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Promising year start for the Western European Technical Consumer Goods Market

GfK TEMAX® results for Western Europe, Q2 2019

The Western European markets for technical consumer goods are influenced by global megatrends that GfK has identified. See below for more info and further resources. 

  • Performance: Experiences are increasingly becoming a key purchase factor for consumer. Gaming leads that facet in IT. Learn more about gaming ecosystem.  > GfK infographic 
  • Borderless Shopping: How was the Black Friday in 2018? What were the most bought items? Which regions spearheaded this growth? Check out a quick snapshot with our infographic for Black Friday 2018. > GfK infographic 
    In order to deliver the borderless shopping experience, digital retail technologies are becoming ever more important. Read more about retailing of tomorrow in our blog articles. >GfK blog
  • Simplification: Consumers are prepared to pay more for products which make their lives easier. Connected devices can deliver on that need and simplify an over-complex life. Voice assistants set the next frontier of connectivity. 
  • Premium: Consumers increasingly agree that “It is important to indulge or pamper myself on a regular basis.” Aspirational products satisfy this need to express identity. They come at premium price and pamper the “me”.

To learn more about the trends and developments across TCG stay tuned to this page.

    • 09/03/19
    • Retail
    • Technology
    • TEMAX
    • Global
    • English

    Strong gaming ecosystem meets the cloud

    With an estimated value turnover of 140 billion USD in 2019 and projected robust growth, the video games industry has become a giant in the entertainment business. Gaming is about experiences. Experiences are for consumers. And in the world of gaming, “everybody can be somebody”. For many of the millions of gamers around the globe, gaming is a lifestyle. It offers a way of identifying themselves and expressing emotions, of being connected and belonging to a group. Linear gaming has evolved into multi-platform gaming ecosystem, on PC, console and smartphone/tablet, streaming and watching on video platforms, all of which are integral to gamers’ engagement.

    The importance of mobile gaming

    Smartphone and tablet developments provide a good understanding of multi-platform gaming and in particular, the current importance and future potential of mobile gaming. As smartphone displays grow, tablets needed to adapt and offer the bigger screen sizes too. In EU 15, over 5.7 million tablets above 9” were sold in the first half year of 2019, while smartphones reached over 17.2 million units in the same period. Although these devices aren’t currently suitable for high-end gaming, there’s the promise that this will change in the near future. Overall, these numbers demonstrate the current importance and further potential of mobile gaming.

    PC hardware as a gaming ecosystem

    When it comes to PC gaming hardware, we’ve experienced an evolution from a niche segment to a gaming ecosystem over the last few years. Turnover of over 5.3 billion euro, generated by gaming PC hardware in the first half year of 2019, exceeded the turnover for the whole of 2016 . In 2018, the turnover of consoles in EU15 fell slightly by -1 percent to 3.7 billion euro. Although over 14 million consoles were sold in 2018, they still recorded a decline of -4 percent. Sales of consoles dropped further in the first half year of 2019, recording a double-digit decline. At the same time, gaming notebooks generated 1.1 billion euro in EU15, which corresponded to a growth of +18 percent. However, revenue declined by -3 percent from January to June 2019, indicating signs of maturity. During the same period, gaming monitors recorded another strong growth globally up +42 percent, while monitors with at least 100 Hz refresh rate rocketed, growing by +70 percent. On average, gaming desktops cost 2.4 times the price of non-gaming ones, while gaming notebooks and gaming monitors achieve a price ratio of 1.6 times. Overall, gaming hardware offers an attractive price tag and margin to the industry and retailers. However, the current business model may well experience the transformative effect of the on-demand subscription-based model.

    Gaming reaches for the cloud

    With an estimated value turnover of 140 billion USD in 2019 and a projected robust growth, the video games industry has the full interest of the tech sector. Consumers are already used to streaming entertainment services from the cloud, and it seems it’s time for the gaming ecosystem to reach the cloud. In the last year, more focus has been devoted to cloud gaming, often referred to as the “Netflix for games”. The promise of delivering a high-end gaming experience on any device without the need for high-performing hardware may have the power to disrupt the gaming industry.

    The importance of WiFi and 5G

    Currently, connection speed is perceived as the possible bottleneck. This is especially true when it comes action games. Here, where every millisecond might be decisive, having an ultra-fast and reliable connection is essential – otherwise, hardcore gamers will be disappointed. Casual gamers, on the other hand, may still accept a time-lag of a few milliseconds. Combining cloud capabilities together with the technological promise of 5G may offer a technology leap to low-latency gaming, particularly when it comes to screen-independent gaming and gaming-on-the-go. In addition, with the advent of cloud gaming, the cost barriers to play may reduce, and more people around the globe could be encouraged to join. No matter what technology innovations are available, ultimately, the consumer has the final word. Gaming gear and hardware have been a key enabler for rich gaming experiences and, although the landscape might change in the future, one thing will remain consistent – the desire for immersive game play. One topic with global importance that we expect to become more relevant for gaming is sustainability and energy efficiency in the form of green gaming. The energy consumption of gaming devices is already significant and with increasing numbers of people playing more often on powerful devices and servers, this will only grow. Based on a GfK Consumer Life survey from this year, nearly 60 percent of people strongly agree that brands and companies have to be environmentally responsible. Although its main domain is virtual worlds, gaming has the potential to be very impactful in the real world.

    Want to know more about this topic?

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    • 08/20/19
    • Press
    • TEMAX
    • Global
    • English

    PC hardware for gamers: Performance and experience drive demand in a maturing market

    The gaming PC hardware market recorded a 15 percent increase year-on-year (January-June 2019) to reach over $6.1 billion turnover. 
    • 06/11/19
    • Retail
    • Consumer Goods
    • Trends and Forecasting
    • TEMAX
    • Global
    • English

    Clashing consumer trends battle for energy efficiency – pt. 2

    In part one of this blog series, we identified two clashing trends when it comes to consumers purchasing domestic appliances: Sustainability and Performance. In this post, we’ll try to better understand the interaction of these two core trends and explore their impact on energy efficiency.

    A disputed increase in energy efficiency

    Between 2014 and 2018, the average energy consumption of refrigerators has actually decreased by 2%. This represents a mix effect of different product segments which vary massively in their energy consumption. Side-by-Side fridges consume about 50% more energy when compared to Two-Door Combi fridges with No Frost technology. The trends towards larger and more energy-hungry appliances has almost offset the increase in the energy efficiency within comparable product segments (only 2% average energy reduction remains with this mix effect). Apart from the average energy consumed, if we look at the annual energy consumption of all sold refrigerators in 2018, the total sum of kWh even increased by 7% compared to 2014 (at a unit growth rate of 9%). This means that choosing larger and more energy-hungry appliances (performance/convenience related benefits) eats up almost all the technological efforts put into energy efficient innovations.

    Promising opportunities to save more energy in the future

    Within MDA 5*, almost 60% of energy is consumed by washing machines and refrigerators sold in 2018, which implies a big impact if such markets are subject to a change. Consequently, regulation standards bear quite a potential. For washing machines, the loading capacity plays a pivotal role: A+++ washing machines with 9kg+ capacity consume 18% more energy than a 6kg washer with the A+++ label. Scientific consumer research carried out by the University of Bonn** suggests that “consumers do not put more laundry into their bigger washing machines, but wash (almost) the same amount of laundry independent of the washing machine’s rated capacity.” Hence, these additional 18% of energy consumption is a potential for additional savings in the future. Some countries also present more potential in saving energy than others. In Germany, average energy consumption of A+++ washing machines is below the European average. Meanwhile in Great Britain, an average A+++ machine sold has used 19% more energy compared to the European benchmark. Besides regulatory approaches, there is also hope to stimulate awareness of energy efficiency when it comes to smart home appliances. In case transparency of real energy consumption increases (e.g. via live monitoring), this may stimulate more educated consumer behavior when deciding on a new appliance. As sustainability becomes more and more important to consumers, however, there is also a potential for the industry players to address such “energy savvy” consumers with products highlighting the best absolute energy consumption along with a reasonable capacity (e.g. 5-6kg). Differentiation can be achieved via the lifetime energy savings as well as a lower carbon dioxide footprint during production and lifetime.

    An opportunity arises

    There is a clear battle going on between the consumer demand for performance (capacity) and the need for sustainability. While the rise of Best-in-Class energy labels suggest that energy-efficient appliances are being sold more than ever before, almost all the improvement is lost because consumers continue to purchase larger appliances. It seems that even with low-involvement products like washing machines, the benefits of larger capacity (convenience) can beat the need for sustainability. This holds especially true when energy labels lead consumers to believe that they act responsibly while absolute energy consumption increases. The great thing about this “issue” is that another opportunity arises for brands to target “energy-savvy” consumers with solutions that truly advocates of energy efficiency. Smaller appliances can be promoted to them as an honest energy-saver for the good of our planet. * MDA 5: Washing Machines, Tumble Dryer, Fridges, Freezers, Cooking  **University of Bonn: Angelika Schmitz, Farnaz Alborzi and Rainer Stamminger

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    Download the full infographic here

    • 06/03/19
    • Retail
    • Consumer Goods
    • Trends and Forecasting
    • TEMAX
    • Global
    • English

    Clashing consumer trends battle for energy efficiency – pt. 1

    What are really today’s consumer trends when purchasing Technical Consumer Goods (TCG) such as smartphones, computers, TVs or washing machines? Consumer attitudes observed by GfK Consumer Life® as well as the purchase behavior at retail POS provide us with solid evidence that the most impactful drivers for people to make a purchase are:
    1. Performance: Enabler for rich experiences through high end product features
    2. Simplification: Automating recurrent tasks or making tasks more seamless
    3. Premium: Aspirational products making a statement about own identity
    4. Borderless Shopping: Consumers: I want it now!

    More consumer trends with big impact

    Sustainability is another decisive consumer trend, strongly present in the world of domestic appliances such as washing machines and refrigerators. Consumers now seek a significant potential to save energy which means energy labels are an important factor in the decision making process. The energy label in Europe has been a success story in that sense for the past decade – allowing for differentiation of manufacturers as well as contributing to consumers’ peace of mind by saving energy. In 2012, only 24% of appliances in European countries* had an A++/+++ label while the share of sold appliances with “Best-in-Class” labels increased to 62% in 2018. Appliances sold with A+++ rating are washing machines whereas this label is still rare in refrigerators or freezers. But this is only half the truth! On one hand, appliances with comparable size became more efficient in recent years (e.g. Combi fridges with No Frost technology consumed 9% less energy on average in 2018 vs. 2014) whereas on the other hand, more and more consumers turn to larger appliances. Performance is another rising consumer trend when it comes to technical goods. Consumers are also looking rich and convenient experiences, i.e. high capacity fridges helping to stock more food and hence, fewer shopping trips are required. However, more and more consumers feel the responsibility for our environment—global warming initiatives like “Fridays for Future” convey this evolving attitude. GfK’s Consumer Life® study confirms the advance of sustainability: In 2018, 45% of global respondents said that they feel guilty when they do something that is not environmentally friendly. This mindset has grown steadily from 37% in 2015. Obviously, two consumer needs clash here: Sustainability (energy saving) and Performance (energy hungry). Check back for part 2 of this blog to find out how these trends affect energy consumption in home appliances. *Data was acquired from 10 major countries in Europe: AT, BE, DE, ES, FR, GB, IT, NL, PT & SE.

    This blog is a preview of my presentation at
    ECEEE’s Summer Study


    Download the full infographic here

Table summary

Western Europe 15 - Q2 2019
Q3 2018 M. EUR Q4 2018 M. EUR Q1 2019 M. EUR Q2 2019 M. EUR Q2 2019 / Q2 2018 / +/- % Q1-Q2 2019 M. EUR Q1-Q2 2019 / Q1-Q2 2018 +/- %
Consumer Electronics (CE) 6,641 8,418 5,584 5,142 -10.0% 10,726 -11.5%
Photography (PH) 1,007 1,044 897 949 -3.7% 1,847 -5.9%
Major Domestic Appliances (MDA) 8,921 9,133 8,203 8,182 2.9% 16,385 0.7%
Small Domestic Appliances (SDA) 4,686 5,632 4,243 3,999 8.5% 8,242 3.4%
Information Technology (IT) 14,183 15,894 13,991 12,789 2.8% 26,780 0.1%
Telecommunications (TC) 15,806 18,294 14,001 13,337 -2.3% 27,338 -0.4%
Office Equipment & Consumables (OE) 3,213 3,449 3,191 3,030 -8.3% 6,221 -9.0%
GfK TEMAX® Western Europe 54,457 61,864 50,111 47,429 -0.6% 97,539 -1.8%