Spying on Santa's workshop: What the channel can learn

Gone are the days when business technology resellers could watch the annual consumer electronics saturnalia from afar, says Chris Gonsalves

It's Halloween week, and we all know what that means. Just a few days until the Christmas trees and pine wreaths take over the lawn and garden section at our favorite big-box retailer.

As the world gears up for yet another holiday shopping orgy, it's never been more important for the channel to tune into the habits and desires of this massing army of conspicuous consumers.

By most US accounts, this season is going to provide a bumpy ride.

According to the Consumer Electronics Association (CEA) over here, spending on consumer electronics will rise a modest 2.6 per cent this holiday season, down from four per cent last year.

Undercutting that number is the sobering fact that, on average, American shoppers plan to spend $1,431 on tech gear in 2013, a 12 per cent decline from a year ago.

That drop is being masked by an increasing number of consumers in the market, with 74 per cent of shoppers saying they plan to purchase consumer electronics as gifts this year and they are allocating 33 per cent of their holiday budgets to gadget purchases, the CEA found.

Interesting to note that in addition to economic and financial concerns, 67 per cent of shoppers planning to spend less this year cite already having what they need or want as their reason for reducing CE spending.

"Negative economic sentiment and slipping momentum have consumers cautious about overall spending this holiday, but recent agreements, albeit temporary, should improve consumer confidence toward spending for the duration of the year," said Shawn DuBravac, CEA's chief economist and senior director of research.

"Moreover, holiday tech spending will remain somewhat impervious with recent and forthcoming product announcements to buoy excitement within the tech categories driving growth this holiday season."

So just what will they be buying with all that buoyed excitement?

Tablets, smartphones and laptop PCs make a strong showing in the CEA survey, which also indicates accessories like headphones, earbuds and device cases are on shoppers' minds and gift lists.

About one in five (19 per cent) of the US consumers surveyed plan to purchase an emerging tech device this year, with fitness watches, wearable body monitors and smart scales topping the list. Another 19 percent expect to purchase a next-generation console video game console.

"Mobile connected devices are driving overall tech industry growth and holiday gift sales will be no different," said DuBravac. "Expect to also see growing awareness of emerging tech categories, including health and fitness technology. These are the products quickly moving into the mainstream in the coming years."

DuBravac's big-picture connection is spot on. Gone are the days when business technology resellers could watch the annual consumer electronics saturnalia from afar with detachment. It used to take years for these consumer trends to filter into enterprise computing. But the BYOD craze and the consumerisation of IT has changed all that.

Most of the devices that end up under the tree this year will be headed to the workplace come 2 January. Consumers are overtly expressing their desires for technology functionality and style in their holiday shopping choices; they have great influence on future IT imperatives.

Consider how these consumerisation trends have rocked our IT world already. Shops that once survived on a steady standardised diet of Windows support are now wrestling to handle devices of every size and stripe running OSes from Apple, Google, Blackberry, Microsoft and more. Where did all these things come from and how did they get into the office?

Santa brought them. And so he will again this year, even if his sack of goodies is a little lighter this season.

Consumers are our crystal ball and based on their buying habits, we already know that form-factor style, functionality and price trump brand or platform loyalty.
Tech providers and IT managers would be wise to take a hard look at the personal retail choices consumers are making and start to work those into the planning and implementation of their IT infrastructure and services.

Chris Gonsalves is vice president of editorial at Channelnomics

As part of our special editorial partnership, CRN is republishing this article from Channelnomics