By Alan Wolf, YSN
Appliances aren’t members’ only category that has seemingly benefitted from the consumer lockdown.
According to respected tech industry analyst Stephen Baker, homebound customers are driving sales of products that support the three key aspects of “quarantine life” — home office, home education and home entertainment.
In a recent chat with TWICE Magazine, Baker, a Vice President and Industry Advisor at market research firm The NPD Group, cited retail sales gains of 19 percent in April and 23 percent in May for the tech sector, with e-commerce serving as an increasingly critical conduit. Indeed, online sales comprised fully 59 percent of CE sell-through for the first four months of the year, and Baker believes a 50-50 mix of online and in-store sales will become the new industry norm going forward.
But showrooms will continue to play an important role, even in e-commerce, he said, as shoppers have been showing a clear preference for purchasing their tech online and picking it up curbside or in-store.
And while dealers have seemingly cracked the code for operating in the time of COVID, CE manufacturers are stymied by the sudden surges in demand coupled with inventory constraints caused by factory disruptions in Asia and longer shipment times by sea. Vendors are “confused, stressed, aggravated, pressured [and] uncertain, just like the rest of us,” Baker told TWICE.
So what does this mean for the all-important fourth quarter? For a best-case scenario, Baker is sticking to his pre-pandemic forecast of 5 percent to 7 percent growth in 2020, while a more pessimistic projection puts full-year sales at flat. That said, “No one has any real visibility,” he told the publication. “Given how fast conditions on the ground are changing, this viewpoint will absolutely change again. That is what is consuming most of my time.”
Hat tip to TWICE.