Electronics giants pin their hopes on flat screens

Wall to wall televisions were on show to attract dealers' attention (swissinfo)

The big players in the Swiss consumer electronics industry have been pushing their new products amid hopes that 2003 could mark an upswing in the market.

Dealers have been looking at what consumers might be tempted to buy in future, with a particular eye on the Christmas season.

High above Lake Lucerne, at the Swiss Holiday Park in Morschach, some 2,000 dealers were given an insight into the products expected to take off in the next months and years.

The show comes just a week after the branch’s elite met in Berlin at the world’s largest consumer electronics fair called IFA.

Although Switzerland is not a huge electronics market, it is highly regarded within the industry because consumers are quick off the mark.

Spending power

“The Swiss have enough money to buy new technologies. It’s very important to see how the Swiss people react when new products are on the market,” Sony’s communications coordinator Sevgi Gezici told swissinfo.

“We always have the new products [ready] very fast because we are one or two years ahead of other countries like Germany or France,” she added.

Swiss JVC product manager Heinz Häner agrees that Switzerland is a key testing ground.

“Traditionally, Switzerland is one of the test markets and it’s still the case. It’s a market that enables you to sell high quality products at a higher price,” he told swissinfo.

For Philips marketing manager, Claudio Magnabosco, the Swiss market is valuable because consumers have both high incomes and high expectations.

Demanding customers

“The Swiss are quite demanding. They want to have the newest products and they spend a lot of money on new technologies. Therefore, Switzerland is a leading market, especially for very new inventions and new products,” he said.

But the harsh reality is that over the past few years, Swiss consumers have been keeping their money in their pockets; hardly surprising, perhaps, against a background of economic uncertainty worldwide.

“Today, the whole Swiss consumer electronics market is worth about SFr1.4 billion. Actually, it’s a very tough market because in the current economic circumstances people think twice before buying an expensive toy or device,” commented Christian Hermle from John Lay Electronics, the Swiss distributor for Panasonic and Technics products.

“The Swiss market has been decreasing for three years… so this is one of the big challenges for everyone who is in this market,” he added.

Up in Morschach, there were clearly products that enticed the dealers and will also attract consumers at Christmas and beyond.

New trends

“I feel there are two main trends. One is on flat TVs. People want to have slim, flat, wide screen TVs. They are becoming more and more affordable and the technologies are improving very much,” explained Magnabosco from Philips.

“The other trend is going towards wireless applications – the connected house – where you can access any kind of information from every point in the house and even get content from the Internet to any point in your house,” he added.

The television market accounts for about a third of all consumer electronics spending in Switzerland and it looks set to stay that way.

“There are two technologies. In the smaller sizes up to 36 or 37 inches it is LCD and in the higher sizes, it’s plasma,” explained John Lay’s Hermle. “This is one of the big markets of the future. The value right now is ten per cent of the whole market in Switzerland. In Europe, it’s three to five per cent overall.”

And he is not alone in forecasting that DVD recorders will account for a major share of the market in the future. He points out that Panasonic has a machine with a hard disc capable of recording more than 100 hours of programmes.

Apart from televisions and DVD recorders, the Morschach show also featured a host of other products looking for a home, for example camcorders, mini disc players, digital cameras and even a CD player that DJs can use instead of a conventional turntable to “scratch” the sound they want.

Then there were portable mp3 players you can hang around your neck, with controls integrated on the neckband, and an impressive 15-gigabyte audio juke box – a pocket-sized device with enough capacity to store more than 3,000 songs.

Cautious optimism

Häner at JVC believes that better times for the branch might not be far away, although he remains cautious.

“We have a feeling, but we don’t really know, that coming out of LCD, DVD recording and plasma, the dealers’ mood is much better for the next month, which allows us to believe that business will start to go up now,” he said.

Magnabosco at Philips predicts that the branch is going to enjoy a “good Christmas”. “The dealers are very enthusiastic about the new products,” he said.

There are plenty of people in Switzerland who argue that consumer prices in Switzerland are up to 30 per cent higher compared with in neighbouring countries.

But John Lay’s Hermle maintains that in consumer electronics, the pricing is on a par with other countries.

“Two years ago, it was a big topic in the media and we checked our ranges and prices of products with the prices in Germany, for example, which is one of the most relevant markets,” he said.

“We can say that almost 95 per cent of the products have the same price. Today, you have unified pricing systems within Europe. If we didn’t, the dealers would go to France or Italy and purchase the products there,” he said.

swissinfo, Robert Brookes in Morschach

Key facts

The Swiss consumer market is worth about SFr1.4 billion ($1 billion).
Television sets account for about a third of the total spending.

In brief

The big five in Switzerland– Sony, Panasonic, Philips, JVC and Pioneer – have just held an exhibition for dealers at Morschach in central Switzerland.

The trends seem to be for flat televisions, DVD recorders and wireless applications.

There is cautious optimism that 2003 could mark an upswing in the Swiss marketplace.