Q4 consumer tech sales primed for 18% surge

Having spent spring and summer equipping their homes for work and education, US consumers are expected to turn their attention in Q4 to more leisurely pursuits.

That is what NPD Group thinks, anyway. The analyst firm predicted this week that consumer technology sales in the final three months of this year will jump 18 percent on last year, led by old favourites like TVs. By comparison, sales growth between Q4 2019 and Q4 2018 was just 4 percent.

“Sales of items we need to get through the school or workday took priority in the first half of this year,” said Ben Arnold, executive director and industry analyst at NPD Group, in a research note.

Indeed, according to NPD, monthly technology sales have seen double-digit year-on-year growth since March, when the US imposed lockdowns to try to contain the spread of coronavirus. In the second quarter alone, sales of notebook computers and tablets were up 45 percent and 37 percent year-on-year respectively. Monitor sales surged 84 percent; printers by 59 percent; and keyboards and mice by 62 percent.

“But as we head into Q4 and the holidays we expect many of these ‘needs’ will have been satisfied and consumers will begin to purchase items they consider to be ‘wants’ or gifts for the holiday season, such as TVs and noise-cancelling headphones,” Arnold said.

Indeed, and with Samsung having shown off its new Note 20 last month, Motorola updating its Razr this week, and with Apple due to refresh its iPhone line-up this autumn, smartphones are highly likely to make it onto a few shopping lists as well. It is also worth mentioning Microsoft, which is reportedly prepping at least one new Surface product in time for Christmas, so maybe a new laptop will also be on some people’s minds.

It is also worth considering the number of people who might have saved up for a holiday only to decide against making a trip for coronavirus reasons. They might opt instead to spend that money on something to make a long winter at home more bearable.

“As we head into Q4 and into 2021, we’re forecasting technology sales will remain strong as the pandemic has renewed recognition of the critical value of technology in the modern lifestyle, sped-up product upgrade cycles and created larger installed bases that will benefit the industry moving forward,” said Stephen Baker, vice president and industry advisor at NPD.

Unsurprisingly, the pandemic-induced shift to e-commerce from brick and mortar shopping is expected to carry on for the remainder of the year.

NPD said online shopping accounted for 69 percent of consumer tech sales in the second quarter, compared to 48 percent a year earlier. It is expected to remain above 60 percent moving forward. Meanwhile, click-and-collect – and what NPD calls buy online and pick up curbside – purchases represented a quarter of all technology sales in Q2, and that trend is expected to continue as well.

“Black Friday lines won’t disappear but we expect lines of consumers waiting for store openings will be replaced by long queues of cars eagerly waiting for buy online, pickup curbside purchases,” Baker predicted.