While there are a plethora of new and disruptive technologies inching their way into the mass market, global sales of consumer technology products are likely to take a slight dip this year before recovering in 2018, according to Jürgen Boyny, consumer electronics global director for market research firm GfK.
Speaking in Lisbon, Portugal, Boyny noted that total global CE sales will drop from $949 billion in 2016 to $945 billion this year before recovering in 2018 to $954 billion. Boyny cited five growing tech trends key to next year’s projected jump: the rise of mobile commerce and mobile payments, the mainstreaming of VR/AR, the increasing growth of smart home, advances in the connected car and autonomous driving, and wearables.
However, Boyny also was quick to point out that these global CE sales figures do not include major or small appliances. As a result of their increasing smart and connected features, major and small appliances need to be considered as part of the broader consumer technology sales picture, Boyny implied.
With the $186 billion in major appliance worldwide sales in 2016, up between 2 to 4 percent, plus another $60.5 billion in sales of small appliances in 2016, up 5 percent, Boyny noted total consumer technology sales will soon top $1 trillion.
THE SMARTPHONE IS STILL IT
Driving all consumer technology sales is the smartphone and the growth of AI.
According to GfK, 1.55 billion smartphones are projected to be sold in 2018 — that means one in five people on the planet will buy a smartphone. A projected 1.48 billion smartphones are due to be sold this year, up from the 1.41 billion in 2015. These numbers make smartphones “by far, the biggest market in units and dollars,” in CE, Boyny noted.
Capabilities and consumer behavior weigh heavily, chief among these is the dramatic integration and effect of artificial intelligence (AI) in devices and consumer interaction with them. At the forefront of AI interactivity are smart speakers such as Amazon Echo and Google Home, sales of which has bolted from 6 million last year to a projected 59 million plus in 2020, according to GfK.
“Voice is the most obvious AI to consumers, but it’s more than that,” explained Dan Tynan of Consumer Reports, while moderating an AI panel. “Consumers may be using AI and not even know it.” For instance, AI also is prevalent in cars and in a growing number of appliances and other devices and applications such as Google Translate, 911 emergency systems and voice menus using voice analysis, as Google, Amazon and Apple via Siri drive voice command and machine learning capabilities and advancements.
“We’re entering a new era of interactivity,” explained Paul Gray, principal analyst of IHS Markit. “We moved from buttons to the mouse and pointing devices to touch and gesture, and now to pointing to a network via intelligence. Device makers will remain largely agnostic, likely supporting multiple platforms.”
One word absent from all the varying presentations on new and developing tech trends was “IoT.” “I don’t like the word,” Boyny insisted. “No consumer is going into retailers and asking to buy an ‘Internet of Things.’ Connectivity isn’t perceived to directly weigh on the value a product, but has to be sold to the consumer as a new benefit. Manufacturers as well as retailers have to make consumers aware of the benefits of connectivity.”
THE COMING UHD ERA
While mobility and AI were major themes, TV still plays an important role in the consumer technology universe. “TV still has unmatched high value at home,” stated Hans-Joachim Kamp, chairman of the supervisory board of GFU, the European version of the Consumer Technology Association. With a market value of $107 billion, “TV remains the biggest segment of the CE market not counting telecom,” Kamp continued, “and shows continuing growth due to emerging replacement demand, the rising number of single households, the increasing number of TVs per household and growing demand in emerging markets.”
According to IHS Markit’s Gray, TV shipments are on a slow and steady march toward selling 250 million units a year by 2021.
While average TV viewing times are shrinking slowly worldwide, usually by five minutes or less a year depending on the market, people still watch an average of 183.5 minutes of TV a day on average around the globe according to Kamp, with Saudi Arabia’s populace leading the couch potato parade, watching a whopping 404 minutes of TV a day.
Also boosting the TV market is the purchase of ever-increasing screen sizes as well as UHD/4K. Gray noted that the average screen size purchased is rising by an inch a year. By 2020, the average screen size purchased is forecast to increase to 46.7 inches; currently, the Chinese are buying the largest screened TVs, an average of 52.6 inches.
According to Kamp, sales of UHD sets will reach 50 percent of the market by 2020, up from the 34 percent by the end of this year. OLED, however, is making smaller inroads; Kamp noted OLED UHDs accounted for a mere 400,000 units in 2016, however OLED UHD sales are scheduled to top 1 million in 2017.