Lower-priced and smaller screen models push up sales but at the expense of total value.
Tablets sales in Vietnam increased 34 per cent in the first five months of the year, according to the latest report from GfK.
Low-end and smaller screen models propelled the surge. The penetration of tablets deepens in Vietnam as more affordable models are introduced in the emerging market. Sales in the first five months stood at almost 582,000. GfK’s point of sales tracking reported around 149,000 more tablets being snapped up in January to May compared to the same period a year ago.
Revenue generated, in contrast, was down by 5 per cent due to the greater contribution from these lower-priced models. “More than three out of every four (76 per cent) tablets sold so far in 2015 cost less than $300, as compared to just 50 per cent in 2014, signifying a strong shift in market trends towards the low-end segment,” observed Mr. Tran Khoa Van, Managing Director of GfK in Vietnam. “This phenomenon of more media tablets being sold at lower prices has resulted in the shrinking of total market value.”
On the other hand, high-end tablets priced above $500, which accounted for 29 per cent of the total sales last year, were down by half, to just 14 per cent in the first five months of this year. A similar trend is seen in the $300-$500 segment, which had a 22 per cent share last year but has fallen to 11 per cent this year.
According to GfK’s findings, the average price of tablets declined by 30 per cent, from $367 last year to $259 this year. Meanwhile, the number of brands catering to the Vietnamese market fell from 56 to 49, but the remaining players introduced 20 more models, from 278 to 298.
Another emerging trend is the rising popularity of smaller screen tablets, specifically the 7.9” and below segment. Over seven in ten (71 per cent) tablets purchased this year were of this size, up from 62 per cent last year. On the other hand, the 9-10” segment reported a dwindling market share, by half, from 26 per cent to 13 per cent.
“Price erosion is a natural progression of a tech product’s life cycle and the average price of tablets will certainly be drifting down further from the low of $250 reported in the latest month of May,” said Mr. Van. “The tablet market is anticipated to achieve even higher sales in the third quarter of the year, with anticipated back-to-school promotions, and annual sales are estimated to hit 1.9 million for the year.”