Electric appliance sales stay flat in year to date
Lacklustre demand despite World Cup
Thailand’s electric appliance market remained flat in the first five months of the year despite higher TV sales leading into the World Cup.
Jakkrit Keeratichokchaikun, senior vice-president and chief merchandising officer of Power Mall under The Mall Group, attributed the flat showing to sluggish sales of mobile phones, which represent about 40% of the total segment.
“There are no breakthrough technological products available on the market to stimulate customer spending,” Mr Jakkrit said. “Moreover, demand for air conditioners contracted because the weather was not as hot as expected.”
But he said the market showed signs of recovery in some categories, particularly for TV sets ahead of the World Cup.
The TV market reported strong growth of 9% in the first five months this year after a continuous drop for several years.
“Demand for TVs in May grew by 25% year-on-year,” Mr Jakkrit said. “The growth rate was also significant compared with only 10% growth during the 2014 World Cup. The huge growth is derived partly from price strategies that TV players offer for their large TV models.”
Mr Jakkrit said the TV makers also offer innovative technology, luring customers to buy new ones or replace their existing sets faster. People used to change their TV every seven years, but purchases have risen to every five years.
Thailand’s TV market was worth about 30 billion baht last year, with the figures expected to grow 12-13% to 33.6-33.9 billion baht this year.
Overall electric appliances totalled 235-240 billion baht in sales last year. For the first five months of 2018, the market was estimated at 100 billion baht.
Despite flat growth for the overall industry and flat sales at Power Mall, The Mall Group's sales grew by 6% in the first five months.
The growth was attributed largely to the company’s focus on innovative products to create demand from high-spending-power customers. Moreover, sales of home appliances such as washing machines, refrigerators and computers also increased.
“Growing demand for refrigerators, washing machines, TVs and small appliance products reflect the improving purchasing power of consumers,” Mr Jakkrit said. “More importantly, we have seen a more active customer response to our marketing activities than in the past.”
With better signs of consumer spending power, the company expects Power Mall sales to grow by 6% this year, compared with last year's growth of 3-4%. Details on sales figures have not been disclosed.
To achieve this goal, the company is spending 120 million baht to host the annual Power Mall Electronica Showcase from June 22 to July 15 on the fourth floor of Siam Paragon and the third floor of Emporium Department Store.
Over 200 brands such as Electrolux, Sony, Sharp and Panasonic will showcase their innovative products. The event is expected to spur sales of 410 million baht.
Power Mall is a business unit under The Mall Group, contributing roughly 20% to the group’s sales. The Mall Group reported total sales of 52 billion baht last year.