Electrolux disputes Dyson 40% market share claim

By James Wells

SYDNEY: Electrolux Australia managing director – floor care and small appliances, John Mahar, has disputed claims made by Dyson which stated the bagless company holds ‘over 40 per cent value share in the local vacuum market.

“There is no question that Dyson has been successful in Australia and like anyone they deserve to celebrate their 10 year birthday,” said Mahar in a letter to current.com.au.

However, Mahar pointed to Dyson Australia managing director, Ross Cameron’s reference to certain brands use of ‘misleading information to promote their products’ and stated “frankly, in regard to supposed market value share held, Mr Cameron should adopt his own above reference and views more closely.

“GfK, in their latest statistics (as at June 2006) stated that Dyson, on a moving annual total (MAT) basis, has in fact only 31 per cent value share of the vacuum market, and that percentage is excluding hand-held products that still are part of the vacuum market,” Mahar said.

“That’s 31 per cent at best and not ‘over 40 per cent’ as claimed in the article in question.

“It is also therefore interesting to note that on that basis, more than 7 out of every 10 dollars at retail in Australia spent on a vacuum cleaner is spent on brands other than Dyson,” said Mahar.

“In volume terms, very close to 9 out of every 10 vacuums purchased are actually brands other than Dyson. Again these figures exclude hand-helds that are part of the overall vacuum category.”

Dyson claims GfK data may be inaccurate as the research company estimates approximately 20 per cent of the market for sales through the Godfreys retail stores.

According to GfK statistics, Dyson obtained 37.2 per cent value share for the month of June 2006. Dyson estimates that without Godfreys data, its share would be well in excess of 40 per cent and even with the estimates for the Godfreys business, it could be entitled to at least another three percentage points.

"The Dyson 40 per cent share claims are still overly inflated to suit their own purposes, and that is not right," Mahar said.

"If Godfreys’ share of the vacuum market was small in volume and value (as Dyson must think it is) how come Godfreys were sold recently for over $A300 million?”

Mahar also added “Godfreys’ share could be inaccurate. GfK’s estimates could still be too low for Godfreys numbers".

“June for Dyson was a spike to 37.2 per cent value share but more interesting, meaningful and relevant is the MAT (moving annual total) data that is at 31 per cent. Moreover if one extracts the June data spike, then an underlying trend line in the data concerned for the previous 12 months for Dyson shows a decline,” said Mahar.

“If one takes the New Zealand market (GfK do capture some 90-95 per cent of that market) as a 20 per cent benchmark of the Australian market (i.e.: NZ is 20 per cent the size of Australia in population and dwellings) then extrapolated out, it would suggest GfK’s data and additional estimates for the total Australian market size could be quite reasonably close to reality.”

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