Covid and its impact on the consumer electronics market

Dubai - Market expected to stabilise and reach $548.4B at a CAGR of 18% through 2023

Since 2020, Covid marked a distinct shift in consumer buying behaviour in line with the massive change society underwent in terms of lifestyle modifications. People were spending a lot more time at home with their families, hence we saw a shift in consumer focus where life at home predominately took over by spending time with family or working entirely from home. In the onset of adults and children working, studying from home and longer TV time hours spent, a vast demand for IT and entertainment products such as laptops, panel TVs, tablets, notebooks and routers spurred in the region.

With people cooking at home more than ever before, it seeded a huge boost in sales and demand for kitchen appliances like cookers, coffee makers and ovens. Increase in time spent at home and consumer Covid precautionary measures in improving one’s home hygiene led to products like air purifiers and vacuum cleaners showing sizeable upward trends.

In the event of social distancing and isolation becoming a way of life due to Covid, infrequent consumer trips to the supermarket led to an increase in demand for freezers and larger refrigerators as panic buying caused a need for more food storage at home.

Overall, Covid has had a positive impact on the group’s business. In 2020, we covered the business deficit in the second half and took an annual growth over 2019. The trend is continuing in 2021: With an upsurge in other categories, the share of mobile phones was moderated, though it continues to be a dominant category. We did realise the importance of omni retail and have invested to strengthen our e-commerce operations.

The global consumer electronics e-commerce market is expected to grow from $282.6 billion in 2019 to about $373.6 billion in 2020 as the market initially experienced a surge due to purchases of electronic products that support work from home. The market is expected to stabilise and reach $548.4 billion at a CAGR of 18 per cent through 2023. Consumers are shifting from offline to online shopping, and this factor is the key driving factor of the consumer electronics e-commerce market. Augmented reality technology enhances the online shopping experience. The lack of an integrated end-to-end logistics platform for delivery of electronics purchased online is a key factor challenging the growth of this market.

We at Eros Retail did observe that brands with credible after-sales service assurance and technical superiority took a larger boost in sales in Covid. To meet the ever-changing market demands and trends of the UAE customer, Eros worked a new strategy with its existing brand partners like Hitachi, Midea and TCL to introduce more products in the segments where demand increased to bring in new models and increasing range during these times.

Eros has been very active in introducing very relevant products to the changing times in the UAE market with the addition of new brands like Ariston, Vaio, Avita, Amazfit and Rinnai in the second half of 2020 and in 2021. Ariston is a well-known Italian brand of home appliances that provides great value for money, Vaio is a known favourite laptop brand that stands for top quality, Amazfit is one of the fastest growing brands of wearables in the global market and Rinnai is a Japanese brand of cooking appliances. So, Eros introduced some new brands and reintroduced some old favourite brands, increasing the offerings and choice to the UAE consumer with products that are more relevant to the changing market demands and trends.

A revamped Eros e-commerce site and a big campaign on all digital platforms to promote Eros’ e-commerce to consumers looking to buy online resulted in very positive results. On the other hand, Eros distribution teams worked very closely with online retailers like Amazon to increase its offering and stepping up investments on the delivery and logistics support to keep pace with the exponential increase in online sales and business.

The writer is executive vice-chairman of Eros Group. Views expressed are his own and do not reflect the publication’s policy.