Strategy in TECH...
This past Sunday, on the eve of this week’s launch of the Consumer Electronics Show (CES) 2025, the Consumer Technology Association (CTA) released updated projections for total Tech industry sales in the year, as is its custom. According to the trade association, total Tech industry sales are expected to reach $537 billion – the highest level in history.
When most of us think about the Fed (the Federal Reserve Board), we think about Chairman Jerome Powell setting bank rates that can have a major impact on the U.S. economy. But what you may not know is that the Fed is a prodigious monitor and relayer of economic data. New data points have come to my attention that show increasing pressure as consumer debt levels and delinquency rates continue to rise – a condition impacting the everyday average American consumer. I felt compelled to share this data with you so you can begin tracking it on your radar screens as well.
The Nikkei is reporting a robust revival in Japan of sales of prerecorded analog cassette tapes, a format once thought dead and gone. Now, the report says, the humble cassette tape “is experiencing a renaissance, charming a new generation of music enthusiasts with its nostalgic appearance and distinctly warm and rich sound.”
NOTE: Scroll down for a brief update – The latest economic data showing lower inflation appears to be finally registering with consumers as the latest preliminary reading of the University of Michigan Index of Consumer Sentiment jumped more than a massive 13% in just one month. This took the index to its highest reading in two-and-a-half years (since July 2021).
A new study recently released by TiVo Platform Technologies (TiVo) – a subsidiary of Xperi, Inc. – called Smart TVs Paving the Way quantifies a marked shift in trends in consumer consumption of streaming entertainment – as well as spending on streaming services. Top findings noted a decline in both the number of services to which consumers subscribe and the amount of money they spend monthly to obtain such services.
Yet, the same study showed an increase in consumers’ average daily consumption of streaming entertainment content.
Chalk this up to good economic news! Yesterday, the latest Consumer Price Index (CPI) reading for the year through June shows that inflation continues to moderate, coming in at a reading of just 3% growth. That is well off the reading of 4% through May and much better than economists had anticipated.
But it is not yet time to open the champagne just yet, as we are likely to have another interest rate increase from the Federal Reserve Board (the Fed) later this month, and perhaps yet another one before the end of 2023 as they try to manhandle inflation down to their 2% target rate.
In the latest data on consumer confidence, The Conference Board reports a positive, if only “slightly” so (their words), uptick in consumer confidence readings in March as compared to the sentiment in February. The organization’s Consumer Confidence Index (CCI), a widely followed read on how consumers are feeling about both existing and upcoming business conditions, is an important indicator of potential economic activity.
By now, data clearly shows that vinyl record sales here in the U.S. have been growing steadily for more than a decade. When initially detected, many thought it was simply a fad… They thought that at first CDs…and then digital downloads…and finally digital streaming would supplant vinyl. Now we know that is just not the case and that vinyl is continuing to grow in importance again to the music industry.
Think this is just a U.S. phenomenon? Think again! A report by the Nikkei in Japan notes the dramatic growth of vinyl sales there, as well.
Even though consumers report rising financial insecurity as inflation rages on, the Fed keeps raising interest rates, and the economy begins to slow, they say they intend to continue to prioritize spending on health and wellness – a new priority since the onslaught of COVID-19 – according to new research from Accenture. This is potentially good news as more in the custom integration industry look to offer various residential health and wellness solutions as part of a whole-home residential or commercial installation.
After 70+ days of declining gas prices and news that inflation has peaked, consumers are feeling a little bit better about things. And that is especially true of wealthier consumers, according to the latest reading from the Morning Consult/Axios Inequality Index – which includes consumer sentiment information broken down by income level.
