Monitors see business boom

Sandra Bayly: Larger-screen and high-spec monitors sell especially well through business channels.

While the retail market continues to focus on mobile PCs, 2008 has seen particularly strong sales of deskbound PCs and LCD monitors through the business channels.

Based on year-to-date figures to April 2008, the business market increased its volumes of desk PCs and LCD monitors, 21 per cent for monitors, compared with January to April 2007.

This growth continues to erode retail share in volume and value. For both desk PCs and LCD monitors, business sales have dominated the market this year.

Although LCD monitor sales through mass merchandisers are slightly up for 2008 on 2007, the strongest growing
channels are still IT mail order, with a volume growth of 29 per cent, and IT resellers, with sales up by 13 per cent.

Widescreen continues to be the format of choice, enjoying the lion’s share of growth since summer 2006.
Although these monitors account for 79 per cent volume and 83 per cent value sales of the retail market in the year to April 2008, the business channels still rely heavily on the traditional screen format that account for 76 per cent of sales.

In the widescreen LCD monitor market, 40 per cent of the business channel and 49 per cent of retail channel sales were taken up by 19in screens in January to April 2008.

In both markets in 2008, 22in, 23in and 24in monitors have contributed most to the growth of the overall LCD monitor market.

However, larger-screen and high-spec monitors sold especially well through the business channels where 23in or larger
products accounted for 10 per cent of volume and 21 per cent of value share in the year to April 2008 compared to five per cent and nine per cent in the retail market.

One factor is that promotional activities have driven down prices of widescreen monitors, particularly 22in models.
The average sale price of a 22in wide-screen LCD monitor was £173 in April this year and the best-seller within
the business channels came in at a price of £163.

Volume sales of the total 4:3 LCD monitor market dropped 30 per cent from January to April 2008 on 2007; however, this decline was exclusively driven by the retail channels while sales in the business channels remained stable. The 17in still leads the 4:3 monitor in 2008, closely followed by sales of 19in screens.

Due to a high proportion of competition in the retail market, the average selling price (ASP) of a 17in 4:3 LCD monitor was £103 in April 2008 in retail, about £10 cheaper than via business channels.

The price gap for a 19in screen was even wider ­ with retail achieving an ASP of £121 and business an ASP of just £146.

There is opportunity for increased LCD monitor sales in the business channels, especially in the 17in and 19in 4:3 screen and the larger widescreen sector.

Sandra Bayly is an analyst at GfK.