MP3 Player Segment Still Second Largest in CE Market

With the increase in mobile phones with built-in music players, it is interesting to see that according to a GfK study, MP3/4 Players remain the second largest product group within the UK Consumer Electronics (CE) market, despite an 8% decline in value (Y/E September 2007) to £657 million. 8.5 million MP3/4 players were sold in the Y/E September 2007 - a 6% increase on the previous year.

An increasing proportion of products are now equipped with a video function. Just one year ago, Video Players accounted for 29% of market value. In September 2007, this figure has grown to 61%.

As memory becomes cheaper, so the move to larger capacity products becomes swifter; both for flash memory and hard disc drives. Y/E Sep 2006 saw just 8% of the Built-in Memory segment with 4GB+ products. This increased to 26% in 2007 and a much more significant 52% in value. Built-in Memory products in Video Players now also contribute much more to the market, making up 25% of sales in 2007 compared to only 3% in 2006.

The Internet is a significant retail channel for sales in this market: 25% of market turnover represents the largest proportion of any CE product category in the UK.

Whilst there can be price benefits from purchasing online, UK consumers are much more likely to purchase a higher value product when surfing, hence the average price of products bought on the Internet was £108 in September 2007 vs. £75 in high-street stores. This could have an impact on mobile phone retailers, who might be able to sell higher-end products more easily online than via retail outlets.

Posted to the site on 4th December 2007