Price erosion in TV category slows as consumers pay more for better TVs

Despite the recent weakness in the TV category and the fact that Australians are buying fewer televisions, those consumers that do open up their wallets are spending more on products in retail stores thanks to a boost in average selling prices. That’s according to new research from GfK Retail and Technology, which has released its GfK Temax Australia report detailing the highs and lows of the electrical retail industry over the third quarter of 2013.

According to GfK insights from Q3 2012, the TV segment had been contracting in value after peaking in 2009 and was beginning to contract in units, but figures from the same period this year indicate this collapse had slowed.

“There has been a marked slowdown in value decline for the TV segment, which still accounts for over 60 per cent of the consumer electronics’ sector value,” said the author of the GfK Temax report, Gwenno Hopkin.

“Volume declines remain in double digits, but due to an overall increase in average price, the year-on-year value trend for TVs is beginning to flatten out.”

Those consumers heading into retail stores have been drawn in by ever-increasing screen sizes which has been the “main driver of the average price increases” according to Hopkin, who said “consumers are shifting from 46-inch to 50-inch [models], and from 55-inch to 60+ inch televisions”.

Despite the 7.5 per cent year-on-year decline in the consumer electronics category as a whole, thanks to declines in “almost all” consumer electronics segments, it was not all bad news for CE retailers.

“The overall trends…disguise some smaller pockets of growth and opportunity,” said Hopkin. “The popularity of soundbars, for example, has fuelled growth within the home theatre systems sub-segment, which in turn is supporting the recovery of the audio segment.”

Featured image: LG’s Curved OLED TVs.

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