Gearbest Tech
【Gearbest】”I don't know which direction the wind is blowing – I am in a dream, heartbroken in the sadness of the dream!” When hundreds of thousands of Silicon Valley people encountered a cold wave of layoffs, they were forced to leave the office. Surviving and passing the cold to everyone has become a necessary strategy for the survival of current companies.
Throughout 2022, from mobile phones to PCs, from the Internet to automobiles, everything is permeated with cold air. Where is the spring for the industry?
According to statistics from the China Association of Automobile Manufacturers, from January to October 2022, domestic automobile sales reached 21.975 million units, a year-on-year growth of only 4.6%, showing a sign of fatigue. Some institutions have predicted that the domestic sales of new energy vehicles this year will exceed 6.5 million units, and BYD and others will become one of the few winners. However, new energy vehicles have never been able to save the huge automobile market single-handedly. This is because its penetration rate is not high enough, and the proportion of 30% cannot influence the situation. The automotive industry is not the only track for new energy vehicles, but it has the same bone-chilling cold. In the once-hot autonomous driving track, capital has been exhausted, and the giants hiding behind have lost confidence and patience. Someone in the autonomous driving industry joked: “When capital abandons you, it doesn't even say hello.”
In traditional industries such as smartphones, PCs, and smart TVs, a large number of manufacturers are still struggling to support sales. In the meantime, they found hope and solace in the financial reports of several quarters, even if this was just a short spring in the digital sense. For many industries, the epidemic or the occasional stimulus is nothing more than a virtual spring, making us mistakenly think that the heavy air has been reopened. Therefore, we must look for new opportunities to survive this cold winter.
The game industry is as hot as it is cold. Under the restrictions on the issuance of game licenses, domestic games are experiencing a cold winter. Data shows that the actual sales revenue of the domestic game market in the third quarter of this year was 59.703 billion yuan, a double-digit decrease both year-on-year and month-on-month. Even game giants like Tencent have been hit hard. However, the previous statement can be reversed. The game industry is as cold as it is hot, because this industry has never lacked heat. In addition, domestic game licenses were issued again not long ago, releasing positive information.
In any case, what we are entangled in is not how cold the winter of the industry is, but where the spring of various industries lies. Gearbest will conduct an in-depth discussion on the topic of “The C position in the living room has changed, how can TV manufacturers return to the top?”
Television is something we are all very familiar with. In the past, the first thing many people did when they got home from school or get off work was to turn on the TV, tune to their favorite channels, and relax. In contrast, nowadays, people are less and less willing to turn on the TV after returning home, and more people are sitting on the sofa playing with their mobile phones and tablets.
At home, we rarely hear the sound of TV. Except for watching some celebration parties when the family is reunited, we no longer turn on the TV. Now it seems that TV has lost its charm. Some new families don't even install TV anymore. It has lost its status as the big brother in home appliances. Some people can't help but ask, is there still hope for the TV industry to usher in spring?
Even if it's cheap, it won't sell
More than a decade ago, almost every household would install a TV. The TV was like the “stabilizing force” of the living room. At that time, people generally believed that a living room without a TV could not be called a living room. When mobile phones, tablets and other products were not yet widely popular, TV was the most popular electronic product in people's daily lives. It could bring a variety of program information, enrich people's entertainment life, and provide entertainment activities for people after meals.
In recent years, the rapid development of science and technology has brought about earth-shaking changes in television. Televisions are no longer thick and rectangular, but have become thinner, lighter, and larger. The picture quality has also undergone a subversive growth. We can see more details and more shocking pictures on TV. However, along with the new technology comes increasingly fierce market competition. Looking at the entire TV market, more and more players are entering the TV track, and the track is becoming more and more crowded.
In addition, we can see that in terms of price, TVs are constantly “refreshing the lower limit”, and it is not a big problem to buy a TV for 100 yuan. Although the low-price competition in the TV industry has pushed the price lower and lower, from a realistic point of view, the situation is not optimistic, and TVs are still not selling well.
For China's color TV industry, the situation is deteriorating. In recent years, domestic color TV sales in 2019, 2020, and 2021 were 48.94 million, 44.50 million, and 38.35 million, respectively, lower year by year. In addition, the prices of key sizes in the online retail market for color TVs during this year's “Double 11” have dropped significantly. Compared with the past six years, this year is already the year with the lowest prices, but it has not yet driven the growth of the market size. According to data from Aowei Cloud Network, the online market retail volume of China's color TVs during the “Double 11” promotion phase in 2022 was 3.931 million units, a year-on-year decrease of 6.9%; the retail sales volume was 10.53 billion yuan, a year-on-year decrease of 9.7%.
This situation is not only happening in China. From a global perspective, the latest report released by market research firm Omdia shows that due to demand, as of the third quarter of 2022, global TV sales were 143 million units, with sales of US$72.39 billion, year-on-year decreases of 4.4% and 12.7%.
The “old generation” that was eliminated
From the above data, we can see that the global TV market is in a weak state as a whole and the market lacks vitality. In this regard, we believe that there are several main reasons for the poor sales of TVs.
On the one hand, the TV market has become saturated, with supply exceeding demand. my country's TV industry has entered the stock era. As we all know, TV is not a “fast-moving consumer product”, and the quality of TV sets is still guaranteed. Generally speaking, there is no problem using it for ten years. Therefore, when a family buys a TV, if there is no accident, they will not replace it for nearly ten years.
On the other hand, the emergence of mobile phones, tablets, and notebooks has replaced television to a certain extent. Compared with television, it is more convenient to watch videos on mobile phones and tablets, and the content is richer, so more and more TVs are gathering dust in the living room. According to relevant statistics, the TV power-on rate was 70% in 2016, while the power-on rate in 2021 has dropped to 27.7%, reaching the lowest level in history, and this data shows a continuous downward trend, and may reach a new historical low this year.
In addition, “Xingxing” projectors have begun to replace TVs and enter thousands of households. We can see that the status of TV in the family is no longer as good as before. More and more families have abandoned traditional design models and chosen more flexible design styles, purchasing projectors instead of TVs for watching movies. According to data released by research firm IDC, the shipment volume of the domestic projector market in 2021 was 4.7 million units, a year-on-year increase of 12.6%, and sales exceeded 21.4 billion yuan, a year-on-year increase of 15.5%.
Spring may be
Today, the overall situation of the global TV market is relatively stable, and the leading companies are relatively stable. According to data released by Omdia, in the first three quarters of 2022, the top five global TV sales were Samsung Electronics (20.2%), LG Electronics (12%), TCL (11.7%), Hisense (10.1%), and Xiaomi (6.5%); the top five sales were Samsung Electronics (30.2%), LG Electronics (17%), TCL (9.3%), Hisense (8.6%), and Sony (8%).
Although the TV market seems to have entered a cold winter, manufacturers are still exploring new ways out. From a technical perspective, manufacturers have begun to explore OLED/Micro LED/Mini LED/8K and other directions, and are committed to developing more advanced display technologies. For example, this year Samsung Neo QLED TV completed product iterations, and its products are hot-selling at home and abroad, and it still maintains a large leading advantage in the market. In addition, LG continues to expand overseas markets by relying on its deep cultivation in the fields of displays and OLED; TCL focuses on new display technologies, with quantum dots/Mini LED as the main focus.
At the same time, the market began to shift its focus to high-end large-screen products. Nowadays, people are increasingly pursuing the “cinema effect”: the screen must be large and the sound must be surround, so large-screen high-end TVs have become the first choice for many families. Against the backdrop of an overall decline in sales in the global TV market, sales of ultra-large OLED TVs have grown against the trend, with ultra-large-size products above 70 inches growing by nearly 18% year-on-year.
However, in addition to the “technology war” and “price war”, the “content war” is the most important point that cannot be ignored. Nowadays, television is no longer a rigid demand. If the development of the television industry wants to pick up, it is unrealistic to rely solely on price cuts. The most important thing is how to make everyone “want” it.
Watching movies alone cannot meet the needs of users. Manufacturers need to extend their services in many aspects, such as learning, gaming, office work, etc., to improve the interactive experience. In addition, manufacturers need to optimize the content experience so that consumers can obtain more abundant information through the simplest operations. They also need to reduce various dissuading operations such as interstitial ads and VIP membership to a certain extent, so as to increase the frequency of use and the startup rate of users. It is foreseeable that if manufacturers do not change their content, it will be difficult for them to survive for a long time in the future.
The current situation is not that bad, and TV still has many loyal supporters of older people. It will take some time for the post-00s and post-10s to rise, and TV manufacturers still have a chance. They need to keep up with the pace of the times and innovate to meet the needs of the current market.
Final Thoughts
Although TV sales are not as good as they once were, they will not disappear immediately, and there are still many challenges to face in the future. It is worth mentioning that the 2022 Qatar World Cup has officially kicked off. The quadrennial football feast has stimulated the sales of large-screen TVs, and the market has opened a new round of carnival. However, after this carnival, the industry must calm down and settle down to explore the road to spring.
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