Positive developments in the areas of information technology, small and major domestic appliances, photo and the office market are providing a broad basis for growth. However, sales in the consumer electronics and telecommunications segments were not able to maintain their level in terms of value.
With a year-on-year increase of 6%, GfK TEMAX Germany is continuing the growth recorded in 2010 and the market for technical consumer goods remains in good shape.
Information technology achieved the best results in 2010 and has retained its leading position in the first quarter of 2011. In the photographic segment, which was still showing a loss in the fourth quarter of 2010, there has been a trend reversal and positive growth rates were recorded once again at the beginning of this year. However, the exact opposite is occurring on the telecommunications market. The growth seen at the end of 2010 has been followed by a weaker start to this year and a decline in overall sales. There was also a year-on-year drop in sales of consumer electronics in the first quarter of 2011. In contrast, small and major domestic appliances and office equipment and consumables were able to consolidate the positive growth recently recorded.
Impressive sales growth of 16.8% in the information technology segment has resulted in a total market volume of EUR 4.5 billion. In the first quarter of 2011, sales of the following product groups were included in GfK TEMAX Germany for the first time: keying devices, multi-disc drives, pointing devices, visual cams, webbooks, communication devices and HDD-drives. Figures from the previous year have been adjusted accordingly for the purposes of comparison. The last two product groups alone were responsible for around a quarter of all sales in the IT segment in the first quarter. Although webbooks (e.g. iPads and Co.) initially only recorded a comparatively modest single-digit share of overall sales, their current growth rates are outstripping all other product groups. At present, the IT market is beginning to see a shift towards innovative products.
Notebooks remain the most important source of revenue; compared with the first quarter of 2010, they again recorded double-digit growth in terms of sales value. The continuing trend towards mobility is also reflected in the success of new products such as e-readers, mobile internet devices and tablet PCs. In the IT components segment, data communications devices and the storage market (above all internal and external hard drives) are making a particularly strong contribution to the overall positive development.
Despite the somewhat uncertain global environment and the recent slight dampening of consumer sentiment in Germany, sales in the information technology market remained at a high level in the first quarter of 2011. Since the number of IT products per household is increasing significantly, GfK Retail and Technology expects further growth for this segment. Traditional desktop computers, notebooks with large screens for use at home, small-sized notebooks and netbooks for on the move, and tablet PCs are just a few examples of the wide variety of devices available today that allow digital content to be experienced and created.
Having recorded only moderate growth recently, the market for major domestic appliances has had a successful start to 2011, with a year-on-year increase of 6.4%. This is the third strongest sector (in terms of sales) monitored by GfK TEMAX® Germany (see table on page 6), recording revenue of around EUR 1.9 billion in the first three months of the year. With the exception of freezers, where sales continue to be under pressure, all product groups are contributing to this growth. Cooker hoods in particular are driving the positive development, as they are profiting from the continuing trend in favour of high quality and design-oriented kitchen equipment.
There is once again a markedly positive overall trend for major domestic appliances, not least because of the ongoing demand for particularly energy-efficient products. GfK Retail and Technology believes that, in addition to energy efficiency, functionality and design will also be growth drivers for major domestic appliances in future.
The market for small domestic appliances continues to record solid growth; compared with the first three months of 2010, sales in the current year are up by 6%. Personal care products and kitchen appliances are providing the strongest stimulus, with food processors and stand mixers showing particularly positive development. The latter are benefiting from the increasing demand for high-quality products. For hot beverage makers, which are the most important segment in terms of sales value, a divided picture emerges. While espresso capsule systems are making a significant contribution to growth and fully automatic machines are maintaining stable sales figures, sales of traditional filter coffee machines are declining. In the personal care category, the main positive stimulus is provided by dental products, and primarily by high quality electric toothbrushes. Conversely, there is a slightly negative trend in the important cylinder vacuum cleaner segment- sales are declining in the lower price categories in particular. This is partially offset by increased demand for robot, general and hand-held vacuum cleaners, whose growth is primarily attributable to new products and competitors, as well as to the positive development in the segment of high-quality battery-powered devices.
The huge variety of products and suppliers has compensated for declines in some areas. It is evident in numerous product groups that although many consumers are not necessarily making purchases more often, the amount they are spending on new acquisitions is increasing. High-grade equipment and the quality of the models are often key factors in consumers' purchase decisions.
The ongoing interest of German consumers in photographic products is reflected in a sales increase of 4.2% compared with the same quarter of the previous year. Digital cameras, and of course the corresponding accessories, continue to be popular with consumers. Demand for high-priced quality products, such as lenses, is particularly high; these recorded double-digit growth in comparison with the same period last year. Flash guns are also benefiting from this development and registered a rise in sales value. High-quality tripods were also in particular demand during the first three months of 2011, generating considerably higher sales than in the first quarter of 2010. In contrast, there continues to be a markedly negative trend for digital image frames, which showed a double-digit decline in sales. Even a reduction in the average price has so far not re-stimulated flagging consumer demand.
Overall, however, a continued positive trend is expected for the photographic market this year. Digital cameras will remain the main basis for this trend and will in turn generate demand for supporting products and accessories.
The office market is this year continuing the positive trend seen in the last quarter and recorded a year-on-year sales increase of 3.2%. This corresponds to a market volume of EUR 1.29 billion.
Data and video projectors have followed on directly from the pleasing development of the last year as a whole and, despite a slight weakening, remain on an upward growth trend. Although there is no major sporting event this year that could increase demand in this segment on a sustained basis, as the Football World Cup 2010 did, consumer demand for large screen diagonals, which can be met by full-HD compatible projectors, will continue to grow. In the market for laser printers, all core segments contributed to a positive sales boost in the first quarter. The rising sales share of colour printers particularly stands out, but the strongest growth rates continue to be recorded for multifunctional devices. The market for inkjet printers, on the other hand, is still on the decline. A large proportion of falling sales is attributable to the reduced prices in computer shops and office equipment specialists. Even though the good start to the year has not been reflected in the sales figures of all segments in March, the general sales development of the market continues to be positive.
The consumer electronics market experienced a sales decrease of 2.2% in the first quarter of 2011 in comparison with the first three months of 2010. The sustained pricing pressure in this industry is taking its toll and counteracting the positive sales development. In addition, individual product groups are increasingly saturated. This applies, for example, to LCD TVs, which are the growth drivers in the consumer electronics segment. The comparatively young product groups of portable audio and navigation devices are also coming under pressure. However, high-priced products with mobile access to information such as traffic, flight and weather data or to the Google search function are enjoying very positive growth. This shows that high-grade products and features that give the consumer visible added value remain in demand.
Sales of set-top boxes are showing negative development in comparison with the first quarter of 2010. However, the one-off effect from the introduction of high-definition TV last year, which caused above-average growth rates in the market, must be taken into account, and the decline therefore does not come as a great surprise. Meanwhile, an interesting date for manufacturers of set-top boxes is fast approaching; in April 2012, analogue satellite channels will be turned off for three million households in Germany, and it remains to be seen what effect this will have on sales.
Overall, it will be more important than ever this year to create additional purchase incentives in the area of consumer electronics. In this TV segment, which is by far the most important in terms of sales value, there are some very promising areas of potential. Despite digital convergence, the TV set is still the "media centre" in private households with continuous high usage over the years. The TV market is receiving positive stimuli from the desire for large screens, and in addition, GfK Retail and Technology believes that 3D TVs will experience a noticeable surge this year, which will also give a boost to sales of 3D Blu-ray players and 3D home theatre systems.
Despite considerable growth in the smartphones segment, the telecommunications market has recorded a drop in sales of 8.2% in the first quarter of 2011 compared with the same period in 2010. This is predominantly down to a decline in the mobile phone segment; sales have shrunk considerably from last year's levels. However, the reverse is true for smartphones, which are seeing sales growth rates in the high double digits. Thanks to good infrastructure, a large variety of flexible applications ("apps") and the increasing use of social networks while on the move, not only business clients, but more and more private users are resorting to the digital "all-rounders". Accordingly, smartphones costing less than EUR 150 (handset price without subsidy) are performing particularly well in hypermarkets. However, with three-quarters of sales, the main sales channel for this product group continues to be Telecom Specialists. Small telephone systems are also still recording positive growth rates, and products that do not have an IP connection, but which offer high-quality features, remain the growth drivers.
With an increase of 6% on the same period in the prior year, GfK TEMAX Germany is continuing the growth recorded last year. The market for technical consumer goods therefore looks in good shape, with a successful start to the New Year.
Rising prices, the Fukushima nuclear reactor disaster and political unrest in North Africa and the Middle East are currently all weighing on the general economic conditions. Although consumer sentiment has recently dampened slightly as a result, the propensity to buy has so far maintained its good level. German consumers, who have become the "optimists of Europe" in their attitudes to consumption, also continue to view the domestic economy as being on the ascent. For 2011, GfK Retail and Technology is therefore expecting an increase in the expenditure of private households, with correspondingly positive effects on GfK TEMAX® Germany.
GfK TEMAX® is an index developed by GfK Retail and Technology to track the technical consumer goods markets. The findings are based on surveys carried out on a regular basis by the retail panel of GfK Retail and Technology. The retail panel comprises data from over 370 000 retail outlets worldwide. Since February 2009, GfK Retail and Technology has also been compiling the GfK TEMAX® index at international level in more than 30 countries. It is the first index that includes all of the markets for technical consumer goods in different countries. All reports and press releases are available at www.gfktemax.com.
Source: GfK TEMAX® (www.gfktemax.com)
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