The sectors hit hardest buy the COVID-19 pandemic this year, such as venues, hospitality and retail, are set to see some of the strongest recovery growth in 2021, Sean Wargo, senior director of market intelligence at AVIXA, has told Installation.
Earlier this week, a new report revealed that the pro AV and installation market is expected to decline by $20 billion to $239 billion this year, down from a peak of $259 billion in 2019. The report also indicates that the market will recover its pre-COVID levels in 2022, before growing to $315 billion in 2025.
Among the most heavily affected sectors are the hospitality, retail and events channels, with businesses the world over being forced to close for business or make significant staff cuts. Among those forced into making such cuts is Sennheiser, which announced this month that it would be laying off around 650 staff over the next 18 months as a result of the challenging market conditions.
However, speaking to Installation, Wargo suggests that as the market eventually recovers, that hardest hit markets will likely see the most rapid recoveries.
“Hospitality, venues, and retail will be the hardest hit vertical markets this year, but fortunately, they will also see some of the strongest recovery growth in 2021,” he said. “Most of the pervading outlook places a meaningful return to activity in those markets in early 2021 as we get treatments and vaccines and consumers once again feel more confident to resume. After a year of steep declines, this return to activity thus brings higher rates of growth. That said, it will be a while before we get back to previous levels for those markets, hence our forecast for our industry to set a new peak in 2022.”
As for the most resilient markets, Wargo transport, energy and media as being in the strongest position to weather the current conditions.
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“These are favorable markets,” he continued. “They incurred modest contraction in 2020 and will have strong growth in 2021. You will see transportation hubs making investments in pro AV, in order to help communicate health and safety protocols to travelers and staff. The energy and utility business will generate high growth thanks to investments in smart grid and sustainable energy sources. The media & entertainment vertical is soaring due to the large demand for digital entertainment and business content. Digital consumption, from mobile apps to TV and gaming, gives rise to the sales of storage, and distribution equipment, software and services.”
While the industry may have to wait until 2022 before reaching its pre-pandemic heights, Wargo expects the market to reach $255 billion in 2021 – up significantly from $239 billion this year.