CES: The NPD Group Analyzes Changes in Consumer Trends
By Phil Lelyveld
January 5, 2023
The NPD Group’s Paul Gagnon and Ben Arnold presented “7 Ways the CE Consumer Has Changed” in the last few years. U.S. consumer attitudes and behaviors changed from early-pandemic lockdown to the slow reopening, and then the fear of inflation and recession. In general, consumers are buying more for individuals than for shared home experiences, they have equipped themselves for remote work which may suppress future sales until they are ready to upgrade, and they buy when bargains appear even if they plan to actually open them for a holiday or special occasion.
Gagnon and Arnold addressed the following trends identified by The NPD Group.
Consumers are willing to pay more: Prices went up during the pandemic due to shortages and supply chain disruptions. That primed consumers for decreased price sensitivity just as prices started to go up due to inflation.
Non-traditional shopping seasons grow: Amazon created Prime Day in July as a global purchasing event. Other retail firms have built on both Prime Day and Black Friday; for example, Best Buy (October 10-12), Target (October 6-8) and Walmart (October 10-13).
Demographic changes matter: In 2022 consumers with incomes over $100K per year accounted for 46 percent of all consumer tech spending. Consumers ages 18-24 spent the most on notebook PCs, ages 25-34 led TV purchases, ages 35-44 were the largest purchasers of notebook gaming PCs, ages 45-54 were the largest cohort for desktop gaming PCs, and ages 55+ bought a significantly higher share of tablets.
Tech products are essential: The spike in work-from-home and remote schooling drove a spike in tech resource purchases. Consumers are buying for individuals within the household rather than shared resources for the household. Looking forward, 31 percent say that they will cut back on buying tech products in 2023, while only 25 percent plan to cut back on gaming and streaming.
Online and social shopping: The e-commerce share of total tech dollars spent increased from 44 percent in 2019 to 57 percent in 2022. This includes online purchases for both home delivery and in-store pick-up at brick-and-mortar retailers. Additionally, 20 percent of consumers plan to use social media to research products, a bump from past responses.
Technology to make life better: Item trackers, like the Apple AirTag, have achieved 41 percent revenue growth in 2022. Digital health tech similarly showed 31 percent revenue growth.
Flexible work: Desktop monitor sales grew 78 percent in 2020 and another 7 percent in 2021.
Looking toward the near future, The NPD Group is watching experimentation with features-as-a-service. Last November, Mercedes-Benz announced that it would lock faster acceleration for its EQ electric models behind a $1,200 annual pay wall. NPD posited it is possible that a display manufacturer may make one full-featured device and sell it at different price points and subscription levels depending on which features are unlocked at the point of sale.
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