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Press Releases

Singapore TCG market grew in 2022 despite inflationary pressures

Press Releases

Singapore TCG market grew in 2022 despite inflationary pressures



GfK’s TCG Overview 2022 report outlined the key trends impacting the TCG industry, Sales of small domestic appliances (SDA) saw growth at 11 per cent while major domestic appliances (MDA) stood at 7 per cent.

Telecom sales declined at 2 per cent while office equipment and IT products reeled from a sales drop at 6 per cent.

Singapore’s photo sector reported 33.1 per cent growth and recovering back to 80 per cent of pre-Covid retail revenue. This is due to resumption of travels after lifting of border restrictions in the post-pandemic era. 

Office equipment and IT goods underwent slower growth after demand for home workspaces in the post-pandemic age had been fulfilled and employees returning to the office. The demand for telecom products had also softened with possible longer replacement cycles and as unit production waned, however the foldable mobile phones have created a niche in the premium segment reporting value growth.     

“Concerning SDA, the popularity of omnichannel retail platforms which flourished during the pandemic contributed to the boost in sales while premiumization in MDA such as front-loading washing machines and multi-door cooling equipment aided the hike. Both SDA and MDA witnessed growth due to manufacturers focus on the development of sustainability and smart (connected) device features.” said Mukund Tripathi, Head of Market Intelligence, APAC, GfK.

Evident price hike and sales surge to beat the impending GST rise

With manufacturers pressured to transfer rising input costs to consumers, a price hike is noticed in the Singapore market while a sales surge was revealed in December to avoid the upcoming GST increase from January 2023 onwards.

The average prices of bulky and higher cost items had risen with television sets by 9.6 per cent in 2022 from 2021 and washing machines by 11.5 per cent. Consumers are willing to spend more due to buy now, pay later schemes and zero per cent interest instalments. The government and property developers catching up on housing delays in the post pandemic period also led to the surge in sales.   

In December this year, the last month before GST rate hike, the consumers also made earlier than planned purchases as retailers introduced buy now, deliver later schemes, resulting in the sales growth in December month of washing machines, refrigerators, vacuum cleaners, and Panel television sets at 62 per cent, 48 per cent, 33 per cent and 29 per cent respectively. Sales inevitably declined across these key categories in January 2023, while the first half of the year is expected to be slow.

Two key categories in MDA, Washing Machine and Refrigerators the segment of front-loading washing machines and multi-door cooling refrigerators fueled the premium segment faster rate of growth

Online sales continue to gain significance post-pandemic

Since 2019, the online value share of the total TCG market increased threefold to 26 per cent in 2022. The highest shift seen was in SDA, which stood at around 50 per cent in 2022 compared to 15 per cent in 2019 during pre-Covid times. Online sales of telecom products also increased from 8 per cent in 2019 to 24 per cent in 2022, which garnered a 38 per cent share in Singapore’s TCG market. With a rise in online shopping, omnichannel retail platforms consequently gained prominence since the pandemic which sparked a boost in sales in SDA.     

Sustainability set to progress

Sustainability is a key emerging trend in the TCG sector, acting as a differentiator for brands and manufacturers communicating sustainability actions that are imperative in connecting with environmentally minded consumers. During GfK Insight Summit 2022, it was discussed that monetary concerns are transferred into buying attitudes, which means that brands can command more cash for illustrating being green.

Looking ahead

With continuation of uncertainties in internal and external factors, there will be pressure of managing inventory, smart and innovative product Launch to stay ahead of the competition. This will lead to the conception of innovative product features and smart devices.  As seen in washing machines and air conditioning units those are developed to reduce water consumption per use cycle, and lower electricity consumption per running hour respectively.

2023 brings an opportunity for brands and manufacturers with a tourism recovery in the post-pandemic world, the opening of the Chinese economy and a decrease in transportation and shipping costs to drive the product innovation and differentiation yielding higher profits.