising within boardrooms, on shop floors and around kitchen tables across the country,” he says.
Morrison expects growing confidence in the economy will result in higher business investment and says it is already generating greater hiring. “Job ads now stand at 175,000, the highest level in six years.”
He says the Reserve Bank shares his view that the economy is picking up pace, noting that it used the word “positive” eight times in the minutes of its July board meeting, which were released on Tuesday.