2018 Will Be a Record Year “Twice” During early 2018, the Consumer Technology Association (CTA) forecasted total 2018 retail revenues of $351 billion for the industry, a respectable 3.9% increase from 2017; however, by mid-year, CTA had revised its forecast to $377 billion, or a 7.4% increase. Although CTA cited the robust economy for its revenues revision, it also noted significant advancements in artificial intelligence, voice- recognition technology and fast connectivity are increasing consumers’ interest in and purchase of electronics. Total 2017 revenues for Dealerscope’s Top 101 Consumer Electronics Retailers list was $264.17 billion, a 14% increase over 2016; however, the top 10 retailers on the list accounted for 83.6% of those revenues, or a total of $220.84 billion.

Product Winners for 2018 Sales of “smart” products are expected to increase significantly during 2018, with smart speakers totaling $3.2 billion, a 64% increase; smart home devices totaling $4.6 billion, a 36% increase; and whole-home Wi-Fi systems totaling $1 billion, a 103% increase. Although total 2018 revenues of $21 billion for TVs will remain essentially the same as 2017, revenues for 4K UHD TVs will reach $14.3 billion, a 7% increase, and TVs with OLED displays will generate $1.4 billion in 2018 revenues, a 42% increase. Despite significant smartphone penetration, CTA forecasts 2018 revenues will total $78 billion, a 13% increase. Smartphones with 5G connectivity will first be available during 2019, and initial sales are forecast to be 2.1 million units.

Retailers’ Confidence Slows During Summer, But It’s About to Increase Typically, the Dealerscope Consumer Electronics Retail Confidence Index (DS Index) declines during the slow summer season, and it did by 10 point from July to August, or 175.21, but that was 7 points more than August 2017’s 167.9. Regional consumer electronics retailers were the most confident, with an index of 202.44, 3 points more than July, while independents and big box stores’ indices decreased a bit more than 3 points each, or 166.06 and 124.13, respectively. During June 2018, 58% of independents missed their sales goals, 21% hit their goals and 21% exceeded their goals; for regional retailers: 16%, 34% and 50%, respectively; and big box stores: 50%, 0% and 50%, respectively.

Smart Speaker: The New Home Companion As mentioned on page 1, smart speakers are a primary driver of the consumer electronics industry during 2018. According to 2018 research from Edison Research and NPR, 43 million Americans 18+ own a smart speaker, or 18% of the adult population. Somewhat surprisingly, the youngest adults aren’t the age groups with the largest percentage of ownership: 18–24, 15%; 25–34, 18%; 35–44, 21%; 45–54, 24%; and 55+, 22%.  Smart-speaker companies anticipate consumers will use them to order products. According to the Edison Research/NPR report, first adopters said they ordered 2.1 items and early mainstream users 2.7 items, on average, during the previous 3 months.

Most Consumers Not Afraid to Install Electronics According to a 2018 survey from TechSee, 71% of consumers said they preferred to self-install a new home device; 18% preferred a free technician; 6%, an assisted self-installation (contact center); and 5%, a paid technician. A majority (68%) of the surveyed consumers said there were willing to spend 15 minutes or more to attempt self-installation before contacting the supplier’s call center while 18% would spend 10–15 minutes; 10%, 5–10 minutes; and 4%, 0–4 minutes. A majority (70%) said the most effective self- installation tool was visual guidance (e.g., images, video tutorials), 25% preferred a text-based user manual and the remaining 5% said online forums and FAQs.

Building on the 2017 Holiday Shopping Record With CTA anticipating a double-digit increase in 2018 retail consumer electronics sales, Q4 2018 and the holiday shopping season are likely to be bigger than 2017 when consumer electronics sales increased 21% Thanksgiving Day and Black Friday. According to a December 2017 survey from Senex, 62% of consumers purchased electronics Thanksgiving Weekend 2017; however, 69% purchased electronics after Cyber Monday through December 19th. TrendSource revealed in its 2017 Post- Holiday Report that Amazon was the #1 purchase destinations for 41% of 2017 electronics holiday shoppers, a 5-percentage- point increase from 2016; with Best Buy #2, at 22%; and Walmart #3, at 13%.

Advertising Strategies Clearly, more and more consumers are interested in the “smart” home, so independent and regional consumer electronics retailers may be more competitive with a “Holiday Smart Home Bundle” that includes a smart speaker, whole-home Wi-Fi and similar devices. Offer a “Car Tech Travel Bundle” with a qualifying purchase of car tech devices that could include a car holder and cups (or just cups), a selection of healthy snacks, etc. Independent and regional retailers can also respond to consumers’ interest in self-installation of electronics by heavily promoting retailers’ online visual guidance content.

New Media Strategies Independent and regional retailers can serve the majority of consumers who prefer visual guidance of their self-installation of electronics by recording short step-by-step videos, with store associates as hosts, explaining how to install various devices. Car tech is also likely to be a big seller during Q4 2018, so independent and regional retailers could offer three free months of consumers’ favorite streaming audio service with a qualifying purchase. An influencer marketing program could boost independent and regional retailers’ competitiveness. Media Group Online has two 2018 New Media Insights Reports that explain much of what retailers need to know and do to start such a program.