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Consumer electronics' growth shapes manufacturing industry

Posted: 22 Aug 2014 ?? ?Print Version ?Bookmark and Share

Keywords:consumer electronics? CEA? smartwatch?

The latest trends in purchasing and using consumer electronics are directing the course of electronics manufacturing. The most popular uses today of consumer electronicsone of the biggest sectors in the manufacturing industry, particularly in emerging marketsare entertainment, health, and fitness.

The consumer electronics that show high growth and are expected to hold immense potential in the future include smartphones, tablets, digital radios, 3D TVs, smart TVs, and HD DVD players/recorders.

In today's mobile world, smartphones have the highest near-term purchase intent in 2014 in the mobile connected device category, with 27 per cent of consumers' preference, according to a Consumers Electronics Association (CEA) tracking study conducted in May 2014. The CEA researches and explores what the future holds for the consumer tech industry. The second place in near-term purchase intent goes to TVs with 20 per cent of consumers, followed by laptops with 18 per cent, and tablets with 16 per cent. The smartwatch industry will triple by 2015, and fitness and tracking devices are estimated to grow by 60 per cent.

According to the CEA, 85 per cent of the purchases are conducted in-store. This reveals a preference for testing, touching, and playing with the device before buying. The study also revealed that the three main reasons for consumers to buy electronics are to be entertained, to make life more enjoyable, and to stay connected to the Internet.

In the following video, the CEA explains what the future holds for the consumer tech industry:

Smartphones are consumers' preferred near-term purchase because they are easy to operate and ultra-portable for everyone. Even if the goal of carrying a smartphone is as a medical device, as is the case for an increasing number of patients, it's the mobile device of choice by the majority, so far.

What this means to electronics manufacturers

The current increase in the use of electronic devices in industries such as healthcare and the use of health and fitness applications by consumers are making electronics manufacturers shift their products' focus, adapting their production to better cater to health and fitness monitoring of individuals.

According to a PwC consumer electronics global technology scorecard, consumer electronics manufacturers like Royal Philips, Toshiba, and Sony have joined other companies in the consumer electronics segment and have started investing in the medical equipment category. The chart below shows the companies' revenue in millions of dollars from Q2 2010 to Q1 2014.

 PwC consumer electronics global technology scorecard

(Source: PwC)

According to "Global Consumer Electronics Market Outlook 2015" from RNCOS Market Research Reports, the global consumer electronics market is expected to grow at a CAGR of more than 10 per cent from 2012 to 2015. According to the report, China is currently dominating in many segments of the global consumers electronics industry and is expected to surpass the United States in total market by 2014. The report also shows that India is now the fastest growing consumer electronics market.

Taken together, the data above shows that the consumer electronics market is growing at an amazing rate, and everyone in the electronics business ecosystem should be prepared for what that means for his or her company.

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