Growing Demand of Headphones Causing Prices to Fall: GFK

  • Between January and June 2019, GfK recorded total sales of €7.9 billion for the global audio devices market
  • Western Europe is the largest market, followed by China and the Developed Asian countries

In the first half year 2019, in-ear headphones saw a steady sales value growth of 55 per cent and accounted with a sales volume of nearly €3 billion for 70 per cent of the total headphone turnover. China by far is the largest market, followed by the Western European and Developed Asian countries. Almost 50 percent of all wireless in-ear devices sold in 2019 were true wireless ones (with two separate earpieces).

A recent report by GFK read, “The global market for these headphones grew by almost 300 percent from 2018 to 2019. This high consumer demand has attracted the attention of more and more brands so the number of manufacturers shot up by a factor of three in the first half of 2019. This caused the average sales price to drop considerably to 85 EUR.”

Global markets

Sales of over-ear headphones grew by 11 per cent. Western Europe is the largest market, followed by China and the Developed Asian countries. The LATAM region is at a lower absolute level but has been catching up recently, with a growth rate of almost 80 per cent for Bluetooth over-ear headphones. These devices that wirelessly connect the headphones to the music source witnessed considerable turnover growth and are becoming the worldwide standard, with a market share of close to 80 per cent for over-ear headphones.

Just as for true-wireless in-ear headphones, more players are entering the market, increasing pressure on price. In the first half year of 2019, Bluetooth over-ear headphones on average were sold for 90 EUR. The comparison to true wireless for in ear-headphones is active noise cancelling technology for over-ear headphones, whose turnover grew by 40 percent.

Sales of €7.9 billion for the global audio devices market

Between January and June 2019, GfK recorded total sales of €7.9 billion for the global audio devices market, excl. North America. Compared to the first half of 2018, this is an increase of 15 per cent. Headphones and headsets are the key driver of growth, together with portable Bluetooth speakers and loudspeakers for the home. There is plenty of growth potential in smart devices with embedded voice assistants and in loudspeakers to enhance the entertainment sound at home. These are GfK’s findings for the global audio market to be released at IFA 2019 in Berlin.

GFK’s report read, “Global audio markets have the opportunity to prolong their growth trajectory, experiencing positive results almost uniformly around the globe. Largest contributors are the CIS* countries with a 41 percent increase and China up 38 percent. Headphones/headsets remained the highest turnover segment, followed by Bluetooth speakers, audio home systems and loudspeakers.”

Increasing focus on sound quality and investment in soundbars

GfK’s consumer data suggests that people are in general very happy with the image quality on their newly purchased TV, sound quality scores below-average on the sentiment score. This creates an opportunity for external speaker systems. So, while on the one hand consumers are spending less on their TV sets and average sales prices are decreasing, on the other, they are increasingly conscious about sound quality and are spending that saved budget on soundbars. As a result, the turnover for soundbars has been increasing year-on-year, and in 2019 it rose by a further 7 percent. Single-sold soundbars contributed with an increase of 13 per cent and wireless subwoofers grew by 5 per cent.

Almost one quarter of global audio sales value originates online

In the first six months of 2019, a total of 41 percent of the global audio sales value came from online sales, compared to 36 percent in the same period last year. In contrast to other categories, the increasing online importance does not influence the demand peaks throughout the year. Being a classical gifting category, the audio sales peak is still around Christmas time, rather than in November or during other online retailer events like Black Friday.