TCG market proves its resilience to the pandemic

Image by Colin Behrens from Pixabay

GfK and gfu Consumer & Home Electronics, organizer of IFA, presented – on the occasion of the IFA 2020 Special Edition – the findings about the global consumer and home electronics market development in the first half of 2020. The value of the global Technical Consumer Goods (TCG) market, excluding North America and South Africa, fell to €306 billion during the COVID-19 retail shutdowns. GfK’s panel market recorded a decline of -5.8 percent for TCG global sales for the first half year of 2020. Compared to other industries, this is a relatively small decline as this market benefitted from “at-home” needs and digitization during lockdown. Kai Hillebrandt, chairman of the supervisory board of gfu Consumer & Home Electronics, states: “Globally, the home electronics industry has proven to be very resilient globally during the COVID 19 pandemic. At around six percent, the global decline in sales in the first half of the year was very moderate compared with other sectors. This development can be explained by the industry’s innovative strength and the fact that the home electronics segment is able to offer a large number of technical products for stay@home that are in high demand during the crisis: from devices for home based work and home schooling (work@home) to products for all areas of the home – like entertainment (entertain@home), food preparation (eat@home), cleaning, washing – as well as health care and well-being”. According to GfK’s Consumer Pulse study, 83 percent of survey respondents changed their shopping behavior during the pandemic. The study also reveals that during the core impact months of March to June eight in ten (78 percent) of consumers were concerned about the pandemic. However, today 85 percent are concerned about the ripple effects of the pandemic on the economy. Despite the inevitable challenges to all markets in H1 2020, the TCG market proved to be resilient, declining by only -5.8 percent as consumers turned to technology to help them cope with the crisis.
Besides, according to GfK´s Consumer Life survey, more than half (53 percent) of consumers globally agree with the statement “I am always looking for ways to simplify my life”. When the entire world has moved in home, any appliance which simplified life and saved consumers time spent on chores was much appreciated. When lockdowns were being initiated, consumers stockpiled frozen food, driving the immediate need for freezers and this is clearly reflected in the sales figures. For instance, in the weeks between March 2 and March 22 volume sales grew by 317 percent in Great Britain and by 185 percent in Germany. Once the stockpiling moderated, next came a steady demand for food preparation appliances. This characterizes the “Adapt” phase, with volume sales in the weeks between March 23 and April 26 growing by +28 percent in Germany. The trend for “eat at home” continued steadily post-lockdown and during the “Revenge Shopping” phase the food preparation category grew by +24.8 percent in value terms, driving value growth in the small domestic appliance sector by +8.6 percent. While some major domestic appliance (MDA) categories also experienced sizable growth, e.g. microwave ovens (+36.8 percent), the MDA market overall experienced a value decline of -8.6 percent decline.