Consumers cut spending on big-ticket items during the recession, hampering TV sales.
Los Angeles, CA (PRWEB) February 27, 2012
The Online Television Sales industry has grown substantially in the past five years as consumers have rapidly shifted toward shopping online. Every year, more than 100 million Americans purchase goods from the online retail marketplace, one of the fastest-growing industries in the United States. Furthermore, as traditional retailers (i.e. brick-and-mortar) have entered the online realm to recapture sales taken from retailers that sell exclusively online, industry revenue has only expanded. In the five years to 2012, IBISWorld estimates industry revenue will grow at an average annual rate of 10.1%. “This growth trend will continue as per capita disposable income increases and consumers become more confident in buying big-ticket items online,” says IBISWorld industry analyst Mary Nanfelt.
Although Online Television Sales industry revenue has grown substantially in the past five years, online TV retailers have faced some challenges. A drop in per capita disposable income caused revenue growth to slow in 2009 as many Americans refrained from purchasing expensive discretionary goods. In addition, Nanfelt says the industry continues to face external competition from brick-and-mortar stores that provide customers with product advice in person as well as from electronic devices, such as computers and tablets, that can stream TV content. Despite these challenges, profit has continued to grow because of stronger supply chains and expanding economies of scale for online TV retailers, especially major players Amazon.com, Best Buy, Newegg and Systemax. The online TV sales industry has a moderate level of market share concentration since small companies make up a large share of the market. It is not very costly to start an online store, and minimal skills are required.
The industry will continue to thrive in the next five years as disposable income continues to expand and online retailers expand their customer service capabilities and free shipping promotions. Many of the same factors that contributed to the industry's ascent in previous years will carry forward over the next five, including the rising acceptance of online shopping. The industry will face a looming threat of regulation regarding sales tax, though, and a change in regulation could reduce industry profit in the coming years. For more information, visit IBISWorld’s Online Television Sales report in the US industry page.
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IBISWorld industry Report Key Topics
This industry retails TV sets via the internet. Industry goods are typically purchased from domestic (in some cases international) manufacturers and wholesalers, and then sold to the public online.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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