GfK findings on the global consumer electronics market – first six months of 2015
Nuremberg, September 2, 2015 – Because the market for consumer electronics is still in upheaval due to consumers’ changing listening and viewing habits, sales value rose in the first six months of 2015. Innovative solutions, such as Ultra HD technology, sound bars or multi-room systems are the primary drivers of growth potential in the TV and audio segment. Positive momentum for the entire TV market is visible in all regions of the world except for Europe. These are GfK's findings on the global consumer electronics market, published to coincide with the IFA 2015 trade fair in Berlin.
GfK expects a sales value of €185 billion globally for the total consumer electronics market in 2015. That is approximately €9 billion more than in the previous year.
TV market: Ultra HD is the growth segment
The worldwide TV market is in a consolidation phase in 2015. In 2014, 234 million LCD TVs were sold; without a major event such as the FIFA World Cup this year, there will be approximately 4 million fewer sold. This represents a decrease of nearly 2 percent. However, the individual regions are developing differently. The strongest growth relates to the Middle East and Africa with 5 percent. But also in Asia as well as North and South America, positive impulses for the total TV market are visible. In 2015, a total of 35.3 million LCD TV sales are expected in Western Europe. That is approximately 6 percent less than in 2014. There is a significant sharp decline in the Eastern European market including Russia and Ukraine. It is expected that sales in this region will decline by 7 million LCD TV sets.
In contrast, the Ultra HD TV segment is developing positively in all regions. Ultra HD makes it possible to display a razor sharp picture on an even larger diagonal screen size because it has a four times higher resolution than the previous full HD TV. Over 28 million Ultra HD TVs are expected to be sold in 2015, the largest portion of which will most likely be in China. 40 percent of households there already have such a TV. In Western Europe, GfK expects sales volume of nearly 4 million units. More than one in every ten TVs sold in Western Europe will be an Ultra HD set. In terms of value, Ultra HD is even more significant. Already 10 percent of all TVs sold in Germany in June 2015 were Ultra HD TVs, and these were responsible for a quarter of TV sales value.
In addition to Ultra HD, there are other developments that make purchasing a new TV interesting. The size of the screen continues to be a true selling point. In 2010 in Europe, the average size of a new TV was 31 inches (79 cm) and in 2015 it is 38 inches (97 cm). But at the same time, the average price dropped. Therefore, the consumer gets more for less money. Purchase incentives include further enhanced picture quality, OLED TVs, curved units, open operating systems such as Android, Tizen, Firefox OS or Web OS and other technological developments that enable even more consumer entertainment.
And everyone is still talking about smart TVs. Particularly the combination with video on demand gives consumers access to non-linear television. This allows the viewer to retrieve internet content at any time. Every second new TV sold in Europe is a smart TV. In total, these units account for nearly three quarters of its sales value.
However, with the increasing availability of video on demand portals on smart TVs, game consoles, or media players, the optical drive becomes increasingly unnecessary. Accordingly, GfK predicts that worldwide only 57 million DVD and Blu-ray players/recorders will be sold this year. This represents a decline of almost 10 percent compared to 2014.
Sound bars and sound bases provide a cinema atmosphere at home
Regardless of whether they are placed under or in front of the television, sound bars currently provide an increasingly better sound experience and therefore a cinema atmosphere in the living room. Worldwide 11.5 million sound bars were sold in 2014. That was 64 percent more than in the previous year. The demand should rise again significantly in 2015. GfK expects global sales volume of 14.3 million units, which would represent an increase in sales value of 21 percent compared to the previous year. In particular, the regions of Latin America and Central and Eastern Europe are among the winners this year. But also in Western Europe, the demand for the popular alternative to the traditional home theater solution is expected to remain unrestrained.
In the first six months of 2015, the demand for sound bars in Western Europe clearly grew and recorded a sales growth of 29 percent with more than 1.3 million units sold. In particular, sound bar systems with an external subwoofer still enjoyed great popularity and were responsible for nearly 60 percent of sales value in the sound bar segment in the first six months of the year. With this segment a Bluetooth connection is instrumental in the purchase decision, as it is in the entire audio segment. If your own music collection is stored in MP3 format on a smartphone or tablet or if you’re using one of the increasingly popular online music streaming services, it is important that the transmission to the sound system should be carried out as quickly and simply as possible. In the course of the period from January to June 2015 already, nearly 80 percent of all sound bars sold had a Bluetooth function.
Home theater systems suffer due to the success of sound bars and sound bases
Due to the success of sound bars and sound bases, the demand for typical home theater systems with integrated DVD or Blu-ray players worldwide shrunk last year by approximately 23 percent to only 8.4 million units. For the current year, GfK expects a further decline of 13 percent to 7.3 million units. However, this highly negative trend mainly affects mature markets such as Western Europe or the developed regions of Asia. In Eastern Europe and Africa (sub-Saharan Africa), the market has a less steep decline, minus11 percent and minus 9 percent. So far, sound bars only play a minor role in these markets. The prospect of the Ultra HD successor to Blu-ray discs gives reason to hope. Potentially it might be introduced by the holiday shopping season creating demand for new playback devices. The first products are expected to be launched simultaneously with the IFA.
Sales volume of AV receivers drops significantly
Because GfK has primarily monitored this category in the Western European markets, detailed statements can be made regarding this region only.
After a slight decline in sales last year from 790,000 to 727,000 units, this trend continued in the first six months of 2015 (18 percent decrease). A possible cause might be the trend towards active TV speakers. However, from a technical standpoint in the recent past, there was little pressure on the receiver enthusiast to change hardware. Many devices from the 2014 collection lacked full support for the new Ultra HD standards (HDMI 2.0 and HDCP 2.2). This should no longer be an issue with the new models at the IFA. This could stimulate some demand for the holiday shopping season.
Music systems and hi-fi
Last year, sales value for music systems and hi-fi decreased by approximately 4 percent. GfK expects a significant stabilization this year. According to the forecast, approximately 18.6 million units should be sold. Sales value is expected to rise by approximately 6 percent, although the still highly sought-after Bluetooth speaker could cannibalize the market. Even music systems are becoming increasingly “smarter”, more linked and thus a bit more expensive on average. The so-called multi-room systems are popular particularly in Northern and Central Europe (sales value increased by 42 percent in the first six months 2015). On the other hand, in Southern and Eastern Europe the classic stereo continues to dominate. But even this device has Bluetooth connection thanks to the smartphone era.
In the emerging markets, especially South America, the audio buyers are particularly focused on power. Systems with 1,000 plus watts make up about 40 percent of sales value.
In general, the current situation in the states of the former Soviet Union is very difficult. The market has suffered a massive collapse due to the conflict between Russia and Ukraine, as well as the related trade embargo.
About the methods
As part of a retail panel, GfK collects data on a regular basis in more than 100 countries around the world about TV and video devices, portable audio products, hi-fi and home cinema systems.
For more information:
Jürgen Boyny, +49 911 395 2325
GfK activities at the IFA 2015:
1) The GfK info point at the IFA press center will provide all information to be published by GfK during the IFA
2) Our experts can be found in the GfK office at the IFA (VIP room 2, Großer Stern) for face-to-face conversations. View GfK’s precise location on the exhibition map at: www.gfk.com/documents/ifa-map-2015.jpg
3) The GfK conference “Beyond smart – relevance is key” takes place on 3 September, at 1 pm (3 pm finish) at the IFA, Marshall Haus Messegelände Berlin. The itinerary for this event can be downloaded at: www.gfk.com/news-and-events/events-webinars/pages/ifa-2015.aspx
4) GfK presentation at the “The Opening Ceremony of China Brand Show” hosted by China Chamber of Commerce for Machinery and Electronic Products Import and Export (CCCME) on 4 September, at 12 noon (2pm finish), Hall 29, IFA Messe Berlin. GfK speaker: Juergen Boyny, Global Director Consumer Electronics, Topics: “Chinese continuous growth in Global Markets of Digital World and Home Appliances.”
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