After a slow start to 2018, retailers are hoping for some respite for the remainder of the year and the upcoming FIFA World Cup in June may be the answer to their prayers.
With much anticipation around the sporting occasion and shoppers finally getting excited about the new technology on offer, electrical players are expected to experience strong revenue growth in the run up to the event. As the World Cup only occurs every four years these sales will be incremental and are forecast to help drive the electrical market to grow by 1.2% in 2018, which would be the highest growth in three years. However, as with any non-annual event we expect retailers to struggle to replicate these sales next year and growth is predicted to slow to 0.9% in 2019.
TVs are expected to benefit the most from the sporting event, providing a welcome sales boost after an extremely challenging trading period for retailers, with price wars considerably eroding average selling price and margin. Moreover, pre-2017 consumers have shunned recent technological advancements in the market such as curved screens and 3D technology, leaving brands and retailers struggling to bolster sales. However, over the past year fortunes have changed for these players with shoppers finally converting to more expensive models featuring OLED and 4K technology, as more content is developed which supports these HD experiences.
This year, British sports fans have a stronger incentive to trade up their TVs as there is ongoing speculation that the BBC will screen selected games for the FIFA World Cup in 4K HDR for the first time, driving demand for these models. What’s more the BBC recently live-streamed the second half of the FA Cup final in 4K HDR further encouraging these rumours. However, this has still not been confirmed and with less than a month until the games start there is no guarantee the BBC will be able to implement this.
Electrical retailers are taking full advantage of positive sentiment around the event offering deep discounts on TVs and even providing shoppers with fun promotions designed to entice consumers to trade up. For instance, online pureplay AO.com is offering shoppers the chance to claim up to £300 if England qualify for the knockout stages, on selected TV purchases with the value of the cash prize dependent on the selling price of the model. Additionally, Currys is currently giving shoppers a 1 in 20 chance to win back the price of their TV, when shoppers purchase 55’’ TV screens or larger. Not only are these promotions a novel way to interact with footfall fans, players offering a price matching policy will be unable to replicate this, putting them at a disadvantage.
Aside from TVs, the upcoming FIFA World Cup will mean shoppers are increasingly tempted to pick up accessories which complement these new purchases, such as soundbars, stands, mounts, cables and accessories, driving up revenue and average spend for these categories. Moreover, refrigeration sales are also forecast to benefit from the World Cup, in particular mini fridges, as shoppers invest in these appliances to accommodate any additional food or drink consumers are purchasing for the occasion.
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