EXCLUSIVE: Consumer Electronics spending in Australia declined by 5.2 per cent in the last quarter according to new GFK data despite two consecutive months of interest rate holds.
The German research company, who recently lost access to most JB Hi Fi data, and are now facing being banned by another national retailer, said that a fall in consumer confidence, the absence of government stimuli and an uninspiring federal budget has contributed to this quarter’s decline in technical consumer goods spending.
The biggest hit was felt by appliance retailers while demand for Smartphone’s beat the downward trend.
GFK said that while the value of traditional mobile phones fell 52 per cent from Q2 2009, sales of Smartphone’s more than compensated for the loss, with an increase of 92 per cent. The revenue generated by Smartphones in this quarter was almost three times greater than that of standard mobile phones GFK Analysts said.
Also coming under pressure was the ITV sector which for the first time in five years, failed to achieve value growth. The market declined 1 per cent in quarter 2, 2010, compared to the same period last year.
GFK said that this year’s decline in value was exacerbated by strong price erosion in the dominant notebook PC market, which experienced its first ever value decline (-3 per cent) in the history of the category.
Despite the performance of the IT sector several categories performed strongly in both units and value despite categories like storage witnessing an average price decline of 25 per cent.
This category grew by 23 per cent in value and 62 per cent in units said GFK.
Despite the FIFA Soccer World Cup, the launch of 3D TV technology and the launch of a major 3D TV marketing campaign by Harvey Norman, consumer electronics sales fell 8.3 per cent in the quarter despite a relatively strong performance from the large flat panel TV market.
Audio systems, camcorders, car navigation, MP3s and set-top boxes all experienced double-digit decline, replicating the trends of the IT sector.
GFK claimed that consumer electronics suffered from the combination of a lack of government stimulus, and continuing average price declines.
Due largely to the additional demand created by the World Cup, the value of the flat panel TV market remained steady, although the unit growth of 40 per cent illustrates the extent of the price erosion that took place during this period. The World Cup sparked another round of high-value give-aways by major manufacturers. Some of these were linked to a purchase of a 3D TV, although the availability of 3D was fairly limited on the run-up to the World Cup.