Product innovation and competitive pricing are key factors for success
The rapid proliferation of smart phones and tablets has caused the global magnetic sensors market to boom. This growth curve will continue as declining price points make magnetic sensors affordable for mass-market penetration.
New analysis from Frost & Sullivan, Analysis of the Global Magnetic Sensors Market, finds that the market earned revenues of €1.20 billion (US$1.66b) in 2012 and estimates this to reach €2.56 billion (US$3.51b) in 2019. The study also outlines the prospective areas of growth globally, end user- and application-wise.
With navigation emerging as a must-have feature in smartphones and cellular handsets, the need for digital compasses has spurred the global magnetic sensors market.
“Moreover, the mandatory fitment of magnetic sensors in vehicles due to regulations from the automotive sector has fuelled sale volumes,” said Frost & Sullivan Measurement and Instrumentation Senior Industry Analyst V Sankaranarayanan. “Opportunities for magnetic sensor vendors in the automotive industry will continue to open up as new applications emerge.”
However, this immense potential may not translate into equivalent revenues as intense competition leads to pricing pressures. Manufacturers are reducing prices to penetrate markets such as consumer electronics, where a compelling price point is crucial for success. Profits are also affected as automotive manufacturers apply downward price pressure on sensor manufacturers.
To counter these challenges, innovative product differentiation strategies are necessary. Products must move from competing purely on price to non-price factors, especially as customers look for unique solutions with tangible benefits.
“Manufacturers are investing in technological advancements and the widening of magnetic sensor application areas,” noted Sankaranarayanan. “Magnetic sensors have already evolved greatly in terms of sensitivity, size, packaging and flexibility. Miniaturisation, in particular, will be a common trend in the global magnetic sensors market.”
Demand from Asia-Pacific and Latin America is likely to push technology and product development further.