Economic Fears Hurting Consumer Electronics Sales?

from the holding-off dept

With inflation a problem, and various economic fears worrying many Americans, it appears that consumer electronics sales may suffer. People who are worried about the economy are realizing that many consumer electronics purchases really are “nice to haves” rather than “need to haves.” And, if they are making purchases, they’re purchasing lower end models, with folks noting that they don’t want to spend much above $200 on a single device. Good timing for Apple, which just released that $199 iPhone.

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Comments on “Economic Fears Hurting Consumer Electronics Sales?”

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Twinrova says:

Fear isn't hurting anything. Prices are.

Company: “Here. Buy our product. It good. Make you happy.”
Consumer: “How much?”
Company: “That not matter. Buy.”
Consumer: “Not until I know how much.”
Company: “Okay. Buy for $1000 USD. You be happy.”
Consumer: “Sure, okay. That sounds great and I’ll be the first on my block to buy it!”


Idiot: “Yo, neighbor. Check what I got. It’s a fandangle, top-o’-the-line, multitasking, Red-Ray DVGRCDMP3 player.”
Neighbor: “Cool. What’s it do?”
Idiot: *describes*
Neighbor: “How much?”
Idiot: “That’s the best thing! We get all this for $1000!”
Neighbor: “Great! Where’d you get it?”
Neighbor 2: “Hi guys. Check what I just got. It’s a Red-Ray DVGRCDMP3 player.”
Idiot: “Nice! I just got mine today!”
Neighbor: “I was about to get one. Your brand is different. How much was yours?”
Neighbor 2: “Only $200. Sweet, eh? The price just dropped today. Another is scheduled tomorrow.”

And that, my friends, is what’s going on in the electronics world. Consumers are pretty pissed of spending $$$ on stuff only to see the price drop within months. So, if you’re into selling electronics to consumers, it’s best you start with a friendly price rather than trying to cater to the 1% of idiots who will buy it at full price, but regret their decision later.

Kind of what Apple just did with the new iPhone. Of course, if they were smart enough to use a better model in the first place, not restrict the content provider, and open up the market better, they may not have needed to drop the price of this new version.

But Apple will win in the end because while the price of the phone is cheaper, the plan to carry it increased by $10/mo. while still selling a phone that didn’t cost $199 to make.

Rory Turf (user link) says:

I completely agree. People’s paycheck doesn’t stretch as far so things like new gadgets are the first things to go. If you’ve got a big fuel bill coming up or you’re paying more and more for petrol of course you’re going to cut down elsewhere. Even lowering the prices of gadgets like the iPhone doesn’t change the fact that it’s a $199-dollar toy.

MattyFo says:

This is inaccurate

I work for a top distributor of all of these parts and I have to say this article is mostly FUD.

Prices on these products were already on their way down. For instance some of those Canon cameras are revisions to last years lines that were already low priced.

Sandisk Mp3 players are cheap because the price of memory got ultra competitive last summer and prices are still being driven down, and fast!

Blu-Ray players are finally getting cheap because they are selling (surprise). This is not because retailers are pushing pricing down but because the second revision of products are coming out and production has ramped up the prices have dropped.

I should know, I work between all of these vendors and my customers. Too bad the Baltiomore Sun was relying on mostly anecdotal evidence.

PS and yes computers are mostly recession proof but they are also insanely low margin. Hard drives, processors and ram may as well be considered commodities at this point.

Joshua Bova (profile) says:

By inaccurate do you mean "accurate"?

I own a home theater / electronics sales and installation company. We focus on the high-end and fortunately have the market here in east-central NJ to support it. But my walk-in and mid-level business has begun shrinking. I don’t sell Vizio or Maxcent or any of the other crap that the Price Clubs sell, and like the article says, people if they do decide they’ll spend, are spending less.

There is however a caveat, the people who are benefiting from this economic climate, namely commodities traders etc. are spending HUGE. My high-end+ business has grown significantly, we have done more large scale work than ever this year.

Just like the gap between the impoverished and the wealthy gets bigger every day, so does the difference in their toys…


BRADLEY STEWART (profile) says:


It happens to me every time that I buy a new computer. Six months after I have it all set up and and working fine something new comes out and Jeez Louise its time for an expensive upgrade or sulk because I haven’t done it. I don’t even need the upgrade. In most cases even if I do upgrade the thing none of the software that I need will run on the thing or if it does I notice almost no difference in its operation. This brings me to another point. Cell Phones. Not only don’t I own one, I don’t even want one. What is it with people who need a new upgraded cell phone every year. For crying out loud its a telephone! I do undersand why some people want and do need them but really who needs all the features that these things offer. Its not like that these companys are exactly giving these things away either. I will just leave you all with what I have distilled the average cell phone call made in the United States down to. Party one sitting on a bus heres their cell phone ring. They answer it. Hello! Silence. Reply. Im on the bus and I will be there when I get there. Now this is worth signing another long term contract for aside from another couple hundred bucks for the new model!

shopping_addicts (user link) says:


I agree with Bradley. See the electronics companies rely on Americans to be morons. People have no real purpose for purchasing these dumb electronics, but for some reason they cannot hold their screws tight enough to grasp that fact. Like the Iphone. If you have an IPhone you don’t need another phone for the next 10-20 years. As a matter of a fact you don’t need a phone, computer, gps system, or any of that for the next 10-20 years. But hey, its sweet song singing to those registers ringing.

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