domestic appliances market overview
Refrigeration
Refrigeration experienced a welcome return from several years of decline. Although American style side-by-side fridge freezers are still struggling, traditional fridge freezers and the bigger single door fridges saw a reversal of fortunes. Total cooling increased by 4% in value over the year thanks to one of the most acute cases of price polarisation in evidence. Cooling appliances over £700 experienced growth of around 10% while entry level models also grew at around 5% thanks to the surging activity of retailer trade brands.
E-tailing
Online sales grew year-on-year at a rate of around 21% in value giving the internet a creditable one fifth of the overall share of trade for total major appliances in the UK. ‘E-tailer’ success has not just been confined to the core freestanding essentials like washers and dryers. Some of the best performers have been cooking, hobs and cooker hoods which on average have grown by around 15% in value. The number of selling items online has also increased exponentially over the year and this has created a far more competitive marketplace. Pure internet retailers and the electrical independents have both seen proportional increases in sales thanks to this trend.
Retail channels
The more traditional retail channels have also seen a shake-up over 2010 in major appliances. Mass merchandisers have made substantial progress at both the lower pricepoints and at the premium end and this is not just retailer specific. Broader ranges in stores better known for pricing below the market average have shifted much of the emphasis in consumer purchasing. Kitchen, furniture and DIY sheds, the bedrock of built- in had a hard time keeping up with this widening appeal and sales in the first half were hit. The second half of the year painted a brighter picture, with cooking and hobs helping sales value pick up for both sheds and specialist kitchen retailers. Of the traditional electrical specialists, only the independents have had significant success at the above £500 mark. Whilst it’s safe to say category growth rose in 2010, claiming this will continue in 2011 would be rather short-sighted. We are entering unknown economic territory with a strong chance of disposable incomes constricting and home improvement projects being shelved. Over and above the VAT rise, product prices increased anyway. This was more noticeable when some retailers did not initially pass it on and whilst an uplift in promotions this year may off-set inflation, it could challenge volume growth through the year. ■
For further information please contact Anthony Williams at
anthony.williams@gfk.com or on 0870 603 8100
IndependentElectricalRetailer 48 BusinessBook2011
in association with GfK
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