Consumer Electronics Take the Tech Cake

Were personal video recorders, DVD players, and home theaters, just too much for the old PC and its friends? Revenue from computer-product sales turned negative about halfway through 2000, while consumer electronics saw a slowdown, but no negative revenue consequences, according to NPD Group.

NPD INTELECT® found that sales for 45 computer-related categories it tracked rose 14.1 percent in unit terms, but fell 6.3 percent in dollars in the year 2000, compared to 1999. Sales for a group of 47 consumer electronics rose 7.1 percent in terms of unit terms and 5.1 percent in terms of dollars.

Overall, unit sales of computer-related products continues to increase throughout 2000 despite several categories that were in steep decline, particularly desktop PCs, which dropped 17.6 percent in units. Percent change over the four quarters of 2000, compared to those in 1999, showed a sequential decline in unit growth. Overall, technology sales in first quarter 2000 increased 19.4 percent in unit terms compared to first quarter 1999. By the fourth quarter 2000, technology sales increases slowed to 9 percent in units, compared to fourth quarter 1999, 10.4 percent less growth than first quarter 2000. Notably, revenues turned negative beginning in the second quarter, plunging further as the year continued.

Sales in the consumer electronics segment followed the same trajectory, NPD found, but without the negative revenue consequences. While unit sales of consumer electronics increased through each quarter of 2000, the first half of the year was significantly stronger than the second half, in both unit and dollar terms.

“The softening economy is clearly evident in the numbers for both computer-related and consumer electronics products,” said NPD INTELECT Director of Consumer Electronics Jim Hirschberg. “Still, in both groups of products there were bright spots. This is a time when hot new digital products are attractive to consumers in spite of their concerns over the economy. From PDAs to portable DVD players, digital categories tended to fare well all year long.”

According to NPD, some of the fastest growing computer-related categories in year 2000 were home networking products (300 percent), PDAs (161 percent), and CD recordable drives (83.2 percent). Some key categories that decreased in unit sales were beyond the aforementioned desktop PCs, include monitors (-7.0 percent), notebooks (-1.6 percent), and printers (-1.1 percent). On the consumer electronics front, there was vigorous growth for DVD players (108.3 percent), home CD recorders (70.3 percent), direct broadcast satellite (57.6 percent), in-dash CD players (42.6 percent), and home theater-in-a-box systems (37.9 percent).

Computer/Consumer Electronics Sales, 1999 vs. 2000
Quarters Computer-Related Consumer Electronics
Percent Change
in Units
Percent Change
in Dollars
Percent Change
in Units
Percent Change
in Dollars
Q1 1999 vs. Q1 2000 19.4% 0.8% 8.9% 9.1%
Q2 1999 vs. Q2 2000 17.6% -1.3% 12.0% 10.2%
Q3 1999 vs. Q3 2000 13.4% -5.6% 6.5% 3.4%
Q4 1999 vs. Q4 2000 9.0% -6.8% 5.7% 2.2%

Related reading