Southeast Asia’s technical consumer goods sector (TCG) turned in a positive performance in 2019; making it one of the few regions in the world that still managed a positive growth in spite of the slowdown seen worldwide. The overall TCG in four of the five tracked markets—Malaysia (9.5%), Thailand (7%), Singapore (2.4%) and Vietnam (1%) reported increased sales revenue last year in the single digit range. Only Indonesia turned in flat performance. Total value of the market reached EUR 46.4 billion.

Among the six TCG sectors in GfK’s Point of Sales tracking, Small Domestic Appliances (12.9%), Major Domestic Appliances (9%), Information Technology (3.9%) and Telecoms (3%) reported healthy growth. Telecoms—accounted for largely by smartphones—is the dominant sector in the TCG market, contributing to over half of the total revenue in Southeast Asia.

“It is interesting to highlight that although a slight decline was seen in the global Telecoms market, the sector continued to grow in this region,” observed Alexander Dehmel, Associate Director at GfK. “In fact, Southeast Asia is one of the few regions worldwide where smartphone sales have not yet reached a plateau—a clear indication of consumers’ sustained interest in the device, driven by the continued innovation of manufacturers in an intensely competitive market.”

Air treatment products and air conditioners were key propellers of the strong showing by Small Domestic Appliances and Major Domestic Appliances—the top two TCG growth sectors in 2019. Consumer demand surged due to heightened concerns towards air quality during various periods throughout the year across the different markets.

“Air treatment was one of the hottest topics in 2019 with consumers purchasing products to make their lives healthier and more comfortable,” Dehmel commented. “With the heatwave that swept through parts of northern Southeast Asia, high level of pollution in cities like Bangkok, and severe haze blanketing several countries in the region – the desire for clean and cool air spiked in 2019.”  

GfK findings also revealed the increasing propensity for Southeast Asian consumers to spend on products that are able to make their lives easier. This is seen across several categories in Small Domestic Appliances such as Home Comfort (Stick and Robotic Vacuum Cleaner), Personal Care (Shaver, Hair Styler, Hair Dryer, Dental Care) and Kitchen Appliances (Rice Cooker, Food preparation) which reported robust growth across all the markets, largely in the premium segment.

“With the US-China trade dispute now settling down, the TCG market in Southeast Asia is anticipated to remain positive, with an outlook of +5% for the region,” added Dehmel. “However, market performance will also be dependent on the severity of the coronavirus outbreak, and how the weather will pan out this year. In general, GfK foresees continued healthy growth in Major Domestic Appliances and Small Domestic Appliances, as well as a continuing upward trend towards premium products,” he concluded.

Globally, GfK experts expect consumer spending in the TCG market to increase by 2.5 percent in 2020 to an estimated €1.05 trillion*. The tech and durable goods market across all regions are anticipated to turn in positive growth in the range of 2 to 3 percent in value. GfK released these figures at the recent CES trade show held in Las Vegas.