Do Not Count on Early Adopters to Positively Impact Sales this Holiday Season

November 23rd, 2016

We ran a recent study among 600 early tech adopters and 600 mainstream tech consumers in the US. It did not leave much hope that tech will be capturing much of consumer’s budget over the holidays this year. Among early adopters, 18% said tech would be their biggest money grabbing category as opposed to a mere 7% among mainstream consumers. Among the consumers who are not allocating their biggest spend to technology, the reasons for not doing so were quite different. As you would expect, early adopters (59%) said the what they have already is current and incremental improvements are not worth spending money on. Only 25% of early tech consumers said they have enough tech as it is. Among mainstream consumers, 35% said their budget is tight this year while 36% said they have enough tech.

With already enough technology in the home or the feeling of being up to date, it was interesting to see mainstream consumers were not interested in any new technology category. A whopping 64% said they were not planning to buy anything among the hot holiday’s items compared to a more moderate 33% of early adopters. Wireless headsets were the category most mentioned by both early tech and mainstream as an item of interest. We cannot point to Apple as being the driver of this interest, given the iPhone 7’s lack of audio jack. However, it is easy to see how new working habits that see people being highly mobile and working in remote locations might help drive updates for work as well as play with a higher focus on content consumption. The Nintendo NES Classic was another item that stood out across the two groups with 11% of early adopters and 5% of mainstream consumers saying it was on their shopping list.

We dug deeper into consumers’ intention for wearables, smartphones, TVs and PC/tablets. We looked at drivers and inhibitors, and we saw little change to the themes we discussed earlier in the year. Inhibitors were longer life cycles for smartphones and PCs/tablets, unclear value add for wearables, and lack of a need to replace TVs. Every year we see an enormous amount of marketing dollars spent leading up to the holidays in advertising and promotions over the holidays with the pinnacle being Black Friday and Cyber Monday. Interestingly, it does not seem mainstream consumers see those deals as very influential. Across the main categories, wearables and TVs are where that influence matters more. I find this interesting because these two categories are also the ones where consumers are focusing on spending the bare minimum.

Finally, considering the current post-election mood, we thought it would be interesting to take the pulse of the current consumer confidence. Across the board, only 20% said they felt the same as they did before the elections while 25% felt very concerned about the state of the economy. As a result, 15% are planning to be much more conservative in their tech spend, and another 11% plans to be somewhat conservative. Fortunately, 70% say they have made no change, so there is still hope technology is seen as a necessity for many. That being said, vendors would be wise to focus their marketing more on clear value propositions of their products — whether that is in the hardware look and feel or a need the device fulfills. At a point where consumers see technology innovation as incremental and are satisfied what they currently have, “a bit better” won’t sell unless the vendors can leverage a more visceral, rather than rational, need.

Methodology: In mid-November 2016, we surveyed 600 early tech adopters and 600 mainstream tech consumers across the US. The study was run online, and the sample was representative of the US population.

If you are interested in the full report, please do not hesitate to get in touch with us.

Carolina Milanesi

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