Record-Setting Industry Sales Forecast Similar to last year, the Consumer Technology Association (CTA) predicted $398 billion in total industry sales for 2019 during January, or a 3.9% YOY increase, but revised its forecast during July 2019 to $401 billion, or a 2.2% YOY increase. CTA cites increasing interest among consumers for emerging technologies, such as smart home/speakers, home robots, wireless earbuds and smartwatches. Although smartphone sales will likely decrease, 5G technology will give it a boost beyond 2019. The NPD Group’s forecast is similar, or a 2% increase for 2019, but it must measure industry sales differently, as it predicts total sales of $94 billion. Growth through 2021 will also be at a low, single-digit rate.

CE Retailers’ Confidence Soaring, But Brick-and-Mortar Sales Souring Dealerscope’s CE Retail Confidence Index reached its highest point ever during June 2019, or 213.89, compared to 195.29 during June 2018 and 182.96 during June 2017. Despite CE retailers’ confidence, sales at brick-and- mortar stores accounted for just 22% of CTA’s estimated $377 billion in 2018 industry sales, according to US Census Bureau data, with the $84.3 billion in 2018 sales just a 1.7% increase from 2017. Brick-and-mortar CE retailers’ Q4 2018 sales of $25.8 billion was a 1.9% decrease from Q4 2017, and the first 5 months of 2019 recorded an even large decline, or - 4.6%, to $30.6 billion.

US Adults Can’t Live Without CE Devices Americans’ almost obsessive daily engagement with media drives most CE sales – and according to Nielsen’s Q3 2018 Total Audience Report (the latest), the average for all US adults was 10 hours, 30 minutes per day. The total daily average didn’t change from Q3 2017, but the “app/Web on a smartphone category” increased the most, from 2 hours, 14 minutes to 2 hours, 31 minutes. Although “Live+Time-Shifted TV” (4 hours, 13 minutes) still dominated the 5 hours, 24 hours per day US adults spent with video-content devices, “video focused app/Web on a smartphone” increased from 8 minutes to 11 minutes.

Smart Speaker/Smart Home Technologies Driving the Market According to the results of its Q4 2018 survey of 5,000 consumers, The NPD Group reported 22% of US Internet households owned a smart home device, which could include a security system, doorbell, thermostat, smart speaker, etc. A December 2018 NPR/Edison Research survey found smart speakers in US households increased 78% from 2017’s 66.7 million to 118.5 million as of December 2018. Interestingly, men’s ownership of smart speakers more than doubled for 2018, to 47%. Although the percentage of those who owned one smart speaker decreased from 62% during December 2017 to 48% during December 2018, those households owning three or more almost doubled, from 17% to 30%.

Future CE Purchases on Consumers’ Radar Unsurprisingly, The Media Audit’s February 2019 Aggregate Survey of 66 US markets representing more than 140 million US adults, reports more men than women plan to buy a new TV during the next 12 months, or 55.2% and 44.8%, respectively. Almost 44% of all US adults who said they plan to buy a TV during the next 12 months were 25–44, but 14.8% were 55–64. For adults planning to buy a smartphone, the age groups with the largest percentages were 55– 64, 20.1%, and 65–74, 15.1%. A niche consumer audience CE retailers must also engage and attract is working women. The Media Audit data reveals a much larger percentage are planning to buy a TV, or 21.1%, than a smartphone, 1.1%, during the next 12 months.

A Future of New Products and Further Advancements Just as 4K TVs replaced 2Ks, 8K TVs will replace 4Ks. The transition will be slow, as 8K TVs cost in the $5,000+ range, are limited to sizes larger than 60” and there isn’t any true 8K content available yet. The forecast is just 1.3 million sold by 2023. If the results of a 2019 CTA study are accurate, then consumers are quickly losing their fear of robotics, as 84% said they “are enthusiastic about using robotics technology in everyday life,” including household chores, delivery, health care and education. Similarly, consumers were generally unsure about the use of drones, but another 2019 CTA study found 75% of US adults are comfortable with their use in many settings. The study also forecasts 12% of households are likely to buy a drone during 2020.

Advertising Strategies Consumer electronics stores can use consumers’ interest in emerging technologies, such as home robots, wireless earbuds and smartwatches, to help increase sales of more common technologies by including a limited-time coupon with a new technology purchase. Like many retail sectors that e-commerce has disrupted, consumer electronics stores may have to consider expanding into ancillary products groups, more services, co-branding with other stores and other new and proactive retail trends. The more than 200% increase in men’s ownership of smart speakers is an opportunity for CE stores to advertise these products during sports and other appropriate male-dominated programming.

New Media Strategies With so many new and advancing CE products on the horizon, stores should consider asking one or more customers to serve as “influencers,” and allow them to try new products and report their experiences in short videos for social media posting. To counter the strong competition from e-commerce, local CE stores may have to become more involved in their communities. For example, offering free CE workshops at senior centers to help the many seniors starting to use technology, social media, etc. Local CE stores may be able to serve as a “technology consultant” for local government leaders, considering the lack of knowledge demonstrated by members of Congress when questioning the titans of technology, e- commerce and social media.