Market Report 2023 Executive Summary

2023 Market Report: Executive Summary

The Australian music products market had a difficult year in 2023, with a drop from 2022 of 19% in units, 14% in value. The overall trend in many cases looks like a continuing decline from the peak of the pandemic years.

Economic snapshot

2023

2022

GDP Growthi

   Year-ended

Year-average

1.5%

2.0%

2.75%

3.75%

Unemployment Rateii

3.8%

3.5%

Cash Rate Targetiii

Lowest

Highest

3.35% (Feb)

4.35% (Dec)

0.1% (Jan)

3.10% (Dec)

Wage Price Indexiv

4.2%

3.3%

Populationv

26.82m

26.16 m

Consumer Price Indexvi

4.1%

7.8%

For context, interest rates are high and retail sales in Australia declined throughout 2023, there are challenging times for the live music industry which have been widely discussed in the context of a Parliamentary Inquiry and several prominent festival and venue closures, and a recent report by Creative Australia finding that the workforce for professional musicians has fallen to the lowest level (numberically, and as a proportion of the labour force) since it began recording the workforce in the early 1980s. The report on participation in the arts released in 2023, however, found that participation in music is stable in the post-pandemic report, the proportion of the population playing a musical instrument remaining unchanged (at 10%) since the previous report.

Of the main categories in the report, the only one with any real growth in units was Other Wind (32%), although the recorders and miscellaneous instruments included here make it fairly unique, and this was probably correcting a lower than usual result in 2022. Several others had modest growth (Synthesizers 3%, Orchestral Strings 3%, Wireless Microphones 2%) while all others declined, including 17 categories by more than 20%.

Looking at value, overall there was decline for the whole market (as mentioned, -14%) and sections for DJ & Electronic Products (-26%), Guitars (-24%), Pro Audio (-11%), Pianos & Keyboards (-10%), Brass, Wind & Strings (-6%), and Percussion (-4%). Only the Accessories section increased in value, by 3%. There were however more categories with higher total value than the previous year, including Wireless Microphones (37%), Microphone Parts & Accessories (26%), Unpowered Mixers (25%), Orchestral Stringed Instruments (5%), Strings for those and other (non-guitar) instruments (3%), as well as Cymbals, Microphones, Powered Mixers and Grand Pianos with an increase of 3% or less.

Using a different measure for comparison, the news is not all bad and we can see this year’s results in the context of the 2-3 preceding years. Comparing 2023 to 2022, 11 of the categories showed an increase in total value (an average of 9%); comparing 2023 to the average of the past five years, 18 categories showed an increase (an average of +3%; a further 5 categories exactly matched the 5 year average); comparing 2023 to 2019, 25 categories showed an increase (an average of 20% increase). In other words, there has been growth since the last pre-pandemic year (2019) but overall, in most sections, and in most categories there was a decline from 2022 to 2023 in terms of units and value.

Pianos & Keyboards

The total number of units (Grand and Upright Pianos, Digital Pianos, Keyboards, Organs) was the lowest since 2015 although value was the second highest result in the 10 years of this report. Grand Pianos were the most consistent from 2022 to 2023, with most of the decline coming from Digital Pianos and Electronic Keyboards. Interestingly, Synthesizers which fall into a different section of the report did increase by 3% in units.

Guitars

The overall picture for the Guitars section in 2023 (including electric, bass and acoustic guitars, amps, ukuleles, strings) is not good, with a 28% decline in units and 24% decline in value. Unlike many other areas where a lower result in 2023 is a result of stronger than usual figures in the previous year or two, there are even bigger drops in units when comparing to the 5 year average (-33%) and 10 year average (-32%). Excluding the past two years and looking at the Section as a whole, the result is mixed: units are the lowest in 10 years, but value is almost on par with 2020 which was a strong result and an almost $AU17 million increase on 2019. The trend overall and in several categories is of decreasing units but increasing average values leading to increasing total value. The Total Value for the Section in 2023 is still a drop from 2022, but could be a correction after two strong years.

2023 was the third lowest year for Acoustic Guitar units in a decade, continuing the two year decline from the ‘pandemic peak’. Units were down from Indonesia in particular, and a spike in the previous year of Spanish imports fell away in 2023. Of the main Categories in the Guitar Section, Acoustic Guitars (-36%) and Bass Guitars (-41%) had the largest drop in units.

Brass, Wind and Strings

Brass, Wind and Orchestral Stringed Instruments as a whole are closer to 2021 than 2022, which had lower units and higher value. The section as a whole did increase in terms of units by 18%, but the low value ‘Other Wind’ (recorders etc) category skewed this result and all other brass and wind instruments declined.

Percussion

Like other parts of the report there was a decline in 2023 across all four of the categories, but this section is more stable than most, with $AU16 million in import value only 4% lower than the previous year, and comfortably above the $AU14 million in 2019 and 2020. Some good news for percussion imports this year is the Australian Government removing ‘nuisance tariffs’ on these products.

Electronic Instruments

The ‘DJ & Electronic Instruments’ Section is almost a miscellaneous category, with little linking the electronic drums and turntables, so the overall analysis of these together is less useful than in other sections. However, it can be said that the main decline is due to Turntables, not Synthesizers which are relatively stable.

The ‘other’ electronic instruments category, mostly drums, fell by more than 20% in terms of units and value, although total value almost matched the 5 year average. There was a similar but smaller decrease in units and value for acoustic Drum Kits at the same time. Synthesisers increased slightly in units but lower average values brought the total value to 8% below the 2022 result.

Pro Audio

The overall drop in the Pro Audio section was 11% in value, noticeably lower ($AU25 million) than 2022, but moved less dramatically than other parts of this report. Last year’s drop in units from a peak in 2021 has been continued with a further 17% drop, but with a longer term perspective there is still an increase (6%) on the 10 year average. The increase in value over the 10 year average is even greater (43%). For the first time since 2018, Unpowered Mixers overtook Microphones with the highest total value.

The average cost of loudspeakers doubled, with a 58% drop in units and only 15% drop in total value. Microphones also increased substantially in average value (43%) and fell in units (-30%) but the total value for this category was almost unchanged from 2022, and the 5 year average. The change for Wireless Microphones was in the same direction but less pronounced, with a comparatively modest 8% drop in units and 14% increase in total value causing a 24% increase in average unit value.

Power Amplifiers dropped in both units and value compared to 2022, this category shows a reasonable increase in value compared to the 5 year average (8%) and 10 year averageg (24%) but units are down across all comparisons. This category shows the opposite trend to many other categories, such as microphones and guitars, which increased during the pandemic but fell since then.

Mixers (powered and unpowered, combined) shows an upward trend over time, notwithstanding the spike in 2020, but units were slightly lower than in 2022 (9%). Although Signal Processors showed a higher value than the 5 and 10 year averages, by all measures 2023 was lower than the highly unusual previous year, with value dropping by more than 50%. There is no obvious explanation in the data for the spike in 2022 but the 2023 result looks like a return to ‘normal’.

Accessories

Accessories as a whole have increased in value since 2022 (3%), even more so compared to the 5 year average (9%) and more again compared to the 10 year average (40%). Data for accessories are limited by only having access to value (not units), and the wide range of different products within some of these categories, but the general impression of accessories is positive. Given that accessories are an opportunity for all retailers, and indicate ongoing use of musical equipment even when instrument sales are lower, the accessories data are somewhat reassuring.

Non-Guitar Strings (for bowed stringed instruments etc) are very close to both the previous year (+4%) and 5 year average (0%), but Guitar & Bass Strings were 9% below 2022. It would have been encouraging to see this higher given the large spike in guitar sales in recent years. There is some comfort however in the longer term comparisons, with Guitar & Bass Strings in 2023 (value) being 2% above the 5 year average and 15% above the 10 year average.

Metronomes and other Parts and Accessories increased (9%), while Piano Parts & Accessories fell 7% but stayed almost level with the 5 year average (0%), Electric Instrument Parts & Accessories fell substantially (-23%) but looks like a return to pre-pandemic ‘normal’ after several years of higher imports. The strongest increase in the Accessories section was Microphone Parts & Accessories, with a 26% increase in total value, although this was due to higher average values (units dropped, and this is the only accessories code where we see units).

Unlike 2022, when the value of imports from China reduced and all other regions increased (North America, Europe, South East Asia, other East Asian countries), in 2023 there was a reduction from all regions other than Europevii.

What has changed

Last report marked a significant departure from the old Market Report. The methodology and presentation were revised from first principles, to produce an online report with more transparent analysis.

The 2023 report is very similar to that report, using the same approach with only a few changes. They include:

  • Two of the simplest ‘at a glance’ tables have been added to Section Summaries (Piano & Keyboards, Percussion, etc). These are in the same format as Tables 1 & 2 for each Category, showing 1) the change (in units, and value) from the report year to the previous year, 2) the same comparisons to the average of the last 5 years, 3) the same comparisons to the average of the last 10 years, 4) figures for each of the last 10 years, in units and value

  • More information about Accessories (tables were not provided for some codes, they are now available for all but one code)

  • The two speaker codes that are not used in Section totals (‘Amp Speakers’ and ‘Single Loudspeakers’) have pages with all tables, to provide the data for those that require it.

  • Table 2 is not included for Accessories where unit data are not available (ie. all except Microphone Parts & Accessories). The only information included here was Total Value over 10 years. Instead, Total Value has been added at the top of each column in Table 4.

  • The ‘Source of Imports’ data (Tables 8 & 9 in 10 Years At A Glance)

Example: Section Summary 'At A Glance' (Table 1)

How to use this report

I want to see broadly what happened in the market in a few minutes

I want to get an overview of the whole market, and specific categories

I want to see one collection of products only (eg. Guitars), and specific products within that

  • From the home page / sidebar, see the relevant Section page (eg. Guitars, Pianos & Keyboards)

  • From that Section page (eg. Guitars), find the relevant Category (eg. Electric Guitars)

I want to determine our market share for particular product categories

  • From the home page / sidebar, find the relevant page/s, see Tables 3 & 4 in particular.

  • If necessary, download the data (click ‘Get the data’ on any table)

I want to see how our orders compare to the market as a whole

  • From the menu, find the relevant page/s

  • See Table 5, showing 1) units imported, each quarter, for that category, showing the trend throughout the year (for example, some are typically higher in the March & December quarters); 2) how the most recent year (red) compares to the average of the past 10 years (black) and all other years

  • Download the data to see all periods (in units) for that product category only

  • nb. Accessories categories use ‘value’ because units are not available.

I want to compare our sales in various categories to the market as a whole

  • Go to Tidy Data and download a .csv file showing Period (Quarter), Category name, Units, and Value for the past 11 years, all categories in the report, and analyse the data in your own way.

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References

iReserve Bank of Australia. Economic Outlook (February 2023) https://www.rba.gov.au/publications/smp/2023/feb/economic-outlook.html

iiAustralian Bureau of Statistics. Labour Force, Australia (Reference period: 2013-2023). https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia/latest-release

iiiReserve Bank of Australia. Cash Rate Target (reference: 2023). https://www.rba.gov.au/statistics/cash-rate/

ivAustralian Bureau of Statistics. Wage Price Index, Australia (Reference period: December 2022, Annual %). https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/latest-release

vAustralian Bureau of Statistics. National, State and Territory Population (reference period September 2023). Note: Previous reports used the December figure, this report is released earlier and uses the most recent figure available, which is September. https://www.abs.gov.au/statistics/people/population/national-state-and-territory-population/latest-release

vi Australian Bureau of Statistics. Consumer Price Index, Australia (Reference period: December 2022). https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release

viiRegions are chosen for the purpose of simplicity in presenting the source of imports. Japan, Hong Kong, Taiwan and South Korea are grouped as East Asian countries except China, other regions are based on trading blocs, China is the biggest individual source of imports and stands alone as a category. See 10 Years At A Glance https://australianmusic.asn.au/market-report/at-a-glance/