The Korean TCG market declined slightly in Q3 2014

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Data published by GfK Temax Korea show that only two of the seven technical consumer goods sectors in Korea expanded and reported positive results in Q3 this year, compared to the same period last year. Although the office equipment and consumables and major domestic appliances sectors reported growth, the information technology, telecommunications, photography and consumer electronics sectors declined. The overall market was down by 5.9% in Q3 2014.

Office equipment and consumables: a rise in sales of multifunctional devices
Office equipment and consumables was the fastest growing sector in Q3 2014 when compared with Q3 2013. Multifunctional printers garnered robust growth of 36% which helped to drive the overall sector up by 24% to reach KRW57 billion in the third quarter of this year.

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Major domestic appliances: strong growth in dishwashers, built-in hobs, and “kimchi” refrigerators
The dishwashers, “kimchi” refrigerators and built-in hobs segments grew by 38%, 19% and 14% respectively to help grow the Korean MDA sector by 4.4% in Q3 2014, compared to Q3 2013. The sector managed to generate a total of KRW1,106 billion in the third quarter.

Small domestic appliances: a mixed performance across segments
In the SDA sector, major product groups including food preparation products and rice cookers expanded by double digits in Q3 2014 against Q3 2013. However, several key products also reported declines, such as air treatment equipment, shavers and garment steamers. Over KRW524 billion worth of SDA products were sold between July and September 2014.

Consumer electronics: lower demand for Panel TVs in third quarter
The majority of CE products – including the largest segment, Panel TVs – reported a decline in sales in Q3 2014, compared to the same period last year. With lower demand for PTVs in the third quarter, the overall CE sector was down by 6.5% in revenue to reach KRW627 billion.

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Photography: slowdown in camera sales persisted in Q3 2014
Sales in the photography sector fell by 9.9% when comparing Q3 2014 with Q3 2013. Both digital cameras and mirrorless cameras declined in revenue generated – by 10.4% and 8.1% respectively – with revenue generated for this sector reaching KRW175 billion.

Telecommunications: strong fall in sales
In Q3 2014, the telecommunications sector reported a double-digit fall in sales of 10.3%. The value of the market in Q3 2014 declined to KRW1.68 trillion, when compared to Q3 2013.

Information technology: smaller demand for desktop and mobile computing
Sales of mediatablets continued to surge in Q3 this year, garnering a robust 21.3% increase in sales, compared to the same period last year. However, the decline in earnings of the two biggest IT segments – desktops and mobile computers – pulled the overall growth figures down. Korea’s IT sector totaled KRW783 million in Q3 2014, and was down by 12.7% when compared with the third quarter of last year.

The outlooks of GfK Temax Korea
The Korean TCG market is expected to continue its slowdown to remain in negative territory in the final quarter of 2014. The telecommunications sector – the major driving force of the overall market until the first half of this year – will be impacted by recent government regulations on subsidies for mobile network operators. Without any attractive new products boosting demand in the overall TCG market, it is expected that only the premium segments will lead the positive growth as a result of market saturation.

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