Last year’s Elephant in the Living Room report highlighted the rise of appliances and gadgetry – and their looming threat to carbon reduction targets. In a slightly different approach to our usual blogging, we asked Nigel Catlow from market researchers GfK to review last’s year’s consumer electronics trends, as well as this year’s January sales. Here’s what he had to say…
2011 was an immensely difficult year across many technology markets and Christmas/early January trading was no different. One of the biggest issues for manufacturers and retailers has been the declining value brought on by a combination of falling volume but also falling prices in digital devices.
Retail value for the year fell around 4 per cent across electricals (excluding mobile phones) despite a positive retail value injection of 2.5 per cent because of January 2011’s VAT Increase. December and January sales did not alter these trends.
In Photo, market volumes fell across the year by around half a million. This trend accelerated across the Christmas period. These losses came in the low end “point and shoot” sector of the market as Smart Phones became the device dominating the pocket in more ways than one. The Smart Phones’ ability to play music and take pictures impacted volumes severely in cameras and even moreso in MP3 players.
In spite of this, the camera market is still substantial and sales of more sophisticated products with Superzoom or changeable lens capability are growing.
Phone sales in total also fell, but still made in excess of 27 million in total in 2011. For the first time, Smart Phone sales exceeded standard mobile phone sales within this. Their higher value may ensure they are better looked after and therefore changed less frequently by consumers than their mobile phone predecessors. As a consequence of the rise of the all-in-one device, headphone sales have rocketed and now exceed 10 million per year and MP3 player sales are falling at around 30 per cent year on year.
Other more traditional consumer electronics categories also suffered. The main issue here is that our existing ownership levels of audio systems, flat TVs and the like is high.
In a period of low confidence, we spend less on upgrading existing devices unless there is a substantial reason for change. Hence volumes dropped substantially in these markets. However, where there is innovation, and more specifically, visible innovation, consumers are spending. This is why the very largest TVs (43”+) continue to grow in volume as consumers now see they can afford a “Jumbo” sized screen which is a substantial improvement on what they already possess.
The ownership of the newer TV technologies such as connected TV, LED, and 3D is on the up as these larger sets often carry these features as standard. These “Jumbo” TVs are most likely going into homes where there is already a Flat TV model, this would probably then migrate from the main room to another room, potentially increasing multiple TV ownership.
However, where these models replace an existing Flat TV or CRT it is possible that energy consumption is reduced by the greater efficiency of the LED technology. The slim and large screen nature of these sets will probably have other consequences in that they seem more likely to be hung on the wall and more likely to require enhanced sound. So the small “sound bar” market is showing big growth.
IT is following a similar pattern: flat sales volume in high ownership categories such as laptops but rapid growth in E-readers, Tablets or Web Books and in portable Hard Drive Storage. All these are relatively new and are expanding our ownership of portable connected devices. They were the key winners and stars of technology at Christmas 2011 and seem likely to change some key elements of consumer behaviour as ownership rises.
Obviously all of this has an impact on home energy consumption, but from a solely energy perspective, most positive progress is being made in the arena of white goods, where the proportion of “A” rated appliances continues to rise.
Especially successful here have been the high capacity washers and tumble dryers which are an increasing part of their respective markets. These tend to bring lower water usage and more efficient electricity usage.
Talking television, the advance of LED TVs is helping to reduce electricity usage per hour in key screen sizes. LED accounted for less than a tenth of TV volume in 2010 but will rise to 40 per cent at least across 2012. The environmental impact of this is mixed, though, since consumers tend to upgrade in screen size with the more efficient technology.
At least the full impact of the bigger screen size trend is being substantially reduced. What this means for energy use in IT is more difficult to discern, whilst some of the newer mobile devices are potentially more efficient, the purchase of a Tablet doesn’t necessarily imply that a lap top will be used less. This could be the case but also the different devices are likely to be still both used in different places. Further investigation will be required to understand this impact.