While 2018 may not have been a record-setting growth year for consumer tech retailers, that doesn’t mean there wasn’t a plethora of product categories driving new sales. We conferred with The NPD Group to learn the top consumer electronics categories based on U.S. dollar growth last year vs. 2017.
As NPD VP and industry advisor Stephen Baker explained, some made the list primarily because they were a “greenfield” segment that didn’t previously exist; however, it’s important to note that all generated at least $250 million in sales last year.
(Whether they’ll make next year’s list is a different story.)
1. Wireless Charging
Wireless charging pads accounted for the bulk of the growth in this category, but don’t expect that to last going forward. The pads are really just the beginning of this technology’s potential, said Baker, and over time we’ll see it evolve into becoming present in almost anything that already has wires or technology built into it.
Just as we’ve seen USB ports integrated into items that aren’t traditional viewed as tech devices, expect to see wireless charging integrated into lamps, furniture and appliances. As such, while wireless charging could potentially make next year’s list, we’ll likely see the demand for stand-alone devices drop.
2. Smart Entry (Doorbells and Locks)
“This is your classic kind of greenfield category,” said Baker. “Five years ago, doorbells were not a technology item. Door locks were not a technology item. We’re seeing those grow fast because of the overall interest in smart home, but these are specifically growing fast because they solve security needs and they integrate well with other parts of the smart home.”
While demand for video doorbells may taper off — consumers typically need just one for their front door, Baker noted — locks are expected to continue their growth trajectory as consumers are more likely to purchase multiples.
3. Smart Watches
Another greenfield category, smart watches made by Apple and other manufacturers are expected to continue growing.
“We’re pretty bullish on the fact that smart watches are going to grow over and beyond just what you might think of just as a tech product because of the other opportunities to use it around thing like health and fitness,” said Baker. “Over time, those kind uses will stand up next to getting text messages and getting directions on your wrist, and they’ll replace needing to take your phone out of your pocket and even needing to have a phone.”
He also cited smart watches’ robust selling prices and requirements for service control, making them attractive to both OEMs and retailers interested in the annuity value. As with smartphones and headphones, smart watches carry an inherent upgrade cycle and fashion association, with consumers motivated to replace them for newer designs and more advanced features.
4. Mesh Routers
Expect mesh routers to be a one-and-done category on the growth list, but not because of their usefulness — far from it. Unlike a smart watch that you look multiple times a day, a mesh router is typically something consumers stick in the back of their homes and don’t think much about, Baker explained.
Retail sales are also likely to be undercut as ASPs come down and cable and Internet service providers are able to offer more products to their customers.
“Of the five things here, I think for most people this would be the most useful product they could buy, but it’s also probably the one they’re least likely to buy,” said Baker, citing consumer unfamiliarity with the product and a fear of upgrading infrastructure technology.
5. Wireless Headphones
While true wireless headphones have garnered many of the headlines last year, growth in this category was accelerated by all wireless cans — true wireless, premium, noise canceling and entry level.
“We spend a lot of time talking about true wireless, but what we don’t talk a lot about is the switch from low-cost wired to low-cost wireless,” Baker noted.