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20 Jun 2017

Younger Consumers Help to Push Growth for Notebooks During JD’s 6.18 Sale in China, IDC Reports

SINGAPORE, June 21st, 2017 – The "6.18" event is an annual sale held on 18 June to celebrate Jing Dong's (JD) anniversary in China. In the days leading up to 18 June, JD as well as other major eTailers such as Alibaba’s Tmall.com usually follows suit to hold promotions to compete with JD. The eTailer sales data mentioned in this PR refers to the products sold between 1-18 June 2017 during the 6.18 sale.

This year’s highlight includes:

Growth of 16-25 age group. This age group posted the largest increase vs last year in terms of notebooks purchase, and made up 29.6% of the overall consumers who purchased notebooks compared to 21.6% last year. The decline can be seen in consumers in the 36-45 age group, which declined from 28.8% last year to reach 20.5% this year. The eTailers’ strategy of promoting their products by featuring celebrities in the livestreaming videos also resonated more strongly with the young. The ≤20mm notebooks and gaming notebooks saw a good YoY growth of 93.5% and 43.7% respectively in the market, largely due to the demand for consumer upgrades, and these products are also more attractive to the younger generation. Vendors can think of how they can come up with products to target those in the older age group.

Tapering growth in developed provinces. The growth rates for notebooks in the more developed provinces such as Guangdong, Beijing, Shanghai, Zhejiang, Fujian, Anhui and XiZang are now lower than the average growth rate in the whole of China. In particular, Anhui which saw a YoY growth rate of 5.4%, had the lowest growth rates in the whole of China. Similarly, for desktops, the growth rates in Beijing and Shanghai are subdued. This shows that growth in the PC market has become stabilized in the more developed cities. From the chart below, we can see that the provinces with the highest growth rates were Xinjiang, QingHai, JiangXi, HeNan and HeiLongJiang.

AI powering personalized options/choices. eTailers are more focused on providing personalized recommendations for consumers with their increasingly sophisticated algorithms through the use of big data and artificial intelligence. JD has also introduced an online virtual assistant to aggressively recommend relevant items to consumers based on their purchase history.

“Using different strategies to target the various high growth segments of the market would be advantageous to both eTailers and vendors. Price reductions alone are no longer sufficient to drive growth during these sales. Having specific devices with different price points targeting the different areas and segments of the market would be even more crucial in the coming years with the market slowing down in China, says Tay Xiaohan, Research Manager with IDC Asia/Pacific’s Client Devices Team.

Tay adds, “There is an increasing number of non-Chinese brands from overseas markets that have started to bring in their products to China through players such as Tmall and JD. They should work in hand with these eTailers and leverage on the mast amount of data that they have on consumer purchasing behavior to carefully plan how they can strategically reach out to their target consumers.”

Other detailed information can be found below:

Sales numbers for notebooks, desktops and printers

• 610,931 units of notebooks were sold in the eTailer channel and this was a 37.9% increase compared to the same period last year. 182,475 units of desktops (excluding DIY) were sold, and this was a 43.4% YoY increase.

• For JD alone, the sale of notebooks increased 38% YoY and desktops (excluding DIY) increased by 44.2% YoY, and these products were crucial in helping to push PC sales in the eTailer market. Notebooks sold through JD made up 83.8% of the overall eTailer sales numbers, and desktops sold through JD made up 94% of the overall eTailer sales numbers.

• Printers (including single function printers, laser multifunction peripherals (non-copier base), inkjet single function printer and inkjet multi-function printer) also saw good growth in the market, where it had a YoY growth of 41.9%. Printers sold through JD made up 70.1% of the overall market. The inkjet printer which was popular amongst families saw high sales number in the market, where it grew 53.3 % YoY.

• For Inkjet Printers, Canon continued to top the eTailer market, whereas HP Inc and Epson were at the second and third position respectively. For Laser Printers, HP Inc maintained its top position in the market and had a market share of 59%. After Lenovo’s Printing Unit was separated from Lenovo Group, it has been more aggressive in the online channel and this helped Lenovo to see a YoY increase in terms of its eTailer sales. Brother, Fuji Xerox and Canon were at the third to fifth position in the market.



• Compared to last year, the top five vendors during this same sale period for notebooks did not change. This shows that the top vendors continued to have a strong marketing strategy during this sale. The top vendor continues to be Lenovo (including ThinkPad).

• According to IDC’s numbers, the sale of ≤20mm notebooks has almost doubled compared to last year with a YoY growth of 93.5%. Gaming notebooks has also increased by 43.7% YoY and this helped to increase the overall ASP of notebooks. In 2017Q1, based on IDC’s data, the ASPs of notebooks has increased by 14.9% compared to that in 2016Q1, and during the 6.18 sale, notebooks in the >US$730 price band increased by 110.5% YoY and made up 48.1% of the overall notebook market. Consumers’ demand for notebooks with better designs and specifications has helped to push the ≤20mm notebooks and gaming notebook market.

• Other than consumers seeking for notebooks with better specifications, there is also an increasing need for students to purchase notebooks to complete their homework, as well as working adults to own notebooks for external discussions.

*Note: The numbers for JD includes both JD's online store and as well as third-party sellers who have an online store on JD's site.

For inquiries on this tracker research, please contact Xiaohan Tay xtay@idc.com. For media inquiries, please contact Tessa Rago trago@idc.com or Alvin Afuang aafuang@idc.com.

- Ends -

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Contact
For more information, contact:

Theresa Rago
trago@idc.com
+65 91593053

Xiaohan Tay
xtay@idc.com
+65 6829 7760

Alvin Afuang
aafuang@idc.com
+63917 7974586