China’s Outdoor LED Display Industry Developments

For LED outdoor display manufacturers in the lower rung of the industry competitiveness will be supported by three cores: their ability to obtain resources, innovative technology and creative strategy. The extent of control and balance over these three resources will decide whether they will have the ability to construct competitive technological barriers, according to a report by Chinese-language online media CIEN.

LEDs are no longer strange innovative products to the general public, and are everywhere these days. LED displays has permeated everyday life and can be seen in almost all public spaces, whether in markets, subway stations, train stations and even at concerts. All these public spaces will have one or several LED displays that broadcast different types of video content.

After several years of rapid developments, the LED display industry has entered a period of integration, and has been unable to maintain popularity as the LED lighting industry. During the integration phase, LED display manufacturers that have technological and capital strengths hope to use the market’s strength and manufacturer’s technology to acquire channel advantages and develop quickly. Some Small and Medium Enterprises (SME) are gradually being eliminated or integrated. The concentration rate of the LED display industry is expected to rise.

In 2012, annual LED display prices were lowered by 15 to 20 percent. The price falls were mostly caused by LED display manufacturers price competitions. LED display sales have soared as prices continued to drop, leading to manufacturers continual lowering of profits to raise market shares. Some analysts believe, current Chinese LED display industry’s competition is still in the early stage of product competition. Key competition indicators include prices, quality, production lead date and service after sales. The current stage has especially highlighted price factors. Hence, LED display manufacturers have been engaged in huge price wars. Skilled manufacturers are hoping to use price wars to eliminate some small-midsized manufacturers.

Outdoor display advertisement is an important market for LED display industry. According to statistics, China’s outdoor display ad market has reached RMB 2.48 billion (US$ 450 million) in 3Q13, and has a market share of 17.8 percent, an incremental improvement compared to 17.3% last quarter. The increased rate is partly due to decreased ad revenue and comprehensive regional market strategy, which has spurred 3Q13 market size increase. On the other hand, business areas operation and sales value were highlighted. LED display ads advantages in strengthening the public’s brand recognition and ad effect has been recognized by brand clients.

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