2006 Christmas Sales in Major Overseas Markets and Retail Outlook for 2007 - PowerPoint PPT Presentation

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2006 Christmas Sales in Major Overseas Markets and Retail Outlook for 2007
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2006 Christmas Sales in Major Overseas Markets and Retail Outlook for 2007

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  1. 2006 Christmas Sales in Major Overseas Markets and Retail Outlook for 2007 Research Department 28 December 2006

  2. 2006 Christmas Sales in Major Overseas Markets 1

  3. US – Retailers to Post4-5% Growth Basic Positive Factors Fairly solid expansion helped by last-minute flurry • Low joblessness • Steady income growth • Respite of oil prices • Windfalls from stock market Other Positive Factors • Longer Thanksgiving-to-Christmas • A full weekend of last-minute purchases • An influx of tourists 2

  4. US – Battlefield between Shoppers and Retailers • Prevailing economic slowdown • Slackening housing market • Still-high fuel costs • Selected and procrastinated purchases Negative Factors Even more aggressive discounts and promotions Retailer Strategies • Early implementation of promotions • Deeper discounts • Issuance of gift certificates 3

  5. US – Polarisation of Market Discounters and mass merchandisers • Caution remained the buzzword • Sustained popularity of mass merchandisers and discounters Better performance of value-for-money merchandise • Low prices • Free delivery E-tailers High-end stores • Still-strong showing due to continued spending spree of high-income consumers 4

  6. US – Demand Pattern Similar to Last Year’s Consumer electronics • Flat-panel TVs • Handheld digital audio players • DVD players, digital cameras, mobile phones, notebooks Consumer electronics remained hot sellers • Video game consoles – Wii & PS3 • TMX Elmo • Certain dolls and licensed toys – Barbie, Bratz & Dora the Explorer • Educational toys, robots, trucks & cars, children’s MP3 players Toys Clothing • Sales affected by warm winter • High-end apparel • Fine jewellery • Higher-priced watches Luxuries 5

  7. Europe – Generally Firmer Festive Spending Better sales recorded for the major markets amid moderate economic expansion • Still-high unemployment • Still-high oil prices • Higher interest rates • Shoppers to buy abroad Major Concerns • Heavy emphasis on low prices and store promotions • Surge in online sales • Growing popularity of gift certificates • Better sales for luxuries in some markets Major Developments 6

  8. Germany – Sales to Increase by 2% Consumer electronics • Flat-screen TVs, DVD players, digital music players, digital cameras, GPS navigation systems Spending in advance of a 3-point VAT hike • Video games, educational toys, board games, model trains, plush toys, doll sets Toys Other gifts • Jewellery and watches Clothing • Sales dragged down by mild temperatures 7

  9. France and Italy – Higher Sales Than Last Year Especially in France Better mood to spend during this holiday season France Italy • Consumer electronics • Video games • Jewellery and timepieces • Consumer electronics • Video games • Clothing 8

  10. UK – Sales to Increase 3-4% Electronic gadgets • Flat-panel TVs • Digital music players • Mobile phones • Home cinema products • Lap top computers Low unemployment and firming house prices to support spending Toys • Video games, educational toys, classic toys Clothing • Sales boosted by deep discounts Other favoured gifts • Jewellery and watches 9

  11. Japan – Consumers More Willing to Spend Confidence spurred by rising winter bonuses and better job prospects Consumer electronics • Flat-screen TVs and digital music players much sought after Toys • Video games a popular buy Clothing • Demand hampered by warm weather Jewellery and watches • Sales facilitated by appetite for luxuries 10

  12. Chinese Mainland – Encouraging Year-end Sales Retail sales remained strong despite tightening measures Contributing factors Favoured gift items • Economic fundamentals remained sound • Appreciation of RMB • Growing popularity of Christmas • Increasing Christmas sales promotions • Most consumer products including consumer electronics, toys, garments, timepieces and jewellery 11

  13. utlook for 2007 12

  14. US – Consumer Spending to Cool Slightly • Sustained consolidation of housing market Economy to ease back into a lower gear • Consumers to remain prudent • Sustained popularity of mass merchandisers and discounters • But higher-income consumers to continue spending spree • Hong Kong exporters to adjust their product strategies 13

  15. EU – Consumption to Remain Stable • Rising interest rates More moderate pace of economic expansion • Fiscal deficit reduction • Consumers to remain conservative • Value-for-money preferred but quality still sought after • Strong euro facilitating imports 14

  16. EU – Varied Performances • Relatively low joblessness • Favourable housing market UK Varied prospects for different markets • Slowing exports • VAT rise for 2007 Germany • Slowing exports • Deficit reduction measures Italy • Sustained job creation and income growth France 15

  17. Japan – Consumer Spending to Expand Steadily • Moderating exports Continued but tepid economic revival • An end to zero-interest-rate policy and expected tightening of fiscal policy • Sustained improvement in labour market and wages • Adherence to value-for-money but growing demand for higher-end products • Stable yen facilitating imports 16

  18. Chinese Mainland – Healthy Spending to Take Hold • Government policies such as introduction of minimum wages, salary reform for civil servants, expansion of rural consumption and increases in welfare expenditure Increased consumer spending a priority for 2007 • Rapid urbanisation and growth of middle class • CEPA III to provide sales opportunities • Shift in consumption on sophisticated consumer goods • Increasing mainland customers to shop in Hong Kong 17

  19. Hong Kong’s Exports Expected to Grow 6%in 2007 18

  20. Have a Prosperous 2007! 19