CTA: Tech To Boost Holiday Spending Growth

New technology including smart home devices and wearables will help drive consumer electronics sales up by about 3.1% to $36.05 billion this holiday season, according to a projection from the Consumer Technology Association.

More consumers in the U.S. plan to purchase tech gifts for this holiday season, CTA reported. All told, about 170 million consumers will shop the consumer electronics category during this year’s holiday season, up 6% from the 2015 period. As a proportion, 68% of U.S. consumers plan to shop for technology this holiday season, CTA stated, adding that 27% already plan to buy wearables, 24% plan to buy smart home devices and 9% plan to buy drones. In other categories drawing purchase intentions, 11% of consumers intend to buy connected or digital toys, and 10% intend to buy VR headsets.

Under the wearables segment, 17% of consumers plan to purchase smart watches, according to the CTA study, and 15% plan to purchase fitness trackers. Under the smart home device segment, 10% of consumers plan to buy smart thermostats and 6% plan to buy digital assistants such as Amazon’s Echo. Still, CTA pointed out that that it expects headphones to be the most popular tech gift given this year, with 40% of consumers expressing interest. A tech industry movement toward wireless audio devices will drive headphone sales, CTA suggested.

CTA’s study suggested that 57% of consumers are likely to shop for tech online this year, up two percentage points from the 2015 holiday season. Brick and mortar stores remain the main focus of tech gift purchases, as 74% of consumers said they are likely to purchase from a brick-and-mortar location over the holidays, but that figure is down three percentage points from last year.

Overall, CTA maintained that its consumer research regarding the November and December holiday season indicated that spending, excluding gas and restaurant purchases, should increase by 3.8% to $824.8 billion year over year, with online sales up 16.4% to $84.2 billion. CTA anticipates that sales through mobile devices such as smartphones and tablets will grow 45.2% to $20.1 billion.

“The 2016 holiday season looks to be the biggest on record for the tech sector, thanks to fresh and innovative products on the market such as wearable tech, VR headsets, drones and digital assistant devices,” said Shawn DuBravac, CTA chief economist. “Our research also finds that most Americans are now using tech devices to help them research and buy those tech gifts.”