Spotlight on Americans 50+

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1 The Evolving Video Landscape April th Annual CE Holiday Purchase Patterns Study September 2012 Spotlight on Americans 50+ Introduction With the holiday season approaching, consumers across the country are beginning to make their holiday wish and gift giving lists. For consumers of all ages, consumer electronic (CE) devices and accessories are often at or near the top of these lists. While American adults age 50 and over are quite similar to younger adults regarding their holiday shopping and spending behaviors, there are a number of distinct differences. It is important for CE device manufacturers and retailers to consider the unique needs and desires of adults age 50 and over because this age segment is sizable in both their numbers and spending power. This AARP sponsored analysis brief examines the results from CEA s 19th Annual Holiday CE Purchase Patterns Study to provide insight into how the 50+ segment of the U.S. population differs from their younger counterparts.* Holiday Spending Nine out of ten 50+ consumers indicate they will purchase holiday gifts this year (89%). The average consumer will allocate $1,300 towards their holiday spending budget. Half of this amount will be spent on gifts with the remaining half devoted to other holiday-related expenses. Not only will these age 50+ Americans purchase CE products as gifts this holiday season, but some will purchase CE for themselves or for their households for personal use, not to be given as gifts. Market Size Over 100 million people ages 50 and over currently reside in the United States. This segment represents nearly one third of the overall US population. This age segment is projected to increase to about 135 million people by 2030 and constitute approximately 37% of the overall US population (a 5% increase). The highest expenditures for this age segment compared to younger age groups include healthcare, personal care, and entertainment. Approximately nine in ten (89%) U.S. adults ages 50+ will be purchasing gifts during the upcoming holiday season which includes the Christmas, Hanukkah and Kwanzaa holidays. Source: U.S. Census Bureau / AARP / CEA Shoppers 50+, on average, expect to spend $1,302 this holiday season, somewhat less than those ($1,676), but still a considerable portion of the total expected holiday spend. Figure 1 Base: U.S. adults (ages 50+ n=436; ages n=537) Q. What is the total amount you will spend this year for the holidays? Try to include all costs, including gifts, food, purchases for the home, decorations, greeting cards, travel expenses, clothes for holiday events, cost of holiday events, etc Consumer Electronics Association (CEA). All rights reserved. research.ce.org 1

2 Half (50%) of the holiday budget for those over age 50, $651, will be devoted to gifts. The remaining 50% will be spent on food (24%), travel (8%), home purchases (5%), decorations (3%), greeting cards (3%) and other general holiday needs/items (7%). Slightly more than half (54%) of those ages 50+ intend to buy a CE product this holiday season. The top recipient of CE gifts will be children as one third (33%) plan to give them a CE gadget. One in five older consumers will purchase CE for themselves (19%) and for a spouse/significant other (21%), while 30% plan to purchase CE for some other adult. When asked how this year s anticipated spending will compare to last year s, 50% of consumers ages 50+ say they expect to spend the same amount of money this holiday season, which is comparable to the 46% seen among year olds. An additional 14% of those 50+ expect to spend more (24% 18-49), while 35% are planning to spend less (29% 18-49). Figure 2 Older consumers who plan on spending less this year cite concerns about the economy (76%) as the top reason for decreased spending, followed by already having what they need or want (68%), not having the money to spend on gifts (66%), increased cost of living (65%), living on a fixed income (64%) and earning less money than last year (53%). Base: U.S. adults (ages 50+ n=436; ages n=537) Q. Compared to LAST YEAR, how much money do you plan to spend on gifts this holiday season? Do you expect to spend... Holiday Gifts Computing products such as tablet computers and notebook or laptop computers top the list of CE products holiday shoppers over age 50 may give this year. In terms of CE accessories, headphones/earbuds, memory cards and carrying cases for electronic devices rise to the top. Gift cards for traditional retailers, restaurants and content/service providers are also likely to be popular gifts given this year by those over age 50. Topping the list of CE products holiday shoppers ages 50+ may give this holiday season are computing products, specifically tablet computers (19%) and notebook or laptop computers (17%). Closely behind on the CE gift giving list are E-readers (15%), iphones (14%), televisions (13%) and external storage devices (13%). Rounding out the top ten are portable MP3 or digital media players, multifunction printers, cell phones that are not smartphones and portable or hand-held GPS devices, all at 11%. Among older consumers looking to gift TVs this holiday season, LED LCD TVs (67%), LCD Flat Panel TVs (66%) and TVs with a screen size larger than 40 inches (63%) are the types most likely to be purchased. Figure 3 CE Product CE Gift Purchase Plans Top 20 CE Products Among Those 50+ % Yes or Maybe CE Product % Yes or Maybe Tablet computer 19% Wireless home network device 10% Notebook or laptop computer 17% Android smartphone (any model) 10% E-reader 15% Dedicated hands-free car kit 10% iphone 14% Portable DVD / Blu-ray Disc player 10% Television (any type) 13% Video game console 10% External storage device 13% Home DVD player or recorder 9% Portable MP3 player 11% Portable gaming device 9% Multi-function printer 11% Home Blu-ray Disc player 9% Cell phone (not a smartphone) 11% Digital point and shoot camera 9% Portable or hand-held GPS device 11% LED LCD TV 9% Q. Which of the following [CATEGORY] products do you expect to buy as gifts during the holiday season? Do you expect to buy 2012 Consumer Electronics Association (CEA). All rights reserved. research.ce.org 2

3 CE accessories will likely be popular gifts this year, as well, with one in five gift givers ages 50+ stating they may give headphones / earbuds (19%), memory cards (19%) or carrying cases for electronic devices (19%). Computer accessories (14%), video game accessories (11%) and Bluetooth headsets (10%) follow close behind on the list of likely CE accessory gifts. Figure 4 CE Accessory Gift Purchase Plans Among Those 50+ CE Accessory % Yes or Maybe Headphones or earbuds 19% Additional memory card 19% Carrying case for any electronic device 19% Computer accessories 14% Any type of video game accessory 11% Bluetooth headset 10% Audio/video connection cables 9% Digital photo frame 9% Kit to connect an MP3 player or ipod to a car stereo 8% Docking station for an MP3 player or ipod with powered speakers 8% Universal remote control 8% Q. Which of the following [CATEGORY] products do you expect to buy as gifts during the holiday season? Do you expect to buy Nearly three quarters (72%) of U.S. adults ages 50+ plan to give gift cards this holiday season. The most popular gift cards are for mass merchants (47%), restaurants (43%) and department stores (35%). One in five (19%) expect to give a gift card for consumer electronics stores. Given the recent consumer uptake of CE devices such as tablets, e- readers and smartphones, there are some age 50+ holiday shoppers considering content and services as potential holiday gifts. One in five (20%) expect to purchase gift cards that can be used for digital music purchases such as through itunes, 18% for electronic book purchases such as for an Amazon Kindle or Nook and 10% for application (apps) purchases for a tablet or smartphone such as through itunes or Google Play. Figure 5 Consumer Holiday Shopping Behaviors Holiday shoppers over age 50 generally anticipate this year s sales and deals to be the same as or better than last year. Newspaper advertisments, circulars or ads in the mail, TV advertisments and friends and family members will be the main sources relied upon by these shoppers for information regarding holiday deals. Return policy and product pricing are the most important criteria among holiday shoppers ages 50+ in terms of deciding where to shop for CE gifts this holiday season with many consumers over the age of 50 indicating they are likely to use the Internet to help them find the best deals while holiday shopping. Despite the popularity of Black Friday and Cyber Monday deals, more than four in ten (44%) older holiday shoppers start their shopping before Thanksgiving, with one in five (20%) who like to get an early start by beginning their holiday shopping in September or earlier. A majority of holiday shoppers ages 50+ anticipate this season s sales and deals to be about the same as last year (61%), with 16% expecting them to be better than last year and another 16% not as good. Q. What types of gift cards do you expect to buy as gifts this year? Would you say Consumer Electronics Association (CEA). All rights reserved. research.ce.org 3

4 Holiday shoppers over age 50 will rely upon newspaper advertisements (73%), circulars or ads in the mail (71%), TV advertisements (68%), friends or family members (68%) and in-store signs or advertisements (62%) to find out about holiday deals. That s not to say, however, that older holiday shoppers will not be turning to the Internet for such information. One third say online advertisements (34%) and notifications (34%) are useful in obtaining sale and deal information, along with 17% for deal of the day sites and 15% for information on social media sites. Return policy (80%) and product pricing (78%) are the most important criteria among holiday shoppers age 50+ in terms of deciding where to shop for CE gifts this holiday season. These are followed by ease of making a purchase (76%), past experiences with retailers (75%), availability of the latest products (69%) and variety of products sold beyond CE (55%). In terms of purchase location, half (51%) of those ages 50+ say they are likely to purchase CE from a mass merchant, while a relatively equal 49% say the same of an electronics store. Conversely, 50+ holiday consumers are much less likely to purchase CE from warehouse club stores (32%) or online merchants (30%). Even if consumers ages 50+ don t plan to gift CE this holiday season, six in ten (61%) are likely to look at electronics products in stores, which translates to the potential opportunity for the older consumer to purchase an unanticipated gift (for themselves or for others). Along those lines, nearly four in ten (37%) older holiday shoppers say they are likely to purchase CE for themselves or their household that will not be given as a gift. Figure 6 44% Total Before Thanksgiving Q. Thinking about your shopping patterns during the holiday season, when do you typically START buying gifts? Figure 7 Q. How do you expect to learn about sales and discounts for the holiday shopping season? 2012 Consumer Electronics Association (CEA). All rights reserved. research.ce.org 4

5 Price is an important factor for consumers ages 50+ and the Internet is making it easier for consumers to educate themselves on when and where to get the best deals. Half (53%) are likely to compare prices on the Internet before making a purchase. Going a step farther, 22% say they are likely to use their cell phone, smartphone or tablet while shopping in store in order to compare prices. An additional 16% will use social networking sites to help them find those stellar deals as they embark upon their holiday shopping. Figure 8 In Summary Nine out of ten 50+ consumers indicate they will purchcase holiday gifts this year, with an average spend of approximalty $1,300 per consumer. Half of this amount will be spent on gifts with the remaining half devoted to other holiday-related expenses CE plays a leading role in holiday shopping among those ages 50+. Computing products such as tablet computers and notebook or laptop computers top the list of CE products holiday shoppers over age 50 may give this year. In terms of CE accessories, headphones or earbuds, memory cards and carrying cases for electronic devices rise to the top. Holiday shoppers over age 50 generally anticipate this year s sales and deals to be the same as or better than last year. Newspaper advertisments, circulars or ads in the mail, TV advertisments and friends and family members will be the main sources relied upon by these shoppers for information regarding holiday deals. Q. Will each of the following be very important, somewhat important or not at all important when deciding WHERE to shop for ELECTRONICS products this holiday season? When it comes to gift giving, pricing is key. In fact, product pricing is one of the most important criteria among holiday shoppers ages 50+ in terms of deciding where to shop for CE gifts this holiday season and many consumers over the age of 50 indicate they are likely to use the Internet to help them find the best deals while holiday shopping. Figure 9 Q. Please tell me if you are very likely, somewhat likely or not at all likely to do each of the following this holiday season Consumer Electronics Association (CEA). All rights reserved. research.ce.org 5

6 Methodology The report described herein was designed and formulated by the Consumer Electronics Association (CEA). Data from this analysis brief was sourced from CEA s 19th Annual CE Holiday Purchase Patterns study. The quantitative study was administered via telephone interview between September 13 and 16, 2012 to two random national sample s, which when combined, consists of 1,019 U.S. adults (668 interviews were conducted by landline phone and 351 interviews were conducted by cell phone). The margin of sampling error at 95% confidence for aggregate results is +/- 3.0%. For Americans 50+ the sampling error is +/- 4.7%. CEA members can access CEA s 19th Annual CE Holiday Purchase Patterns study at Non-members may purchase the full study which includes analysis and data crosstabs at About CEA The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the $195 billion U.S. consumer electronics industry. More than 2,000 companies enjoy the benefits of CEA membership, including legislative advocacy, market research, technical training and education, industry promotion, standards development and the fostering of business and strategic relationships. CEA also owns and produces the International CES - The Global Stage for Innovation. All profits from CES are reinvested into CEA s industry services S. Eads St. Arlington, VA Tel: or Fax: Market Research & Library Tel: Fax: Find CEA online at About AARP AARP is a nonprofit, nonpartisan organization with a membership that helps people age 50 and over have independence, choice and control in ways that are beneficial and affordable to them and society as a whole, ways that help people 50 and over improve their lives. Since 1958, AARP has been leading a revolution in the way people view and live life. About AARP s initiative: The TM initiative aims to spark entrepreneurial activity across public and private sectors. Anchored by the AARP social mission to enhance the quality of life for all as we age the initiative enlists the expertise of visionary thinkers, entrepreneurs, the investment community, industry and not-for-profits to spur innovation to meet the needs and wants of people over 50. On the ground, the initiative catalyzes research and helps shape a marketplace ethos by promoting core, unifying principles such as "design for all." It stimulates new business models that reflect the broad transformation in how the 50-plus life is being re-imagined. Lastly, the initiative prepares 50-plus people to communicate with, access, engage and thrive in a new "longevity economy." For more information please visit: Consumer Electronics Association (CEA). All rights reserved. research.ce.org 6

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