Canon reveals digital lifestyle spending still strong in Australia

Canon’s latest Consumer Digital Lifestyle Index (Canon CDLI) – the nation’s definitive snapshot of consumer technology retail sales every six months - shows Australians’ appetite for digital lifestyle products is still healthy, with $3.27 billion spent in the first half of 2010.*

Sales growth of Australian digital lifestyle products has normalised, compared with the extraordinary growth achieved in 1H 2009. The total value of products now covered in the Canon CDLI reduced by 4.6%, from $3.43 billion in 1H 2009 to $3.27 billion in 1H 2010. Influencing the results were factors such as the cumulative effects of six consecutive interest rate rises, global uncertainty concerning economic growth, and the winding back of the significant economic stimulus measures that had supported 1H 2009 results.

Treating 2009 as an anomaly, 1H 2010 is up by 6.3% on 1H 2008, with an average annual growth rate from 1H 2008 to 1H 2010 of 3.15%. This demonstrates that demand for CDLI listed products has remained strong.

“The latest Canon CDLI confirms that Australian consumers still love buying new technology despite the uncertainly in the global economy, and the trend towards high-image-quality products we found in previous reports has continued in 1H 2010,” says Darren Ryan, General Manager – Consumer Product Marketing, Canon Australia.

The latest results also show that Australians acquired an average of 2.41 new digital devices per person in 1H 2010 (up 13% versus 1H 2009) suggestive of an appetite for more digital options.**  Demand for more is further supported by the fact that a large proportion of recent CDLI product purchases are for an additional device, e.g. an additional TV for the bedroom, another camera, an second PC for entertainment (18% compact cameras, 27% Digital SLR cameras, 12% Panel TVs and 31% personal computers). Further, the latest Canon CDLI uncovered that consumers are satisfying their growing appetites for digital faster, as the purchase cycle for cameras, TVs and PCs has shortened compared to a year earlier.

“One of the new and important trends to emerge from the latest Canon CDLI is a shift towards complementary device usage where consumers are purchasing more, and more often to maximise the variety of options available for watching, creating and sharing content,” says Ryan.

“The latest generation of products, which have interconnection technologies such as HDMI, makes it easy for consumers to own multiple but complementary devices, rather than sticking to a single all-in-one device. Together with the shift from analogue to digital technology, which has seen the Internet emerge as the digital lifestyle “hub”, consumers can capitalise on the best aspects of their varied devices while enjoying an integrated lifestyle experience.”

The top three categories to show growth in sales value were Personal Video Recorders (PVRs), up 11%; DVD recorders, up 3%; and LCD TVs, up 3% compared to the previous six months. Much of this growth can be attributed to the digital switch-over and fierce price competition.

In volume terms, sales of camcorders with solid state memory increased by 63% (now the dominant format at 61% of total camcorder unit sales) and Full HD camcorder unit volumes grew by 21%, as the trend towards high-quality image capture continued.

Consumer expectations of image quality also pushed the sales volume for flat screen TVs and Digital SLR cameras up, 39% and 6% respectively.

The impressive result for advanced TVs can be attributed to the Digital TV transition. The appeal of advanced TVs was especially evident in the last three months of the Canon CDLI reporting period, where the volume of Full HD 1080P models grew by a massive 112%, compared with the same period in 2009.

Moreover, the now accepted HD video feature on most compact and many DSLR cameras also shifts the landscape in that consumers can seamlessly migrate from HD content shot on their cameras to the HD screen in the living room.

Further, the Canon CDLI found that communicating through images has become increasingly important, with Australians taking more photos than ever - 111 pictures per month on average (up 26% compared with 1H 2008). Image printing also continues to be important in the digital imaging lifestyle, with home printers being the most frequently used method of photo printing. Social media is responsible for a strong drive to connect by sharing photos online (40% of people now upload photos to the Internet and Facebook is the most popular destination).

“We are also finding that many consumers are at the tipping point of pushing through from the compact camera category (point and click) and migrating to the more involved category of cameras in the DSLR category, which offers users greater creative potential and the ultimate in image quality.”

“The digitisation and proliferation of media platforms, the availability of affordable high-quality devices and the skyrocketing popularity of social media sites means there’s everything to suggest that discretionary spending for consumer technology will remain robust as we head into the peak shopping season,” says Ryan.

Key digital lifestyle trends to emerge from the report include:

· Australians increased their digital device purchases from an average of 2.13 per person in 1H 2009 to 2.41 devices per person in 1H 2010, indicating a behavioural trend of complementary device usage.

· 67% of Australians now use their PC/notebooks in the living/lounge room.***

· Internet TV (IPTV) viewing almost doubled in the 6 months to 1H 2010, from 2.6% to 4.7%.

· We are watching more TV content on PCs (22% in 1H 2010; up from 13% 6 months earlier).

· We also watch more TV on TVs (4.5 hrs per day in 1H 2010; up from 3.5 hours per day in 2H 2009).

· “Image quality” ranks as the #1 priority among digital camera buyers.

· We’re taking more photos than ever before (111 per/month), up 26% compared with 1H 2008.

· Social media is encouraging increased usage and creative applications for digital imaging, with 2 in 5 people uploading photos to the Internet (Facebook being the most popular destination at 1 in 3).

* The Canon CDLI is independent research commissioned by Canon and compiled by GfK using information on sales figures (units and dollar value) provided by GfK's retail audit panel.

** The figure for 1H 2010 is 3.28 if games consoles, MP3 players, DVD players/recorders, PVRs,satellite navigation units, home theatre systems, tablet computers/eBook readers are included.

*** Between 1H 2009 and 1H 2010, personal computers achived 26% volume growth according to the latest Canon CDLI.

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