What factors are influencing consumer electronics market in Europe?
The global pandemic was a driver of growth within the European consumer electronics market. A new report published by RetailX predicts which factors will influence the industry at large moving forward.
The report from RetailX begins by offering a short history of the annual revenue within the consumer electronics market. The market reportedly had its first major shift during the 1970s, thanks to product innovations in gaming, home computing, hi-fi sound systems and colourised television. The sector has come a long way since then, with global online sales of consumer electronics jumping from approximately €434.99 billion ($473.2 billion) in 2020 to a forecasted figure of approx. €496.4 billion ($540 billion) in 2027.
The global pandemic led to the consumer electronics sector seeing unprecedented growth. The sector grew by 24% in terms of e-commerce when compared to 2019, outperforming demand for pharmacy, personal care and hygiene products, as well as fashion, shoes and accessories products along with sporting goods and toys. In actuality, the only sectors which outperformed consumer electronics in terms of e-commerce during the pandemic were books, music, films and videogames, home and garden, and groceries.
RetailX notes that sectors that enjoyed the most growth because of the pandemic centred around the home. “In fact, the surge in entertainment demand from locked-down consumers led to the increased purchase of many consumer electronics staples such as smart TVs, smartphones and computers, driving growth,” the report notes.
The global pandemic had an obvious influence on the rising demand for consumer electronics, with working from home trends leading consumers to purchase electronic items such as computers, smartphones, digital cameras and even lighting to help with their home setup.
The pandemic-driven rise in consumer electronic sales was an international trend, with there being a 43% growth in sales of premium consumer electronic sales. The report cites Latin America as being the region that saw the highest growth, with a 53% rise in sales of premium consumer electronic products and a 30% increase in standard electronic products.
How will the United Kingdom’s exit from the European Union affect the consumer electronics market?
The report notes that Brexit has had far-reaching effects on the retail sector in Europe, and the consumer electronics sector is no different. Consumer electronic products that are sold in the United Kingdom are required to have a UK Conformity Marking as of January 1, 2021, instead of meeting the EU conformity assessment criteria.
The European Union’s CE standard has been replaced in the United Kingdom by the UK Conformity Marking, which means that there is a new element of regulation required for both consumer electronics manufacturers as well as sellers. The report claims that this development has the effect of “slow[ing] down” items being brought to the market, as well as influencing goods that are imported from the United Kingdom into the European Union and vice versa.
The role of lithium in shaping Europe’s consumer electronics market
With lithium identified as a core component of batteries, supply of the chemical element is a major talking point regarding influences to Europe’s consumer electronics market, especially seeing as the electric vehicle sector is inspiring rising demand in lithium.
In 2021, demand for lithium was estimated to be approximately 500,000 metric tonnes of lithium carbonate equivalent (LCE). The report says that, by 2030, the demand could be between three million and four million metric tonnes of LCE.
Lithium production is forecasted to grow by approximately 20% year-on-year from 2020 to 2030. However, the report states that more work may be required to ensure supply for lithium can match demand on a global scale.
The solution to this could come in the form of new technologies that are used to recover lithium carbonate from oil drilling wastewater. This, as well as advancements regarding affordable lithium recycling technologies could help navigate the gap between supply and demand of lithium in Europe moving forward.
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