What you need to know

Consumer spending on electrical goods grew for a sixth consecutive year, as it is estimated to grow 5.6% in 2019. This was up on the previous year (4.8%), buoyed by resilience among the consumer base, and continued real wage growth. However, the market is yet to recover to pre-Brexit heights (2015: 8.7%), as it navigates uncertainty and a cooldown in the housing market, though transactions remain historically high.

Breaking the market down, every sector grew in the past year. Personal care remains a strong growth driver, buoyed by hero products such as Dyson’s hair care and wider innovation personal hygiene, although it remains a small component of total spending (7.4% in 2019). Household appliances, a traditional driver, continued to grow, aided by the continued boost of smart home demand, although growth slowed on 2018. Elsewhere, audio-visual, a category that had been in long-term decline, recovered in the past year, aided by 4K TVs and a new wave of home audio (soundbars, Echo devices etc).

However, the specialist sector contracted again, as it lost further share to online-only retailers. Online-only was also the main benefactor from the decline in the grocery sector, following the 2018 closure of Tesco Direct and turmoil in the department stores sector. Accordingly, the gap between the specialists (32% in 2019) and online-only (28.2%) is narrowing. If this trend is not reversed then we could see online pure players, underpinned by Amazon, overtake the channel during the next decade.

Within the market, consumer demand is increasingly dictated by the widening gulf between younger and older shoppers. This is especially true of the split between on-and-offline channels, ramping up pressure on the physical sector as some younger consumers now bypass the store altogether. This has been catalysed by recent advancements in mobile purchasing. As such, if multichannel and store retailers are not proactive in leveraging this local presence, they risk losing this crucial customer base. However, this can be addressed through innovation in the service and in-store proposition.

Products covered in this report

This Report uses market and consumer research and key retailer metrics to give an overview of the UK electrical goods market. The electrical goods market is a diverse one in terms of both the products sold and the retailers that sell them. We have split the product market into four key segments for each of which we provide a market size and forecast:

  • Household appliances – Consisting of both major appliances, such as refrigerators and washing machines, and small appliances, such as coffee machines and kettles.

  • Audio-visual and photographic equipment – Consisting of audio-visual products, such as TVs and stereo systems, and photographic equipment, such as digital cameras and projectors.

  • Computing and telecoms – Consisting of information processing equipment, such as personal computers and tablets, and telephone and telefax equipment, such as mobile and home phones.

  • Personal care appliances – Consisting of electrical appliances of personal care, such as electric razors and hairdryers. The full range of retailers and products covered by these segments is covered in more detail in the Appendix of this Report.

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