Consumer Electronics: Overview and Trends
The consumer electronics industry is characterized by a high level of diversity, creativity and flexibility. It includes technological solutions ranging from commercially viable and mass-produced devices to experimental technologies that are in the early stages of being transferred from academic and private research institutions and consortiums to viable profit-seeking enterprises.
Some key products in consumer electronics include televisions, handheld devices, personal computers, cameras and camcorders, audio/video devices, personal care products and gaming consoles.
Leading players in consumer electronics market are:
- According to Statista’s Consumer Electronics Report – 2019, Consumer Electronics generated an overall of $997 billion in revenues worldwide in 2018
- According to Planet Retail RNG, Asia is leading the world in consumer electronics spend and growth
- IDC predicts that global consumer electronics spending will reach $1.68 trillion in 2019, a year-on-year increase of 5.3%. As such, the market will reach $2.06 trillion in value by 2023
1. Artificial Intelligence and Machine Learning
The application of AI into the industry of consumer electronics has opened up many growth avenues and opportunities. For attracting the ever-evolving customers, consumer electronics (CE) manufacturers are adopting AI and machine learning specifically to appeal to the customers and cater to their needs and requirements. The adoption of AI in the CE industry has thus birthed the growing trend of producing Smart electronics.
According to Gartner, customer service and experience is a critical area impacted by AI. CE companies will continue to deploy intelligent apps and Big Data analytics to refine their offerings to improve customer experience (CX). With natural language processing and machine learning, businesses can harness AI to mimic human speech patterns to provide better customer experience without human intervention.
Closely linked with AI is the adoption of IoT in the Consumer Electronics industry. Consumer electronics companies are integrating their products with the IoT technology to produce a mass breed of smart appliances. Resultantly, the market for IoT in consumer electronics is growing promptly, gathering a huge grip on the global platform. According to Market Research Future, the global IoT in Consumer Electronics Market is estimated to reach $124 billion recording a CAGR of 24.16% through the forecast period 2017 to 2023.</p.
Samsung seems to be one of the companies betting the most on IoT. They have launched SmartThings, a ‘brain’ that wirelessly connects a wide range of smart devices and makes them work together. Philips showcased its new Vintage LED Bulbs that are controllable through two different protocols: Zigbee and Bluetooth. With Phillips Hue Bridge hub it is possible to connect the bulbs to certain devices with voice assistant capabilities and control it through Amazon Alexa and Google Assistant.</p.
The shepherds in the Consumer Electronics industry are clearly AI and IoT who are converging to lead the industry to smart and connected electronics. Birthed by the influence of these two transformative technologies are the growth of the following products and features
- Growth of Smart Homes
- Voice Interfaces and assistance
- Virtual and Augmented Realities
- Health and Wellness gadgets/ features
- Sleep Tech
- Vehicle Electronics
- Sport Electronics
3. Growth of Smart Home Appliances
The rapid adoption of connected devices has empowered consumers to control their home appliances and protect their homes remotely from their smartphones or tablets. Consumers are increasingly seeking smart home devices. Smart home devices are extending beyond catering to humans and are being produced for pets as well. Automated feeders and smart cameras are also growing in popularity.
PwC predicted £10.8 billion would be spent on smart home devices in 2019 alone. Amazon seems to be the top player in the smart home market and is on the verge of establishing itself as the market leader. With the previous acquisition of a mesh home router producer, Eero, and the home security company Ring, Amazon is able to integrate these systems to provide a full-service-set of option for homeowners. Furthermore, Amazon has increased its investment on smart homes significantly, introducing dozens more Alexa-enabled products
4. Growth of 5G
5G is an impending technology that is projected to massively impact the consumer electronics industry in the not-so-distant future. Consumer electronics companies have been increasingly showcasing the potentials of 5G in enhancing their products .For instance, at the CES 2019, Chipmaker Qualcomm devoted a large portion of their display in showcasing what 5G could potentially do for both smartphones and VR headsets. At IFA 2019, T-Mobile showcased the advantages of 5G to consumers, with demonstrations of content streaming, high speed video download and real-time multi-user gaming using augmented reality.
Store-within-a-store pop-up retail strategies and models are growing in popularity among consumer electronics brands primarily because most retail partners are brand agnostics and fail to sufficiently explain brand USPs and provide customers with adequate recommendations. The concept is also popular with consumers because it offers them more in-depth access to brands in a familiar retail setting. According to Zoovu, over 64% of consumers prefer an in-store shopping experience where associates can provide in-store services through digital technology. In August 2019, Microsoft refreshed their “store-within-a-store” installations within Best Buy by working closely with PremierXD who provided engineering, prototyping, manufacturing, installation and maintenance for the program.
6. Social Media Dominance
Social media plays an important marketing role in the Consumer Electronics industry. According to Retail touch points, it is the product category that is most influenced by social media posts. Additionally data provided by the Consumer Electronics Association also reveal that approximately 24% of consumers looking to make an electronics purchase “always or almost always” refer to social media before they buy. Four in five users said reviews or comments on social media sites by someone they know influenced their consumer electronics purchase decisions. Consumer Electronics brands have thus been extensively using social media platforms for consumer engagement, with social media campaigns often incorporating influencers, video contents and incentives to create user generated contents