Dont Blow It GFK Warns CE Retailers
0Overall Score

The penetration of flat panel TVs in Australian households is increasing at a rapid rate claims GFK, with analysts claiming that the industry could get a big boost running into Xmas from the release of billions of dollars in funding by the Federal Government.

Several retailers including Clive Peeters, Harvey Norman and JB Hi Fi claim that they also expecting big sales between Boxing Day and the New Year. However retailers have been warned to not “Overdo the offers or incentives”.
GFK data shows that 1-in-7 Australians now own an LCD TV, with 1-in-13 owning a Plasma TV. They are also investing in home theatre systems and other attach devices claims the research Company.

 Evidence of this they claim is 1 in 5 now owns a DVD player. 1 in 9 a DVD recorder and 1 in 3 a games console.
 GFK claim that DVD players have the largest penetration of Australian households despite DVD recorders being the newer technology. However Games Consoles are, by far, the fastest growing of these three major component categories.
In the first six months of 2008, Games Consoles recorded sales of a$224 million, an increase of 45% on the first half of the previous year. In contrast, DVD players and DVD recorders registered decreases of 16% and 8% respectively for the same period.

In response to the demand for TV components, some retailers and manufacturers have been giving them away for free as part of the sale of a TV, in an attempt to attract flat panel consumers and this has proved very popular they claim.
However, when it comes to these offers influencing the actual decisions made by flat panel buyers, the effect is far from predictable.

Recent data from GFK’s Australia ConsumerScope study shows, that although many people are influenced by giveaway promotions, around 40% would have made the same purchase decision without the incentive. This does not suggest that such promotions are failing, but it is clear that they are not all equally as persuasive says the researcher.


They say that the consumer response to giveaways is category-sensitive and also depends on the free product. Some giveaways tend to steer a consumer towards alternative models within a selected brand’s range, whereas others are powerful enough to instigate a brand switch.

At least one trend, however, appears to be consistent across product categories: as the price of the “paid for” item increases, giveaway promotions become more effective at switching consumers to a different model within a preferred brand’s range, and less effective at switching consumers to a completely different brand. Although a select few giveaway promotions are able to contradict this trend, the overall implication is, that compared with lower-end consumers, big spending consumers are less likely to switch brands because of a giveaway.

These high spending consumers are more inclined to respond to giveaway promotions by being up-sold to another model within their favourite brand’s range. Retailers and manufacturers have already begun unveiling their latest promotions designed to encourage cautious consumers to celebrate Christmas as usual and, in an uncertain economic environment, it will be more critical than ever to select and target such promotions accurately.