40% decline on the technical consumer goods market
Results of GfK TEMAX® Romania for the second quarter of 2009
The Romanian technical consumer goods market fell by 40.4% in the first half of the year compared to the first six months of 2008, to a total of EUR 664 million.
The overall market for electrical goods monitored by GfK TEMAX was EUR 308 million in the second quarter of this year, a drop of 46.8% compared to the same period of 2008. The market reached a value of EUR 664 million in the first six months of 2009, namely a downturn of 40.4%.
Sales development of technical consumer goods in Romania
Source: GfK TEMAX® Romania, GfK Retail and Technology
Small domestic appliances and telecommunications sectors dropped by 22.1% and 25.8% in the first half of the year. Major domestic appliances sales had a better quarter compared to the beginning of the year but the results for the current year show a drop of 37.1%. Consumer electronics also declined by 42.6%, closely followed by the photo sector with a negative growth of 43.2% for the first six months. IT and office equipment sectors had the worst performance as they dropped by 47.2% and 51.4% respectively.
SDA
Small domestic appliances continued to record a negative growth rate of 27.6% in Q2 2009, compared with the same quarter of last year, reaching 16 Mio Euro. The negative performance of the sector is driven by the poor demand of almost all larger product groups. The products which suffered the most are Shavers, Vacuum Cleaners and Food Preparation, which represent approximately 75% from the total amount. Within Food Preparation segment, Food Processors and Hand blenders are the products which registered a significant decrease, pushing the entire category down. On the other hand, product groups with relatively cheap average prices in comparison to other small appliances goods, such as Deep Fryers, enjoyed a positive development.
The negative trend reflects a drop in the people‘s purchasing power caused by the income decrease and by the low financial resources. Also, the depreciation of the local currency had an impact on the evolution of this market in terms of value.
"Another reason for the poor demand would be the major number of Romanian’s mentality of saving money: they are convinced that the devices should be used until they break up, without replacing them with others which have higher quality technical features or innovative product characteristics”, stated Ciprian Hatneanu, Retail &Technology Director GfK România.
Telecom: Smart Phones balance the negative effect on demand
In the second quarter of 2009, the telecom market decreased by 24.8 % comparing with the second quarter of 2008. The decline in sales of mobile and smart phones remained relatively stable for the first half of the year. Also, the decrease of price offers the possibility of choosing a smart phone instead of a traditional device making it more affordable.
Major Domestic Appliances: "Buy-back” program slowed the negative growth
In the second quarter of the current year, the major domestic appliances market reached a value of EUR 79 Million, following the negative pattern displayed this quarter by all monitored goods within TEMAX.
The "buy-back” campaign impact for Major Domestic Appliances triggered a slight increase, especially for Refrigerators and Freezers categories, when comparing this quarter sales with the sales of the previous one. Nevertheless, this did not save the whole sector from falling with 38% in comparison with the same quarter last year. Even if the built-in appliances are slowing down the negative trend, the economical slowdown continues to have a growing impact on the consumer demand for MDA goods.
CE – Q2 2009 sales of CE are at half the level reached in Q2 2008
In the second quarter of 2009, sales of consumer electronics dropped by almost 50% to reach a total of EUR 52 Million. The decreasing trend reached its peak in June, recording significant sales decrease for the main driver of the Consumer Electronics market – The Flat TV sets. If, in the same month of the previous year the sales of Flat TV were pushed by specific events, such as the European Football Championship, this year the economic slowdown impacted strongly the consumer demand. Recent campaigns unfolded in Q2 2009 on specific electronic goods, such as "Buy back”, failed to trigger a better sales performance than last year. It is notable, that besides LCD TV and Video Game Consoles all electronic products monitored within TEMAX reached in Q2 less than half the volumes amounted in the same period of the previous year.
Photo – Negative development
The photographic market also recorded negative figures. With a drop out of approximately 44% from the previous year’s quarter, this sector reached a total of EUR 9 Million. Marking the seasonal development of digital cameras, this sales performance is though EUR 2 Million higher than Q1 2009.
SLR cameras are undeniably more appealing to consumer now than they were last year, but price erosion triggered a negative development in terms of value for this segment. Conversely, the compact cameras show in Q2 2009 stagnation in terms of price - most visible in local currency.
IT: Monitors and desktop computers in drops
The IT sector in Romania dropped by 59.2% in the second quarter of the year compared to the same quarter of last year, reaching the value of 87 million Euros. This was because of an important decrease in volume and partially because of the decrease of the medium price, especially for mobile computers, considering the fact that the share of netbooks increased in the mobile computers and their price is significantly lower than the one of the traditional notebooks.
The most affected by the crisis were the desktop computers and the monitors.
OE: The sector most affected by the general drop
The office equipment kept on recording a sharp decrease (58.5%) in the second quarter of the year comparing with the same period of 2008, reaching a value of 10 million €.
Printers and Multi-functional devices (MFDs) showed a downward sales trend caused by the low levels of consumer willingness to spend.
Summary in table format
Source: GfK TEMAX® Romania, GfK Retail and Technology
The survey
GfK TEMAX® Romania is an index developed by GfK Retail and Technology to track the technical consumer goods markets. The GfK TEMAX® Report is published internationally. The findings are based on surveys carried out by the retail panel of GfK Retail and Technology. The retail panel comprises data from over 190.000 retailer outlets worldwide. All reports and press releases are also available at www.gfktemax.com.
GfK Group
GfK Romania is the biggest maret research institute in Romania, with a turnover of 9,1 million euros in 2008.
Set up in 1934, GfK Group is, today, after tens of years of experience and innovation, one of the world leaders in the field of market research, with 130 representative offices and active participation in more than 90 countries and approximately 10,000 employees. The activities of GfK Group fall into three segments: Custom Research, Ongoing Research for electronics and houshold appliances (Retail and Technology) and Media. For further information, visit our website: www.gfk-ro.com
