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Back-to-School : Boom-time for technology sales?
Growth of notebook PC retail sales, generally one of the biggest drivers for back-to-school, has begun to slow, shown by NPD's weekly point-of-sale data. And this trend isn't limited to just notebook computers, which top many students' back-to-school shopping lists. Other consumer technology categories (IT, imaging, audio, video, and consumables) are experiencing similarly slowing growth rates.
Notebook sales for the first seven weeks of this year's back-to-school season (July 15 through September 1) were up 27 percent in units and 13 percent in dollars, while the average selling price (ASP) was down 11 percent. During the same time period in 2006, notebook sales experienced a 51 percent increase in units and an 18 percent increase in dollars, with the ASP down 22 percent. Desktop sales, similar to trends seen all year, were down 22 percent in units and 16 percent in dollars in 2007. ASP was up 7 percent.
“Notebook sales have exhibited strong growth the past few years, but you can only keep that 50 percent-plus growth going for so long,” said Stephen Baker, vice president, industry analysis. “We’ve hit a ceiling across most major categories; economic issues, market saturation, and changes in consumers’ shopping habits have had an impact on sales. Price is also a factor. ASPs aren’t coming down as fast as in prior years, and even though consumers still have the ability to get a great deal, they are less inclined to buy a new notebook PC to replace last year’s model because the deals aren’t as enticing.”
Promotions Play a Part
Marketing moves among retailers have put a crimp in back-to-school notebook sales. Notebook PC promotions were up only 13 percent for the first seven weeks of the 2007 season compared to the 38 percent increase seen in 2006, according to Fusion data. Promotional activity for both notebooks and desktops only increased 5 percent this year compared to the 32 percent increase seen for total PCs in 2006.
Consumers may have also encountered fewer notebooks and desktops on the shelves as they started their back-to-school shopping. During the first seven weeks of the 2007 back-to-school season, notebook shelf space increased less than one percent over 2006, but that’s down significantly from 2006, where shelf space had increased 38 percent over 2005. Total PC shelf space actually decreased by 3 percent this year compared to a 38 percent increase in 2006.
“If the products aren’t being marketed and aren’t in consumers’ line of sight on the shelves, that’s definitely going to have an impact on sales,” said Sam Bhavnani, research director, Current Analysis West (an NPD Group company). “Even though last year was the big push for notebooks, the shift in overall PC promotions and shelf space this year compared to last year shows that there are massive swings in marketing PCs at retail. What retailers and manufacturers now need to consider is how the current situation will affect the fourth quarter and the holiday season.”
To learn more about NPD’s weekly POS information for the technology industry, or to find out how NPD data and insights can help you make better business decisions, contact Charlie Camaroto at 866-444-1411 (contactnpd@npd.com).Back to Top