Appliances Rule, TV’s Drool
Australian tech market slumped last year but appliances, iPhones, Androids and headphones like Beats pump up the volume as TV’s continue to struggle.
However, consumer tech actually stabilised last year following a sharp decline of 6.2% in 2012, according to GFK Temax, attributed to the final digital switch-over and a surge in tablets like iPad and Samsung Galaxy Note.
In 2013, technology sales fell 2.3% to $17.6 billion, and demand slowed again in Q4 (Oct-Dec) – down 3.2% compared to Q4 12.
However small appliances like vacuum cleaners, food preparation and juicers defied the trend in Q4, and grew 3.6% in sales. Appliances are a high margin, hot category, with JB Hi-Fi converting several consumer tech stores into the ‘Home’ appliances locations.
Robot vacuums, proved a popular Christmas gift among Australians, and hand stick vacuums also surged.
Food preparation gear like juicers and blenders have seen a further rise in average price, and “the mix of sales has
shifted to the higher end,” said GFK.
However, big appliances like fridges were “badly hit” in Q4. The sector fell 1.8%, marking the first quarter of sales decline in 2013.However, average prices of appliances continued to climb, as consumers continued to trade-up to higher-end ‘smart’ products.
Telecommunications still accounts for the largest sector in the tech industry, but mobile phone sales softened during the Christmas quarter, with lack of availability of key models a major contributing factor.
There was a “dramatic shift” in the type of smartphones purchased: outright phones experienced strong growth, and was one of the most significant retail sales trends in 2013, according to GFK.
In the IT sector, tablets like iPad and Samsung Galaxy Note 10.1 was one of the biggest drivers of Christmas sales in Australia.
However, growth ‘phablets’ like the Samsung Note 3 and HTC Max in Q4 saw a shift in industry focus, as consumers continued to move to smaller, lower-spec models – expected to be a key growth segment in 2014.
In Q4, tablets costing $100 accounted for 20% of sales, compared with only 5% in quarter 4, 2012.
Notebook demand was helped by the popularity of higher-priced, thin and light-weight models; and higher spec, computing tablets.
Switch-over fails to switch on
TVs continue to struggle although demand was boosted slightly by the final digital switch-overs in Melbourne and Sydney, in December.
32″ TVs accounted for almost a third of all TVs sold in Q4.
4K/Ultra High Definition TVs continued to grow, helped by an increasing range of models and price drop.
Headphones like Beats and Sennheiser has a booming Christmas on double-digit growth, aided by a strong performance of mobile devices, gifting and significant promotions, GFK said.
|Diverse and fashion-orientated over-ear headphones continued to drive the increased demand in a category that now commands a higher retail value than audio systems and DVD/Blu-ray video player.
But GFK analysts predict challenging conditions in tech market will to continue in 2014.
“In 2014, whilst we are expecting to see many pockets of innovation and opportunity, it’s unlikely that any one sector will drive the market into a new phase of growth.
“The stabilization of the Consumer Electronics and IT sectors is likely to continue, but with the combination of the maturity of the Telecoms sector, and worsening macro-economic conditions, another challenging year lies ahead.”