NPD: 2021 U.S. Consumer Technology Revenue Up 9%, Following Double-Digit Growth in 2020

Last year (2021) was a record-setting year for the U.S. consumer technology industry with sales reaching nearly $127 billion dollars, up 9% from 2020’s double-digit increase, according to new data from The NPD Group.

That momentum is expected to cool from 2022 through 2024. While total sales will remain above pre-pandemic levels, NPD’s most recent Future of Tech forecast reveals year-over-year U.S. CE industry revenue is expected to decline 5% in 2022, 4% in 2023, and 1% in 2024.

“In the near-term we are anticipating slowing demand from the extraordinary rates we have been seeing over the last two years,” Stephen Baker, VP and industry advisor for NPD, said in a statement.

A trend that began pre-pandemic but will carry into the new year is rising average selling prices (ASPs). This year will see the fifth consecutive year of industry level ASP increases, with overall unit pricing expected to top $72, up $16 from 2018.

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Last year ASP increases were in part the result of growing shipping costs and component shortages, but much of that was not felt until the second half of the year. Going forward NPD expects to see selling prices remain stable at this new, higher level due to the combination of strong demand for premium solutions and softening consumer needs for lower-value device categories.

“With such high levels of purchasing in 2020 and 2021 driven, in many cases, by pandemic lifestyle changes, we are seeing a larger, and younger, installed base for a number of devices,” Baker said. “This will inevitably slow consumer needs in the immediate future for technology updates and upgrades.”

Despite the anticipated declines, NPD’s forecast indicates smart homes will be an area of growth for the industry. In 2022, the category is expected to see unit growth of 6%, accompanied by 2% revenue gains, bringing total sales to over $4.1 billion. This will result from gains in security focused segments, including security cameras (up 2%), smart doorbells (up 13%) and smart locks (up 8%).

“Sales of smart-home devices had a strong 2021 holiday season, and we are forecasting unit and dollar sales to continue growing through 2024,” added Ben Arnold, executive director and technology industry analyst for NPD. “Consumers are also focused on entertainment, which will result in sales growth for standalone VR headsets and big-screen TVs (65-inches and above) through the forecast period. While VR offers a unique entertainment experience, growth in big screen TVs will continue from pre-pandemic trends towards larger screen sizes.”

Roku Ups Audio Partner Adoption and International Expansion

Roku Dec. 29 announced new growth and international expansion to its “Roku TV Ready Certification” program. Designed to simplify the home theater, the Roku TV Ready program enables third party A/V and consumer electronics companies to enhance their audio products to support seamless setup, single remote operations, and easier access to home theater settings on screen when connected to a Roku TV.

New partners added in 2021 included Element, JVC, Pheanoo and Philips, with Polk Audio and Westinghouse joining in early 2022. Existing Roku TV Ready partners include Bose, Hisense, TCL North America and Sound United, parent company to Denon, Definitive Technology and Polk Audio. Additionally, the program was expanded internationally with partners launching in the United Kingdom, Canada and Mexico.

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For partners, the Roku TV Ready program includes an easy-to-implement software development kit (SDK) and test materials to fast-track integration. In addition to Roku TV Ready, Roku also offers a wireless soundbar reference design for companies looking to deliver high-performance home theater without running wires to the TV.

“Whether you are a soundbar manufacturer interested in providing your customers with a seamless home theater experience or would like to integrate Roku’s wireless audio technology, [we] make it easy for manufacturers to utilize [our] technology,” Mark Ely, VP of product strategy at Roku, said in a statement.

LG to Demo Flexible OLED Tech at CES 2022

LG Display will be demonstrating its flexible OLED technology at CES 2022, showcasing two new product concepts — “Virtual Ride” and “Media Chair.”

LG Display’s Virtual Ride

The Virtual Ride is an indoor stationary bicycle with three vertical 55-inch OLED displays in front of and above it. The advanced displays come together to form one large, curved, r-shaped display that gives users a view both forward and above. The display that bends to create the ceiling above the rider has a curvature radius that reaches 500R, or a radius of 500mm, the most among existing large displays, according to LG.

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“The OLED displays provide unparalleled lifelike colors with their vivid picture quality to make you really feel like you are cycling outside in a forest or down the street of a European village,” according to an LG press release.

The Media Chair combines a 55-inch OLED TV display with a recliner. The screen boasts a curvature radius of 1,500R, the optimal angle for the user, as well as the company’s built-in sound technology Cinematic Sound OLED (CSO), which enables the display to vibrate to make its own sound without the use of external speakers, according to LG. The chair display’s pivot function allows the screen to rotate between vertical and horizontal orientations with a button on the display of the armrest. “This gives the user the unique opportunity to customize their immersive viewing experience thanks to the OLED technology to perfectly fit whatever content they want to watch,” according to the release.

The OLED display boasts tens of millions of self-emitting pixels to eliminate the need for a separate backlight, according to the release. It comes in various forms, such as bendable, foldable and rollable.

“We will continue to provide differentiated value to our customers through OLED’s infinite potential while also moving forward with integrating our business into diverse industries,”  Yeo Chun-ho, head of the business development division at LG Display, said in a statement.

NPD: Mixed Black Friday, Cyber Week CE Sales Results

It was a mixed bag for consumer electronics during last month’s annual post-Thanksgiving Black Friday retail day/week, including Cyber Monday, according to new data from The NPD Group.

The industry saw a 15% year-over-year revenue increase, while Cyber Week saw a 3% increase versus year ago. Much the revenue gains were due to category price hikes Results for these two weeks were up versus 2019, as the strength of online shopping reinvigorated the two core weeks of the holiday selling season.

Meanwhile, while revenue increased, unit sales — which indicate consumer demand — tell a different story. In the first nine weeks of the fourth quarter unit sales are down 4% from 2020, according to NPD.

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The industry-wide average selling price is up, which the Port Washington, N.Y.-based research group contends is due in part to demand for quality and performance, component and shipping costs, lower promotional levels, and industry-wide choices to focus production resources on higher price point goods.

“Consumers are embracing a different kind of value, as they look to invest in higher-end, better-quality products,” Marshal Cohen, chief retail industry advisor for NPD, said in a statement.

NPD said that among product categories, the surprise thus far has been virtual reality. During Cyber Week, VR/AR saw revenue growth of 84%, and unit volume more than doubled.

record-high selling prices for TVs resulted in record-breaking revenue during Cyber Week. Headphones continued their strong holiday quarter with a 7% revenue increase.

“Cyber Week 2021 followed a similar pattern to pre-pandemic years, demonstrating that the lack of a post-Black Friday lull in 2020 truly was an aberration,” Cohen said. “High-momentum categories are starting to show some vulnerability, which is understandable given the headwinds at play. However, these categories may still show up with late holiday shoppers looking to take advantage of last-minute deals during the full week of shopping after Super Saturday on this year’s calendar.”

LG: New TV Models Feature Increased Style, Function

LG Electronics USA at CES 2022 will unveil its Lifestyle TV lineup “conceived and developed for today’s home-centric way of life,” according to the company.

“LG’s Lifestyle TVs can help transform a home into an office, gym, gallery, workshop or entertainment center, all while elevating the decor and making everyday living more enjoyable,” according to a company press release.

The lineup includes the LG Objet TV (model 65Art90) and LG StanbyME (model 27Art10), “two innovations that eschew conventional display design,” according to the company.

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Resembling a canvas, the LG Objet TV has a minimalist style and neutral colors. The TV includes an LG Remote that raises or lowers a fabric cover as the viewer sees fit. Viewers can lower the cover to reveal the full extent of the screen or partially cover the display to only see a curated selection of lifestyle functions. “Full View” mode reveals LG Objet TV’s 65-inch OLED evo panel. In addition to an advanced processor, the TV also has an 80W, 4.2-channel sound system. When set to “Line View,” the TV features the date and a clock, transforms into an audio player in “Music” setting or displays a collection of exclusive space and nature-themed images when set to “Gallery.”

The interchangeable fabric cover is a product of Danish textile company Kvadrat. The three available colors — Kvadrat Beige, Kvadrat Redwood, Kvadrat Green — have all been carefully selected for their ability to match a wide color palette and blend in with a range of interior designs, according to LG.

The TV is designed to be positioned against a wall at an angle of up to five degrees. The TV’s in-cable frame system allows viewers to connect external devices such as a cable set-top box or game console. It can also be installed flush to the wall.

LG StanbyME

The LG StanbyME is a wireless private TV screen with a built-in battery attached to a moveable stand with concealed wheels that allows for three hours of viewing before recharging. LG StanbyME, featuring a 27-inch display, can be moved from room to room. The screen can be swiveled, tilted and rotated while in both landscape and portrait orientation. The height can be adjusted, allowing the viewer to customize the position according to the usage scenario. Mobile Screen Mirroring works with Android and iOS smartphones and NFC. A removable cradle lets the viewer place a phone on top of the LG StanbyME for video calls, online classes and streaming content. Users can also connect their laptops or PCs to StanbyME via a wired (USB, HDMI) or wireless connection. Control options include remote, touch and gesture recognition. The TV includes a rear cover clad in a textural fabric and finished in an exclusive “Pure Beige” color, according to the release. When not being used as a TV, LG StanbyME can display artworks, photos or a calendar with clock.

LG Creating Physical and Virtual Experience at CES

CES exhibitor LG Electronics will create a physical and virtual experience at its booth during CES 2022, taking place Jan. 5-8.

At its traditional location — the 22,000-square-foot booth at the main entrance to the Central Hall in the Las Vegas Convention Center — LG will connect visitors from the physical space to LG’s virtual experience leveraging both virtual and augmented reality. Constructed of upcycled, recycled and recyclable materials, the space will feature a series of kiosks where visitors can experience LG products.

Visitors will take a self-guided tour using QR codes as they navigate through the physical experience, interacting with LG consumer electronics and home appliance products via AR. Other kiosks will feature immersive VR digital art, including LG’s immersive curved OLED video walls.

Audiences around the world will be able to access the same content and participate digitally in the LG CES experience.

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LG has again been named official CES technology partner for the press rooms and member lounges, which will feature LG OLED TVs.

“We look forward to seeing what LG, a long-time innovation leader at CES, has in store for visitors in January,” Karen Chupka, EVP of CES at the Consumer Technology Association, said in a statement. “CES 2022 will enable attendees in Las Vegas to experience LG’s technology using AR and VR. Audience joining CES digitally from across the globe will be able to experience the same ground- breaking tech, through LG’s digital activation.”

Analyst: Black Friday No Longer a Single-Day Event

With one initial report (Adobe) suggesting the Black Friday retail weekend saw a slowdown in total sales, official data across the long holiday weekend remains forthcoming.

One analyst contends the annual post-Thanksgiving event has expanded beyond a few days to encompass weeks, before and after the third Thursday in November. Wedbush Securities analyst Michael Pachter made a return to in-store surveillance following last year’s pandemic and found consumers increasingly shop online while still frequenting stores.

Indeed, the Black Friday weekend concludes following today’s Cyber Monday event, so coined by the National Retail Federation in 2005 as a way of promoting e-commerce. The day has now become an industry record-setter. Last year’s Cyber Monday (Nov. 30, 2020) was the biggest online shopping day in U.S. history with more than $10.7 billion spent on e-commerce. 

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“Consumers still come out on Black Friday, but they are increasingly
shopping online, particularly for consumer electronics,” Pachter wrote in a Nov. 29 note.

That said, Pachter and his team still found value assessing inventory levels ahead of Black Friday at retail, while continuing to track the depth of Black Friday deals vs. prior years both online and in stores.

Best Buy, the nation’s largest consumer electronics retail store chain, took precautions against supply chain issues to keep stores well-stocked with video games, connected TVs, and streaming media devices heading into Black Friday, according to Pachter.

“We were surprised at the how little appeared to have sold through
at big box retailers within gaming and PC peripherals this year,” he wrote.

The analyst contends that as consumers increasingly shop online, retail store inventories of select CE items remained slim compared to previous years.

“Sellthrough appeared strong for CTVs and Roku players,” Pachter wrote. “In the stores we checked, Roku players were in high demand, particularly the lower-end models and particularly the discounted 4K streaming stick.”

Roku sells its players at a steep discount in order to drive user growth, especially on its platform and The Roku Channel ad-supported streaming service. Indeed, the company marketed a $15 streaming device on Black Friday.

“We think the pandemic era accelerated direct-to-consumer selling,” Pachter wrote. “Our covered companies are all in the early stages of this, but may benefit as the gross margin upside from direct sales offsets some of the pressure from higher shipping costs this year.”

CES 2022 to Have Smaller Footprint, Fewer Attendees

The Las Vegas CES taking place Jan. 5-8, 2022, will have a smaller footprint than shows before the pandemic, organizers said in a Nov. 18 presentation to press.

CES, which was virtual in 2021, in 2022 will not be using the South Hall of the convention center, and Gary Shapiro, president and CEO of the Consumer Technology Association, noted that the aisles will be wider.

“It’s going to have a smaller footprint, and we’ll have fewer people,” he said, adding “we recognize it’s a different year this year.”

CES has tallied 1,700 exhibitors and “tens of thousands” of registered attendees, Shapiro said of the show that attracted 170,000 attendees pre-pandemic. About one-third of the 2022 registrants are international, he noted.

“The people that are coming are serious buyers, serious press,” he said.

Floor plans will be coming out at the end of November, organizers said.

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In the home entertainment space, exhibitors will include TCL, LG Electronics, Samsung, Sony, Hisense, Amazon and Google, organizers said. Among exhibitors participating in the C-Space are NBCUniversal, Discovery, WarnerMedia and Snap.

The show will include three new categories: food technology (such as plant-based food), space tech, and NFTs (non-fungible tokens) and digital currency, according to Karen Chupka, EVP of CES for the CTA. Autograph in the NFT space is one of the exhibitors.

Another highlight is an autonomous race car competition.

Safety protocols for the in-person show include proof of vaccination, with all vaccinations approved by the FDA or WHO accepted (similarly to requirements for those traveling into the United States). Organizers noted that protocols in Las Vegas currently require masks indoors. They said they will release mask guidelines in December and expect to have social distancing measures in place.

The show is available to those who want to participate virtually as well, via live streaming and on demand. The on-demand features will be available through the end of January. Registration for the digital-only component starts Dec. 9.

The virtual experience is here to say, organizers said. “I think there will always be some digital component to CES,” said Chupka.

Nevertheless, Shapiro declared, “Live events are back!”

“It’s simply enjoyable for people to be together,” he said.

Parks: U.S. Consumer Adoption of Smart-TVs Reached 56% in 2021

The use of internet-connected televisions in the home continues to grow, with 56% of U.S. broadband homes now using smart-TVs, according to new data from Parks Associates. Smart speakers/display penetration reached 53%.

Dallas-based Parks found that 82% of domestic broadband households subscribe to at least one over-the-top video service, up 6%, while 58% of households subscribe to a traditional pay-TV service, down 4% year-over-year.

“2021 has been a challenging year for consumers and businesses. While supply chain issues continue to be a concern, there is slow but steady growth in the smart home industry,” Elizabeth Parks said in a statement.

Parks said the percentage of domestic broadband households with standalone broadband service increased from 33% in Q1 2018 to 41% in Q1 2021, following the declining popularity of pay-TV bundles. Consumers pay $64 per month on average for standalone broadband service, up from $39 per broadband household in 2011, a 64% growth rate.

“Traditional and disruptive players continue to introduce new products, grow partnerships, and add features to expand offerings,” Parks said. “Privacy issues continue to be in the forefront of consumers’ minds as well as the ability of products to work together and with a unified app.”

Roku Ups Q3 Accounts, Streaming Hours Despite Soft Hardware Sales

Roku Nov. 3 said it ended the third quarter (Sept. 30) with 56.4 million active accounts, which was up 23% from 46 million accounts in the previous-year period. Streaming hours topped 18 billion, which was 21% above the 14.8 billion hours streamed at this point a year ago.

The subscription streaming video co-founder (with Netflix) attributed the lower-than-projected 1.3 million active user increase from Q2 due ongoing supply issues related to the pandemic.

“We believe that the slowdown in active account growth rate
this quarter was, in large part, attributable to global supply chain disruptions that have impacted the U.S. TV market,” Roku CEO Anthony Wood and CFO Steve Louden co-wrote in the shareholder letter.

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Specifically, the executives said overall U.S. TV sales fell below pre-COVID 2019 levels, a reality that sent Roku shares down more than 9% in after-market trading.

“Some of our Roku TV OEM partners were hit particularly hard with inventory challenges, which negatively impacted their unit sales figures and market share in Q3,” they wrote.

Meanwhile, The Roku Channel increased its licensed content to more than 200 partners, and added 17 linear channels. The ad-supported streaming video platform announced its first Roku original feature-length film, Zoey’s Extraordinary Christmas, in addition to premiering 23 original titles.

“We acquired ‘This Old House’ in March, and it is a good demonstration of The Roku Channel flywheel,” Wood and Louden wrote. “By combining our first-party viewer insights with our recommendation capabilities, we grew streaming hours of This Old House by nearly 50% since our acquisition.”

Success of the catalog show prompted Roku to add 13 new episodes to the upcoming seasons of both “This Old House” and “Ask This Old House,” and launched two new “This Old House” branded streaming channels.

Separately, “Roku Recommends,” the 15-minute weekly program that recommends films and TV shows to platform viewers, has been one of the top VOD series on the Roku Channel, according to Wood and Louden.

“The global shift to TV streaming remains intact,” they wrote. Our platform monetization was strong, even with the outperformance in the prior Q3, and we remain well-positioned for the long term.”