Consumer spending on technology drops

First decline since 2008 according to most recent GfK Temax index

Consumer spending on technology goods has fallen for the first time since mid-2008, according to the latest results of the GfK TEMAX index.

For the three months to 31 March consumer spending dipped 1.6 per cent but the IT sector rose 5.6 per cent driven by back to school and desktop PC sales (up 15 per cent).

Other rises were seen in sales of storage devices (13 per cent) and multi-function printers (2 per cent).

Notably, sales of notebooks fell year on year by 4.1 per cent with over 60 per cent of all devices sold going for a price tag of less than $1000.

Consumer electronics dropped fell by 2.2 per cent on the back of double digit declines across the board except for flat panel TVs (up by 3 per cent).

In the telecoms sector, mobile phones fell by 45 per cent but was countered by continued strong growth in smartphones (up 149 per cent).

”The extent to which the government stimulus packages, coupled with extremely low interest rates, affected 2009’s consumer splurge on technical goods, seems to have been under-estimated,“ the GfK report reads.

"Despite the increasing ‘must-have’ nature of technical goods, it is unlikely that spend in quarter 2, 2010, will be able to surpass that of 2009, particularly as retailers continue to battle it out with pricing and promotional activity. Renewed nervousness regarding the global economy will also play its part.“

In February, GfK said consumer spending on technology goods surpassed the $19 billion mark in 2009.

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Tags businessIT spending

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