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Electronics are a top priority even for cash-strapped consumers, beating out other desirables when money becomes tight, according to a March 18 report from iSuppli.
While 2009 worldwide per capita income declined by 2 percent – the first ever annual decrease in the post-World War II era – revenue for the global electronics market nonetheless rose. Global smartphone shipments were up 13.1 percent for the year, says iSuppli, while LCD-TV shipments increased by 42 percent and netbook shipments were up 100.8 percent.
“There’s been a measurable shift in how consumers are spending their disposable income,” Derek Lidow, iSuppli president and CEO, said in a statement. “In a time of great economic distress, when people had less money and spending on essentials like food and rent declined, consumers surprisingly used a disproportionate amount of their money to purchase new consumer electronic products.”
More restraint, however, has been shown toward items such as jewelry, vacations and restaurant meals – a trend that iSuppli expects will continue into 2010 and beyond.
“Rather than spending on travel, people are opting to take -staycations,’ where they stay home during their vacation time,” said Lidow. “To make their staycations more enjoyable, consumers are buying products to entertain themselves in their homes, including LCD-TVs.”
iSuppli forecasts that global factory revenue from shipments of consumer electronics, a category including LCD-TVs, will increase by 3.2 percent in 2010 and continue on to 7.8 percent in 2011. Smartphones are expected to rise 10.8 percent in 2010 and 13.1 percent in 2011, while the computer segment, driven in part by netbook sales, is expected to rise by 7.8 percent in 2010 and 7.9 percent in 2011.
Consumers in the developing world – which felt the affects of the recession less acutely than developed markets – increasingly spent on devices that “enable them to be connected to the Internet as they move from place to place,” wrote Lidow. Primarily, this translated to consumers spending large shares of their incomes on their first cell phone subscriptions.
“The importance that consumers are placing on these electronic products when it comes to spending is a very positive development for the global technology industry and should be a cause of optimism in the years to come,” said Lidow.
What it may mean for the consumers themselves is another matter.