Growth in Consumer Electronics to Exceed 4% in 2021, CTA Says
Major categories like wellness technology, 8K TVs, video game consoles and wireless headphones are all poised for a big 2021.
ARLINGTON, Va. — The Consumer Technology Association (CTA) expects another strong year for consumer electronics sales in the United States.
In its recently released “U.S. Consumer Technology One-Year Industry Forecast” report, the association says retail sales revenue for the technology industry will reach $461 billion in the U.S. in 2021 — a 4.3% increase year-over-year.
The report, which tracks manufacturer shipments to the U.S. for over 300 tech products, as well as software and services, expects work from home and remote schooling to play a major role in market growth.
As millions of Americans remain at home, most are relying on tech to stay connected during the coronavirus pandemic. As a result, streaming services, 5G connectivity and digital health devices will stand out in the tech sector.
“The pandemic has pushed the fast-forward button on tech adoption – from our homes to our work to our doctor’s offices,” says Gary Shapiro, president and CEO, CTA.
“While the road to a full economic recovery is long and intertwined with a complex vaccine rollout, the tech industry’s ability to meet the moment during this crisis has been critical. As we kick off a new year with an all-digital CES 2021, I look forward to seeing the global tech community come together to share its vision for a reimagined future.”
Entertainment Spending Continues to Soar
According to the report, spending on entertainment technology and streaming services is expected to continue at its strong pace from 2020. Total spending on streaming services and software is projected to reach a record high of $112 billion in 2021, an 11% increase over 2020. This reflects a similar trend to the 31% growth shown from 2019 to 2020.
“Tech demand in the first several months of 2021 will look a lot like the last few months of 2020,” says Rick Kowalski, director of industry analysis and business intelligence, CTA.
“Streaming services, 5G connectivity and digital health devices will push consumer tech forward in the year ahead as innovative technologies prove their resilience during challenging times. The industry’s ability to meet societal needs in a variety of circumstances will bring growth in 2021 as the world emerges from the pandemic.”
Integrators can also expect the release of next-gen game consoles from Microsoft and Sony to continue to drive sales, as the supply chain catches up with consumer demand. But the demand isn’t limited to the latest and greatest in video game technology, as combined home and portable console shipments will reach 18 million units in 2021, up 3%, earning $6 billion in revenue (up 16%).
Another area for integrators to watch is the high-end TV market. Many households channeled discretionary dollars into upgrading TVs in 2020, leading to a record-setting year for shipments.
The CTA expects steady demand for displays in 2021 as they remain the centerpiece for entertainment in homes. The association expects shipments to drop 8% to 43 million units in 2021, the second-highest volume on record, while revenues will decline just 1% to $22 billion. Growth areas for TVs in 2021 include sets over 70-inches (3.3 million units, up 6%) and 8K Ultra High-Definition TVs (1.7 million units, up 300%).
The headphone market will likely build upon a strong end of 2020 to lead to new heights in 2021. In fact, for the first time ever, total wireless headphone and earbud shipments surpassed wired headphones and earbuds in 2020. True wireless earbuds, including popular models like Apple AirPods and Samsung Galaxy Buds, are driving growth, with 91 million units expected to ship in 2021 (up 32%), representing $9.3 billion in revenue (up 16%).
Wellness Tech Remains Category to Watch
With millions of Americans spending more time at home, safety and convenience upgrades are gaining new levels of importance, driving DIY smart home products shipments to 99 million units in 2021 (up 9%), and $15 billion (up 3%). Category growth drivers include smart displays, smart doorbells and smart appliances.
Included in CTA’s forecast for the first time, personal mobility options such as electric bikes will see growth as people remain wary of public transportation. In 2021, electric bikes will reach 1.6 million units, up 60%, and $2.6 billion in revenue, up 44%.
Due to COVID-19 concerns, connected health and wellness devices are also gaining in popularity. Smart thermometers, pulse oximeters and blood pressure monitors will all seen an increase in shipments in 2021, equating to 14 million devices (up 35%) in total and $845 million in revenue (up 34%).
Data also suggests the entire health and fitness technology category, including smartwatches and fitness activity trackers, will see increases in 2021. In total, health and fitness technology forecasts to be up 13% in 2021, reaching 69 million units and $9 billion in revenue (up 6%).
This article first appeared on SSI sister site CEPro.
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