Christmas PC sales stable but not spectacular

IDC says Christmas period was in line with the performance of the retail market in Q3 - essentially flat.

PC sales over Christmas were stable, but not spectacular.

Compaq sales director Andrew Seerden says Christmas sales were strong -— from a “sell-in” point of view — into the reseller channel.

“Retailers have been saying it’s been relatively flat year on year and also that it’s taken off later than the year before, and that’s been a trend for the past three years.”

HP consumer business unit manager Mike Carden of Auckland says Christmas sales were strong, with lower interest rates before Christmas stimulating a reasonable demand. He says Christmas sales were up by about 30% on 1997. However, he says there were other periods — such as around July 1998 — which were stronger than the 1998 Christmas period. That was surprising but he puts it down to concern over what effect exchange rates would have on PC prices. He says HP noticed “exaggerated seasonality” all year. “The back-to-school period was incredibly strong.” He says HP suspected Christmas might follow the same pattern, but instead it was in line with the original forecast.

He says the sales channel matured a lot in 1998. “From a brand point of view you had a lot of activity from the Harvey Normans and the Noel Leemings, which are really going hammer and tongs at it.” Carden also says there was a lot more mainstream PC advertising.

IDC New Zealand general manager Dinesh Kumar says the early feedback is that Christmas was a bit soft for the retail segment, and below expectations. The Christmas period was in line with the performance of the retail market in Q3 — essentially flat. “But it seems the government market and the smaller SME [small to medium-sized businesses] market did better than expected.” He says that 1998 as a whole seemed to perform better than expected.

Ross Allan, general manager of Dell New Zealand, says Dell is less affected by the Christmas market because of its concentration on the corporate market. “We did some very good business in November and December corporately, and I’m expecting January to be a very strong as well.” He says the Asian crisis was positive in terms of manufacturing and production costs.

A director of Christchurch-based Green PC Company, Rob Fasher, says growth in 1998 was stable compared to the big growth the company experienced in the previous two years. He says there is always a drop-off in demand between September and November. “But it was a lot more severe last year. That’s consistent with the government announcing that the country — three months prior — had officially been in recession.”

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