CEA Revises Holiday Forecast
Dec 5, 2008 9:41 AM
Arlington, VA - Dec 4, 2008 - The Consumer Electronics Association (CEA) revised its projected industry growth for the fourth quarter of 2008 as new data shows the economy and consumer sentiment remain muted, and CEA surveys show overall spending is down this holiday season. Newly available data, including final October shipment and revenue data and a new survey of Black Friday shoppers, leads the CEA to project fourth quarter wholesale shipment revenues to increase by 0.1 percent over the same period in 2007. The original forecast, issued in October, anticipated 3.5 percent fourth quarter growth over 2007.
CEA's earlier forecast was based on shipment data, consumer surveys and economic analysis available in early October. Flat-panel TV shipment revenues in September 2008, for example, were up 32 percent on unit volume and up eight percent on revenue over 2007. In October 2008, unit shipment growth of flat-panels remained high at 22 percent but shipment revenues fell to negative three percent, affecting the fourth quarter forecast. The revised holiday forecast also reflects new data indicating that holiday shoppers are opting for smaller, less expensive TVs and other CE products purchased at discount retailers.
Mobile phones and computers are also feeling the impact of the economy. Mobile phones will see five percent growth in the fourth quarter compared to last year, a projection revised downward from CEA's 11 percent growth forecast issued in October. Consumers are holding off on upgrading their handsets while steeper than expected price declines are cutting into revenues. Greater than expected discounts on laptops and an increased interest in lower-priced netbooks are impacting the computer category, which is now projected to post a year-over-year revenue decline of two percent, down slightly from CEA's earlier estimate of negative one percent growth.
Consumers are taking advantage of lower prices available from a variety of retail outlets. CEA's Black Friday survey showed that roughly a third of adult consumers shopped between Black Friday and Cyber Monday. Consumer electronics (CE) remained a popular choice for a majority of shoppers. Fifty-four percent of consumers that shopped over the Black Friday weekend purchased a CE device during that period, making it the second most frequent purchase product behind clothing.