NPD Group Blog » Holiday Sales Results Are Uninspiring, Unless You Remember 2008

Holiday Sales Results Are Uninspiring, Unless You Remember 2008

Tuesday, January 12th, 2010
By Stephen Baker, Vice President, Industry Analysis

NPD’s Weekly Tracking Service showed consumer technology revenue for the 2009 five week holiday period was down slightly less than 1 percent, year-over-year. While that result is far from the halcyon days of the mid-decade, it is a far better performance than 2008’s 6 percent decline. The real highlight though is a tale of two categories, PCs and TVs. PC sales were as strong as we have ever seen, with notebook unit volume up almost 70 percent and desktops (yes, desktops !!!) up nearly 30 percent. TVs, on the other hand, were a drag on revenue growth despite a 30 percent increase in unit volume.

Desktops, along with camcorders, were the two big surprise hit holiday categories. Growth in desktops, while surprising, wasn’t completely out of the blue, since sales have been strong since the release of Windows 7. Notebooks were the best performing big category of 2009 as consumers and retailers have been focused on mobility as a huge growth opportunity. Despite the price deflating impact of netbooks, unit growth throughout 2009, but especially during this holiday season, was more than enough to offset those falling prices to generate positive revenues. Full-size notebooks were mightily impacted by the rise of netbooks with ASPs falling to remain competitive. In fact, this holiday season we saw upwards of 95 percent of all full-size notebooks sell for less than $800.

Camcorder results, driven especially by low-cost flash models under $300, posted unit increases of 50 percent and double-digit revenue increases as well. Increases in distribution, aggressive promotion, and an increase in the brands and SKUs available at retail all played into this impressive result. What makes this more impressive is that camcorders have been a very slow growth category for a number years, characterized by rapid technology changes (tape to DVD to HDD in rapid succession) and the conventional wisdom holds that video on the phone is good enough for most people. Apparently that is not quite accurate.

Televisions were a drag on overall results as, unlike the notebook segment, falling prices failed to spur enough demand to generate positive revenue. Of course that was nothing new for flat-panel sales in 2009 where the vast majority of the monthly results showed negative year-over-year revenue trends. During the holiday season, 32-inch LCD was the clear winner showing growth of more than 50 percent in units and slightly more than 10 percent in revenue. In comparison, larger screens exhibited extremely poor results. Every product type range above 40 inches (with the exception of plasma over 54 inches but including 40-42 inch LCD, 46-47 inch LCD, over 50-inch LCD, 42-inch plasma, and 50-inch plasma) showed year-over-year revenue declines for the holiday season.

All-in-all there just wasn’t a lot to crow about when looking at 2009 holiday results, unless you are comparing to 2008. Then in that case this past holiday season fulfilled all your wishes, hopes, and dreams (and then some).

Share and Enjoy: