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IDC's ConsumerScape 3600 Finds a Significant Drop in U.S. Consumer Electronics Spending – More Than Any Other Large Industrialized Country

FRAMINGHAM, Mass.--(BUSINESS WIRE)--The U.S. consumer electronics (CE) market has been hit disproportionately hard by the economic downturn, with U.S. households projected to spend 17% less on CE in 2010 than the previous year. This is the largest projected decline in CE spending among the 20 countries surveyed by the International Data Corporation (IDC) in a recent ConsumerScape 3600 study. Among these countries, the emerging BRIC markets (Brazil, Russia, India, and China) are expected to lead the CE recovery with household CE spending gains of more than 20% year over year.

"The survey found U.S. consumers to be extremely price sensitive, a clear sign that the economic downturn has had an impact not only on spending habits, but also on consumer psychology"

Despite the decline in U.S. CE spending, IDC found that important opportunities still exist within key product categories and across specific consumer market segments. Even though U.S. consumers are spending less on CE, they still own more devices (an average of 15.4 major devices per household) than in other geographies. Moreover, U.S. consumers still tend to buy higher-end devices with more features and functions than consumers in other markets.

IDC believes that there are six distinct consumer segments in the CE marketplace: Engaged Hipsters (young and trendy, likely to buy the latest and coolest devices); Tech Evangelists (the most adept, and influential, technology users); Savvy Sale Shoppers (moderate interest levels but will buy if the price is right); Impulse Buyers (high income buyers that purchase whatever new products catch their eye); Socially Conscious Basic Buyers (family and environmentally focused, unlikely to buy what they don't need); and Disengaged Functionalists (low income buyers with little interest in CE). IDC found that more than half of the U.S. population can be characterized as basic buyers (Disengaged Functionalists and Savvy Sale Shoppers), reflecting the current state of the U.S. economy. Moreover, the number of Disengaged Functionalists is significantly higher in the U.S. (34%) than in the other countries surveyed (16% worldwide).

"The survey found U.S. consumers to be extremely price sensitive, a clear sign that the economic downturn has had an impact not only on spending habits, but also on consumer psychology," said Michael DeHart, director of IDC's ConsumerScape 3600 and Consumer Primary Research. "At the same time, U.S. consumers are far less likely to buy simple, basic devices, which is indicative of the population's strong affinity for consumer electronics."

The U.S. markets where IDC believes important opportunities exist for CE manufacturers include:
  • As U.S. households shift toward notebooks, PCs will increasingly be viewed as personal CE devices, fueling long-term growth in notebook PCs as well as PC peripherals
  • With only 28% of U.S. households owning a smartphone, growth in this category is a sure thing, to be accompanied by a range of features, data plans, and apps to suit different budgets
  • Although HDTV ownership has already crossed the 50% mark among U.S. households, the market is expected to continue its dramatic growth trajectory
These statistics and others may be found in IDC's recently published report, U.S. Consumer Insights - Beyond Early Adopters (IDC #223930). The report is the second in the ConsumerScape 360º series, and offers a deep-dive into consumer market segments and key product categories in the U.S. The report seeks to deliver a nuanced understanding of how consumer groups differ, what key opportunities exist within each product category, and how to target consumers via their media consumption platforms and demographic profiling.

About IDC's ConsumerScape 3600

IDC's ConsumerScape 360º service utilizes direct global primary research to provide insights and trends regarding consumer electronics and digital services. As data, communication, video, and entertainment services proliferate, the way businesses segment consumers needs to evolve. Using advanced market segmentation techniques, ConsumerScape 360º identifies and profiles consumer electronics market segments based on usage/ownership behavior, technology adoption, brand preference, competitive analysis, and psychographic factors governing cross-category spend.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community to make fact-based decisions on technology purchases and business strategy. More than 1,000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. For more than 46 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com.

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