UK consumers are gradually developing more cosmopolitan tastes for wall coverings, which benefits the ceramic tile market, since many other countries make more extensive and bolder use of tiles. The use of ceramic floor tiles in the UK was low in the 1990s, but this sector is now showing relatively strong growth. The interest in a more Mediterranean style of decor has had the opposite effect on the wall coverings market, encouraging the preference for painted walls.
The manufacturers of tiles and wall coverings work hard at product innovation and fresh new collections come onto the market each year.
The trend in tiles is currently for whites and natural, neutral colours, with added interest coming from textures and decorative strips, and borders. Matching floor and wall tiles are also coming onto the market. The period from 2001 to 2005 has seen a drift towards larger tiles and greater variety in the choice of sizes and shapes. Product innovation in wall coverings in the last 5 years has tended to involve new textured designs, easier-to-use wall coverings and the use of highly decorative designs for single feature walls.
Economic trends, particularly the growth in household disposable income, have been generally helpful to these markets in the period from 2001 to 2005. Consumer confidence has wavered somewhat in 2005 and the housing market has slowed. The overall market for do-it-yourself (DIY) materials, which has grown strongly between 2001 and 2004, appears to have levelled off or taken a slight downturn in the first half of 2005. Growth in the tile market seems to have slowed following these background trends, although the longer-term pattern is for growth. The effect of the economy on the wall coverings market is masked by the fashion swing away from wall coverings and towards painted walls.
Key Note values the UK retail wall coverings market at £358m retail selling prices (rsp) for 2004. The market has been in decline for some years and a further fall in 2005 to £347m is predicted. Key Note estimates that the value of the retail market for ceramic tiles in 2004 was £482m rsp and expects very modest growth in 2005 to £485m.
The wall coverings market divides into sidewalls and borders, and also by substrate sectors: wallpaper, flat vinyl, blown vinyl, expanded vinyl and others, which are primarily various types of plain whites other than white blown and expanded vinyls. The main division in the ceramic tiles market is between wall tiles and floor tiles. It includes both glazed and unglazed ceramic tiles, but the glazed type of tiles make up the majority of the market.
Key Note does not expect an immediate recovery in the wall coverings market, but forecasts a levelling off in volume in 2007 followed by an eventual upturn. The increase in prices of raw materials and increased transportation costs are likely to put prices up slightly, as these have been held down for some time. The retail tile market is expected to return to stronger growth in 2006 and to continue up to 2010. In 2005, the growth segment for wall coverings is the higher priced and upper middle of the market. In tiling, the growth in 2005 is coming from floor tiles. These trends are expected to continue past 2006.
