The gadgets were hot. Now they are not.


Many companies have been caught off guard by the changes in our spending choices this year. Americans eager to travel and party after two years largely at home are gorging on plane tickets and fancier clothes — and ignoring the patio furniture and slouchy pants we splurged on in 2020.

Consumer electronics may be the fiery center of Americans’ volatile shopping habits. Gadget buying has suddenly gone from hot to not, a change that will most likely bring pain and confusion to many businesses – and potentially good business for people who still want to buy electronics.

In the early months of the pandemic, many of us were so eager to buy internet routers, laptops, video game consoles and other tech gear to stay productive and comfortable at home that some products were not found. However, experts have warned that people will inevitably forgo buying certain types of gadgets until they need them again.

The magnitude of the change after two years of gadget shopping surprised many people. From January to May, electronics and appliance stores were the only retail category for which sales fell compared to the same five months of 2021, according to the Commerce Department. disclosed Last week. Best Buy said last month that purchases at its stores fell across the board, especially for computers and home entertainment, and are likely to stay meh. And research firm IDC expects global smartphone sales decline this year, especially in China.

What’s bad for manufacturers and electronics stores could be good for us, but value hunters will have to be careful. Nathan Burrow, who writes about buy deals for Wirecutter, the New York Times’ product recommendation service, told me that prices for some electronics are already slashed. But a sale when inflation is at its highest level in 40 years in the United States is not always a good deal. A discounted product could still cost more than similar models a few years ago, Burrow said.

The jigsaw in shopping habits has led to Walmart, Target, Gap and some other retail chains ending up with too many wrong types of products. This is also true for certain types of electronics, which means prices are likely to spike during the summer “holidays” at Amazon, Target, Best Buy and Walmart.

Burrow predicts big price drops are coming for tablets, internet networking gear, Amazon devices and some laptops, including Chromebooks.

Research firm NPD Group said this year that consumer electronics sales very likely drop in 2022 and again in 2023 and 2024 – but two previous crazy years of electronics sales would still leave overall sales higher than they were in 2019. Disorienting for gadget makers and sellers.

“It’s the unpredictability that makes everything worse,” said Jitesh Ubrani, research director at IDC.

Making long-term forecasts is difficult for electronics manufacturers, retailers and buyers. Some executives have said global shipping and availability of critical components like computer chips may never be normal in 2019. retailers have become addicted to higher profits from more expensive products.

In the electronics industry, experts tell me there are conversations about how to do things differently to prepare for potential future crises, including further expanding gadget manufacturing to countries outside of the China. It is unclear how our spending might change again in response to inflation, government efforts to calm rising prices, or a possible recession.

For a time, people in wealthy countries have become accustomed to a constant flow of cheap and plentiful electronics, furniture, clothing, and other goods thanks to interconnected global factories and shipping. The pandemic and the madness it has unleashed in supply chains have some economists and executives rethinking the status quo.

It’s possible that the ups and downs in electronics sales since 2020 will sort themselves out in a few years. Or maybe consumer electronics is a microcosm of a pandemic-altered world that may never be quite the same again.

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