Winter warmer for shoppers
07 December 2009
Will Christmas come to the rescue of the electronics industry after a miserable 2009 Whatever I write in this week’s column will have no reference to any cultural, theological, traditional or even moral aspects of Christmas and its importance to Christians across the globe.
These are hugely important issues for some, but an electronics industry newsletter is not the place to discuss them, so please accept my apologies to anyone offended by my completely commercial take on Christmas.
So how important is Christmas, and most particularly this Christmas, to the electronics industry? Perversely I think that the answer to this is probably that it is getting less important as a single event the more commercial it gets. There has been a trend over recent years, for example, for people to give their loved ones money, instead of particular gifts, so that they can go and spend it more prudently in the January sales.
The ‘January Sales’ – which in my youth was no more than a week or two of clearing old stock – now starts on Christmas Day and goes on for months, usually until the Spring sales start.
In an effort to cash in on the still very substantial remains of the Christmas effect, and also to counter the twin attack of competition from online stores and continued fragility of consumer confidence, retailers have started discounting heavily in November and December. The economy has made this effect more obvious but it is a growing trend for many years.
The upshot is that instead of having a Christmas effect we have a winter season, which handily coincides with other major celebrations around the world, like the Chinese New Year for example. So if we accept that we are all going to give each other presents around the time when it gets a bit colder in the Northern Hemisphere, have we now reached the point where Christmas (or New Year etc) has done its job as consumer catalyst but its significance has since waned?
If the above hypothesis is true, and the quantity of presents given remains fundamentally constant but conveniently (from a manufacturing perspective) spread out over a longer time, the electronics industry’s fortunes will therefore be determined by how good the national and international economies are, and how innovative it can be.
The first of these is the most pressing one at the moment. Nearly every major economy has dragged itself out of recession and early reports are that pre-Christmas shopping volumes are up by a percentage point or two from the same time in 2008 across Europe, even in the UK which is still, officially at least, in recession. The season got off to a promising start in the US too as shoppers came out during the ‘Black Friday’ holiday weekend in greater numbers than the year before (Black Friday, for those not aware, is the ‘dead’ day between Thanksgiving and the weekend which most people in the US take off as vacation). So it seems that the enthusiasm and money is there – but is the spending going to be on electronics goods? All I can offer is that my wife wants a phone, my son wants an X-Box and my daughter wants a particular pair of boots – so I can scientifically say that 67% of the Christmas market is in electronics!
Maybe by being a bit more innovation the electronics industry could come up with something better than a pair of boots to capture my daughter’s imagination (she has a phone and an iPod and that is all she needs), but I think it is probably quite healthy that girls like clothes!
Contact Details and Archive...
Most Viewed Articles...