Consumer Electronics Business in the BRIC Countries

Introduction

The current trend in the business environment has seen many businesses adopt consumer electronics in their market activities since it has become an essential aspect of facilitating the success of the businesses. This is because the products have become useful in taking care of the usual everyday office tasks like electronic filing, phone services and many other tasks. This has made the demand for these products increase tremendously especially in the emerging markets which are mostly the BRIC countries like Brazil, Russia, India and China. As a result of the increase in demand in these countries, their GDP has been increasing after every decade. This has made any company intending to engage in the international market to consider seriously how to capture these emerging markets if the company has intentions of becoming a global market leader. Buy this excellently written paper or order a fresh one from acemyhomework.com

Consumer Electronics Business in the BRIC Countries

Brazil which appears to lead the BRIC countries defines its domestic consumer electronics devices market as the most appropriate for computing devices, mobile handsets and other electronic gaming products. With this market having an estimate of around US$30.2 billion during 2011 alone, the market has grown in a great way. The retailers of these products noted an increase in demand for consumer electronics compared to the previous years where for instance, the vendors of these products struggled to catch up with the increase (Bier 2011). In addition, the shipment of handsets recorded an increase which means that the demand was high. The other member in the BRIC countries is China. The consumer electronics device market in this country includes computing devices, video, audio gaming products and mobile handsets among others (Johansson & Leigh 2011).

The decision to introduce credit-cooling measures in Brazil which has caused a great effect on the private property market has not affected the positive results that have continued to be posited on consumer electronic market (Chua 2011). This is estimated to continue where the estimates for 2015 are likely to be US$43.6 billion. This is being facilitated by increase in the popularity of the digital lifestyle among the Brazilian population. In addition, the government’s decision to procure PCs and subsidize handset progams has been a contributing factor to this increase. This will see the Brazilian consumer electronics spending register an increase, a factor that has already began. For instance, in 2010, Brazilian computer hardware amounted to around 39 percent in the total consumer electronics spending. This was due to the increase in the sale of computer hardware which included notebooks and accessories among others (Business Monitor

International Ltd 2011a). This increase in the sale of notebooks and net books will also lead to increase in the sale of computer hardware CAGR to about 11.4 percent by 2015 according to the current predictions. The country’s estimate for PC ownership which was 29 percent by 2010 is estimated to rise to around 41 percent by 2015.

In China, the computer market amounted to 39 percent of the country’s consumer electronics spending in 2011. According to BMI estimates, the sales from domestic market hardware amounted to US$ 78.6 billion in 2012 (Business Monitor International 2011b).This was an increase from the previous year which was US$ 69.5 billion.

In Brazil, 34 percent of the country’s consumer electronics spending belonged to AV devices. By 2011, the country’s domestic AV device market was estimated to be US$ 10.4 billion. During the previous year, the events of the FIFA World Cup had boosted the sale of TV sets making the vendors of this product particularly those dealing with flat-screen sets registered enormous sales. In China the AV devices accounted to 39 percent of the total consumer electronics in 2011. The country’s domestic video and gaming device market is estimated to grow at a CAGR of 6.8 percent by 2016. The country is expected to experience high growth in LCD TV in 2012 due to high increase in preference for larger sizes of screens and TV sets that are internet-enabled (Business Monitor International 2011c).

India’s consumer electronics devices market is estimated to be about US$ 33.9 billion in 2012 and it is expected to rise to US$ 59.4 billion by 2016 (Business Monitor International 2011d). The main reason for the increase in these products is increase in incomes among the Indian population which has increased affordability. During the cricket world cup season, vendors in India reported an increase in consumer electronic devices (Higgins 2010). This is where the sales rose with around 50 percent when compared to the same period the previous year.

Mobile handsets are another product that contributed to Brazilian consumer electronics spending. This product accounted for 27 percent of all the total spending. The proposed changes are expected to increase the handset market to about US$ 9.9 billion by 2015 where the subscriber penetration is expected to be over 140 percent. This will be facilitated by production of more affordable smart phones which are a key focus for operators. It accounted up to 20 percent of all the handset sales during 2011 (Business Monitor International 2011a). Mobile handsets in China’s consumer electronics accounted to about 22 percent. The main cause of subscriber growth in the rural market is due to rapid expanding of 3G handset market and increase in smart phones which accounted to 20 percent sales of Chinese handset.

In China, the consumer electronics devices market which is at US$ 197.7 billion in 2012 is expected to rise to a high of US$ 281.5 billion by the year 2016. This growth will be realized due to economic recovery, rural subsidy programme and innovation of new products which has been experienced in the China market in the recent past. This is where the vendors have invented new technologies in order to increase their sales and manage the already mature demand in the large cities. Some of these technologies include LED TV sets and 3D TV sets which are estimated to comprise 50 percent and 10-20 percent respectively (Business Monitor International 2011d).

The other growth area for these products in China is in the area of smart phones where it has registered a double digit growth. The criteria employed by the government of rural consumer electronic subsidy programme will make the sale of flat-screen TV sets divide with the sale of other electronic products in the rural areas (Little 2008). Television sets remain an important product among the population of India due to sports events like ICC Cricket World Cup like the one that was held in 2011. This saw the LCD TV sets sales increase where they accounted to 80 percent of all the flat-panel television market. This was reported by the LED TV vendors who noted a strong growth in this segment.

According to BMI estimates, the Indian computer hardware sales accounted up to 32 percent of all the consumer electronics spending. This is where the total sales in these products amounted to US$ 10.8 billion during 2012. By 2016, the consumer electronics devices spending are expected to grow with over 15 percent. The Indian mobile handset sales accounted to about 31 percent of the country’s consumer electronics spending during 2011. With the country’s market handset sales being estimated to reach 316 million units by 2016, the vendors are likely to base their focus on semi urban rural customers in order to increase their sales. In this country the sale of smart phones is also likely to be a strong area of growth (Malar et al. 2011). This is particularly because both internal and the multinational vendors will be seeking high-end features at prices that are widely affordable among the country’s population.

The proposed criteria of making computer-based consumer electronics the main component of coming up with through utilization of commodity chips and software has become relevant in the BRIC countries (Business.com 2011). This has enabled these nations to experience increase in sales of their various products as a result of uniqueness of the products formed which ensures that the products are not easily pushed out of the market due to their high standards (Kocyigit & Ringle, 2011).

In conclusion, the BRIC countries success has been experienced due to adoption of advanced technology especially from the already developed markets. The changing norms and regulatory requirements have also contributed to high quality products that continue to be invented in these markets.

Reference List

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