In 2017 the technology industry will return to growth for the first time since 2010, according to a new forecast from The NPD Group. Sales of mainstream technology products will stabilize, while new dollars from innovative products will help grow the market.
Global information company, The NPD Group, shared insights from a new, 24-month technology industry forecast, predicting a return to growth for the U.S. market in 2017 for the first time since 2010. Covering over 100 technology categories, NPD is forecasting a nearly two percent increase in technology industry sales in 2017 versus 2016.
“This is our first-ever 24-month tech industry forecast and what better time to share insights than the kick-off of the 2017 Consumer Electronics Show,” said Ian Hamilton, President, Technology Sector, The NPD Group. “Our forecast, which combines point-of-sale data, consumer information, and industry expertise, suggests that 2017 will be a year of growth for the tech industry. We’re excited to offer our insights to companies across the industry to help them maximize their potential.”
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NPD expects three key drivers—innovation, meaningful product refreshes, and aggressive pricing—to add the most dollars in sales in the forecast period.
“We expect to see growth overall in large volume mainstream categories such as TVs and PCs driven by demand for premium products,” added Stephen Baker, vice president, industry analyst at NPD. “That said, we have seen and expect to continue to see, categories based on exciting, innovative technology, such as drones, home automation products and virtual reality, accounting for a growing percentage of industry sales.”
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Drone and Home Automation Sales Will Takeoff
With a growing number of drones available at a wider variety of locations, NPD expects U.S. sales dollars of drones to grow 177 percent from 2016 to 2018. Hobby drones are expected to drive much of the volume, as there will be a balance of demand and relatively high average sale prices.
Additionally, the next two years will see a broadening appeal of smart home devices to a more mass market, non-enthusiast group of consumers. This category is expected to grow 90 percent from 2016 to 2018, driven by sales of security & monitoring products, as well as growth in power & sensors and home automation kits.
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“Increases in distribution and the number of product SKUs are major contributors to the growth we expect to see in newer categories, as they work to fit the ever evolving needs of the consumer,” said Ben Arnold, executive director, industry analyst for The NPD Group. “Continued innovation will also be crucial, as features like voice control will have a big impact on these categories moving forward.”