Despite Down Economy, Tablets, 'Superphones' Fuel Consumer Spending
Consumers' willingness to spend more on electronics rose in March, despite a double-digit decline in confidence in the economy, according to a report released today by the Consumer Electronics Association (CEA).
What accounts for consumers' eagerness to spend on gadgetry following a month marked by the Japan disasters, unrest in the Middle East and soaring gas prices?
Shawn DuBravac, chief economist for the CEA, cited three March events that drove consumers to bust out their wallets.
"Certainly the tablet launches that were seen over the last several weeks drove interest," DuBravac, an adjunct professor in George Washington University’s MBA program, told TechNewsDaily. "Many buyers of the iPad 2 did not own a first generation iPad ― that market is definitely expanding."
"We're also seeing a move toward 'superphones' — phones that function like a computer. A lot of those phones launched at CES [the Consumer Electronic Show] in January and then hit shelves in the past few weeks," DuBravac said. Among the superphones released in March were the HTC Thunderbolt and Motorola's Atrix 4G, both of which have screens that are 4 inches or larger.
"And then there's March Madness . Viewership is up significantly — and not just viewing on TVs, but on other platforms," he said. "Every game was available on the iPad."
CBS released its NCAA March Madness On Demand app for iPhone and iPad and has already seen a 47 percent increase in viewership across all platforms, according to a company statement.
According to the CEA Index of Consumer Technology Expectations, consumers' confidence in making new tech purchases rose more than two points in March to reach 78.5 out of a possible 200 points after two consecutive months of decline. The score reflects consumers' willingness to spend more on electronics than they have in the past. In December 2010, enthusiasm for gadget spending reached a three-year high of 93.7, but dropped more than five points in January.
During the same period, confidence in the economy fell more than 10 points to 161.4 out of a possible score of 300, its lowest point since January 2008, when CEA launched its indices.
Gas, food or an iPad? These new gadgets may prove too good to resist.