Japan Home Appliance Market is Back to Growth

Right now there are winners and losers in Japan, research shows

The decline in sales of home appliances of the past few years in Japan, was reversed in 2016. Meanwhile the Consumer Electronics market is experiencing demographic shifts that are bringing both highs and lows.

The Japanese consumer appliance market saw a return to volume growth in 2016, having seen sales suffer from the impact of the VAT increase implemented back in 2014, according to research by Euromonitor International. A significant rise in sales in 2013, as consumers rushed to buy appliances before prices went up, led to a drop in demand in the next two years. But in 2016, several categories saw a turnaround, particularly major appliances including fridges and washing machines.

Home appliance sales are expected to shrink in the short-term however, the effect of an ageing population and diminishing household space on large appliances including fridges and washing machines.

It has a wide-ranging offer in consumer appliances, but expansion in its core personal care appliances particularly has brought strong growth.

The consumer electronics retail market in Japan, meanwhile, saw a decline in 2016 – but the decline related to changing consumer habits and demographic shifts, rather than any perceived long-term downturn, according to research by Euromonitor International.

The decline was, in-part, down to an ongoing shift towards the smartphone as an all-in-one device, which means that many consumers are buying fewer items.

Countering the decline, however, is a sharp increase in sales of wearables. There was an increase in the number tourists visiting Japan to go shopping during the review period – particularly from China – encouraged by a weak yen and relaxed duty free and visa regulations. So many leading electronics and appliance specialist retailers targeted Chinese tourists by offering multilingual sales staff, targeted discounts and additional duty-free payment counters. But a now strengthening yen and a slowdown in China’s economy will reduce this trend.

Apple enjoyed a double-digit retail volume share in 2016 but was the only top-10 player to gain share – the Apple Watch particularly appealed to retail tourists.

Domestic players including Sharp, Sony and Panasonic remain strong through innovation and product development.