Hey.

It is already the second month of self-isolation. Electronics hypermarkets remain closed, home delivery has become a routine process, since there is no other way to buy something today. Consumer habits have changed, we can say that the market has changed and did it instantly. People began to choose other products, the criteria for evaluating products, what was important and what was secondary, changed. Perhaps the key difference between this period is the inability to touch the goods with your hands; you cannot come to the store to evaluate and try a smartphone, refrigerator or TV. Now the choice is based on beautiful pictures on manufacturers’ websites, according to reviews and reviews on the network. But you cannot look at the goods until the moment they arrive at your doorstep, and this changes the very principle of how people choose technology.

In any crisis, sales of well-known brands increase, people begin to be guided by the maxim “we are not rich enough to buy cheap things.” Benefiting from this are companies that have invested in marketing day and night, they are heard and in the field of vision of potential buyers. For example, it remains a mystery to me why KitchenAid kitchen appliances suddenly skyrocketed in sales in a number of channels. It is cool, well done, but the cost is the maximum, and it would be hard to call these products massive. For most buyers, it is expensive and very expensive, but now the brand is taking off, and it is extremely difficult to buy any individual gadgets. The manager of one of the stores specializing in such equipment said: “Many people licked their lips at this harvester, came and looked at them in the store, but it was a pity to pay that kind of money. And now there is a feeling that money is just paper, so they began to disassemble it like hot cakes. Maybe, of course, people are cooking and think that a cool saucepan will automatically cook food and make it delicious. But I doubt it. I think this is a matter of perception of the future and what this money will be. ”

It cannot be assumed that buying the same KitchenAid is vital. This is pampering, the ability to choose a kitchen tool that is higher in class than conventional counterparts, which are several times cheaper. It is interesting to look at the goods of the first price, that is, not the most optimal in terms of price / quality ratio, but at the same time cheap. This category of goods is always in demand, but during this crisis there was no surge in consumption, and the reason was the absence of working stores. People cannot convince themselves that they are making the right choice, that their economy is not critical. In the store, they could compare a teapot from a little-known company or a local brand with the conditional Braun, Philips and understand that apart from the brand on the case, there are no differences as such. But in isolation, this trick no longer works. Therefore, they choose either a product that is already known, is at home and does not cause any complaints, or a product of a brand known to the consumer. For the mass market segment, one manufacturer benefits from this, and that is Xiaomi. A large range of various home electronics, a brand that is known to almost everyone, there is plus or minus an interesting design and at the same time quite affordable prices. Xiaomi sales are growing by leaps and bounds in almost all segments.

Perceptual stereotypes and common sense suggest that the very format of isolation, the need for telecommuting, leaves its mark on sales. I asked how people imagine goods that are in demand and what sells worse than before the crisis. Some things were easy to guess, some people knew from personal experience, but there were also many assumptions that were not supported by actual sales.

If we take last year as a starting point, then electronics sales in April fell by 27% year-on-year (in Russia this is a moderate decline, in Europe the figures are much worse). These are a variety of products, from smartphones to advanced toys. There are categories in which the decline was 90-95%, and there are categories in which there is an increase, limited only by the availability of goods in warehouses. Likewise, devices that were completely unusual for the mass market, which were recently considered exotic, appeared.

Pandemic electronics – what is in demand because of the disease

The threat of disease, the need to monitor one’s health led to the flourishing of any goods that even hypothetically can “protect” or provide information about health. For example, a variety of pulse oximeters have appeared in electronics stores, which are sold at a cost of 4-7 thousand rubles. Usually these are household devices, not medical devices, but they give an idea of ​​the oxygen saturation of the blood.

Previous generations of Samsung flagships (Note9, S10 / S10 + and others) are leaving in open cellular stores, as they have a built-in oxygen saturation sensor. Considering the discounts offered by federal networks (MTS, MVideo, Beeline), the purchase of such smartphones becomes a profitable business, today they are often sold at a price lower than the purchase price. But in stores, their promotion comes at the expense of a function that for many years was ignored and considered pampering. Suddenly, it has evolved into a coveted and unique feature that other companies do not have in such devices.

Wearable electronics are enjoying exactly the same heyday. All bracelets and watches that can measure not only the pulse, but also the oxygen saturation of the blood are sold with a bang. The logic of buyers is clear, they want to catch the moment when health problems begin and act.

For this reason, pharmacies quickly disassembled thermometers, both conventional mercury and remote ones. Manufacturers of smart electronics have similar thermometers, no one needed them for a hundred years at lunchtime, now, at the very least, they have sold out. The shortage of inexpensive, familiar thermometers has pushed sales of this stale product as well. Speaking about pharmacy chains, it should be noted that even before the isolation period, inhalers of all stripes quickly scattered, this is also a response to a potential threat. Not a ventilator, but great help for breathing difficulties.

For the home, sales of air purifiers, ionizers, and anything else that has the potential to remove dust from homes have grown. Basic models disappeared first, then those that were more expensive. It should be noted here that demand peaked in the weeks before isolation, when it became obvious that it would happen and people would be in their homes. Most of the sales of such equipment falls on city apartments, they do not buy such equipment outside the city (judging by the delivery addresses of one of the federal networks, 99% of deliveries are within the city).

Interestingly, the sales of floor-standing air conditioners have grown. I think that they were bought as a two-in-one device, many models have filters for air purification. Although this is clearly not the device that directly performs this task. But conventional air conditioners, for example, split systems, were not in demand, the explanation is the impossibility of installing them in a short time, and it is not the season for such equipment.

Another item that has quickly risen in price and popularity is the automatic dispenser. The soap is squeezed out automatically, you only need to raise your hand. This is also about safety: come from the street, wash your hands and do not touch anything in your apartment.

Remote work and training – growth of sales of familiar devices

The format of our life has changed dramatically, instead of the usual offices, many people began to work from home. Pupils and students continued their education remotely, and this required a variety of equipment, the purchase of which was postponed or not necessary until that moment.

Notebook sales have skyrocketed, with growth occurring across all device categories, from the cheapest to the most advanced. Against this background, the growth of gaming laptops has also happened, but this category has not grown as much as others. On the other hand, the division of laptops into gaming and ordinary laptops for many manufacturers has become very conventional, many machines are universal in nature, and their power is enough for a comfortable game in everyday life. Sales peaked before isolation, but laptops are still selling well today. This crisis has supported sales of computer hardware.

Sales of storage media, external hard drives, SSDs and flash drives have skyrocketed. The reason, as it seems to me, is obvious, at remote work, many experienced the need to move large amounts of information from the workplace to home and back. Perhaps someone expanded the memory of their old computer in this way, such a hypothesis also has the right to life.

Sales of mice, keyboards of all stripes and even rugs have also shown strong growth. Many have set up home jobs, hence the surge in demand for computer chairs, there is no decline, and there are many more “players” than sales of gaming equipment. I think the reason is simple, such chairs are comfortable to work with, and many people buy them for this very reason. I bought such a chair for a child in a country house, so the assembler, collecting the details with actions brought to automatism, said that there had never been such a stir and he was simply sewn up. You have to work from eight in the morning to ten in the evening. It was easy to believe in looking at the jammed truck body.

Sales of webcams have increased, as telecommuting requires eye contact, as does training. They were actually swept away, they turned into a scarce commodity, only the very top-end solutions can be found on the shelves. It is good that new deliveries are not delayed, but the market digests them very quickly.

A terrible shortage of USB modems and cellular routers, they ended in a matter of weeks. Not the most popular product before the era of isolation, but the change of place of work from office to home forced many to look for a comfortable option for the Internet and its distribution. Why people do not want to use ordinary smartphones for this remains a mystery to me, they are looking for a specialized solution. On the other hand, the surge in sales of several budget smartphones with a large battery and a good LTE part is corporate purchases to replace routers, companies have found such a way out. I think other people have started using smartphones as well. I tried to find out about this from the operators, no one wanted to officially comment on how many people started distributing the Internet to other devices. Not on record, they said that the consumption of this service had grown by almost an order of magnitude, that is, the scenarios for using the Internet have changed, as well as Internet packages have grown or it has become completely unlimited, since there is always not enough traffic. Look at my non-primary number, we are just getting close to the middle of the month, and I already had 64 GB of data on my video calls.

I will not say anything about the main number out of a sense of modesty, there are mind-blowing numbers. Perhaps, for the first time, high-quality sales of SIM-cards from operators have grown so much, the growth of the subscriber base is now not bloated, but quite real. Many have purchased additional SIM-cards, as they need the Internet all the time at home or outside the city. If earlier it was raids and it was possible to survive a day or two with a bad Internet, now this is no longer the case.

Many speculate that tablet sales have increased, ostensibly for training purposes. Statistics is a stubborn thing, tablets have not fallen compared to last year, which is already good for this niche, and this can be considered growth. But there is no explosive consumption, this is already a receding nature for most consumers.

It makes no sense to list all the products, I showed only the main types, categories, so that you have an understanding of how the market has changed. At the moment, these products are no longer in the same demand as in the second half of March – early April. That is, the peak in demand for them has passed, everyone has arranged their workplaces in spare positions at home.

Victims of Isolation – Products That Have Dropped in Sales

The stereotype dictates that sitting at home needs to be filled with something, for example, playing games on a console or computer, watching TV. Common sense dictates that many have bought TVs for themselves, have taken panels with a larger diagonal in order to comfortably spend these days. Alas, the harmonious logic of this assumption breaks down on reality, TVs in sales have not grown, sales are falling in almost all price segments, read, diagonals. And the successes of individual brands, manufacturers and models only underline the overall decline of this market.

Why did it happen so? I will assume that those who have funds to buy brand new TVs already have them and no one feels the need to change an awl for soap. But the delivery of new apartments, the completion of finishing work and the purchase of household appliances in them, for example, the same TVs, was postponed for a while after isolation. This is a deferred demand that has not disappeared anywhere. And he influenced this market the most, and not something else.

This assumption is easily verified by evaluating the sales of embedded appliances, the implementation of this technique has dropped dramatically, as explained above. Here we also see deferred demand.

Until I dug into the sheets with product categories, I could not imagine that the sales of fashion goods and accessories would drop so much that they show your attitude to certain issues of the universe, position you in this world. When you see a young man wearing big on-ear headphones, it is always a kind of statement – “I listen to music, I am active.” Or something like that, fairy tales that marketers love so much.

Sales of such headphones dropped by 40-50%, we are talking about all brands, there are almost no exceptions. Now the image component has receded into the background, for buyers it does not matter who and what will see on them within their apartment or during a trip to the store.

Surprisingly, sales of noise canceling headphones, on the contrary, remained at the same level, sagging slightly. Previously, such models were promoted as the ideal travel companion, devices that remove the hum of aircraft turbines or the noise of the subway. At home, they also came in handy to isolate themselves from the hubbub of children or neighbors who started a great construction project and work as a puncher from morning to evening.

Home wireless speakers have sagged in sales, but speakers for the sea and outdoor parties feel the worst. The demand for them has dropped significantly. Perhaps, only the protection of smartphone screens can compete with this category in terms of the drop rate. The fewer stores are open, the worse this accessory sells.

The death of tourism in our usual form immediately affected the sales of digital cameras of all levels, these products suddenly became unclaimed. Professionals already have such a technique, but amateurs do not need it, they simply have nothing to photograph. Corporate customers that buy digital cameras for their systems have also postponed purchases until better times. This segment of the market is practically dead, nothing happens here – sales are by piece. The situation for camera manufacturers can be compared to that of airlines, the similarities are obvious.

Smartphones sagged in sales, but the drop rate is less than expected (April 15% yoy). In March, flagships were in demand, they were massively bought by people who cannot afford them (installments, loans). One of the hypotheses, expressed by our reader, sounds like this: we have collected credits in the expectation that we will not have to pay and force majeure will come. If these buyers were counting on this, then I have bad news, they will have to pay their bills. I think that in the second half of the summer we will see a lot of such credit smartphones in offers from individuals. People simply will not be able to pay the remaining money on the loan.

The drop in sales of external batteries was unexpected for me; on the other hand, this is logical. People are at home, there is always an outlet at hand, and there is simply no reason to buy such an accessory.

The lucky ones are the products that showed unexpected sales growth

There are products that are completely unobvious from the point of view of the logic of buyers and why they suddenly became popular. For example, a smart home has become such a product. For many years, different companies stormed this segment, but nothing worked, there was no sense from it. During the period of isolation, people began to buy both elements of a smart home, for example, lighting, and sets. The market began to grow before that, but in isolation it turned into a galloping one. I have only one explanation – people at home are bored, they have time, and it needs to be occupied with something. And a smart home is something that they have wanted to try for a long time, but their hands did not reach. In turn, the emergence of such smart devices pushed the sales of voice-controlled speakers, they began to be in great demand. But, as before, their lifespan remains very short, people play with them, and then abandon them.

A mystery to me is the growth in the sales of finger-type batteries (both AA and AAA), whether people shook off the dust from their control panels and decided to buy them some power, or they are restoring some devices in houses that they did not use. I hope that with your examples you will be able to explain why batteries have become so in demand. What are buyers preparing for?

Very often we try to transfer our personal experience to the general, for example, I bought myself an excellent flashlight and I start to think that many people share my need for a flashlight and have purchased such an accessory these days. Alas, I am not suitable as a role model, this product has not become popular.

It’s funny, but isolation at home has awakened an economic vein in people. The sales of light, lamps of different formats, brightness and purpose went up. It seems to me that people simply did not change the burned out lamps, their hands did not reach this. And now they are doing it. Have you changed the burned-out light bulbs during self-isolation? The assumption that during this time the lamps began to burn more often will not stand the test of reality, modern lamps have too long a service life.

People began to cook more often, so small household appliances for the kitchen began to grow. The same can be said about vacuum cleaners, it is especially interesting that models of hand-held vacuum cleaners show growth. For me, such vacuum cleaners seemed like a toy, but such a vacuum cleaner turned out to be a very interesting thing, it allows you to clean up in passing, not to turn cleaning into a long and tedious process. Five minutes, and you can do your business. Then another five minutes, and everything is done.

The sales of wireless chargers have grown significantly, I also write off the fact that people have dismantled household rubble, raked away desktops and found spaces where such chargers can be installed. This is convenient, I recommend that you use these wireless chargers.

Change in consumer behavior – an anomaly or a new reality

I didn’t have a task to show absolutely all categories of goods that grew or fell in sales, rather it was interesting for me to talk about anomalies directly arising from the need to be at home. Isolation has reformatted the market, many people began to work remotely, we save time not only on the way to work and back, but we eat at home and do not spend money on new clothes, going to restaurants and cinema, theaters. Leaving aside the unemployed and those who have been on the brink of poverty all this time, the economic activity of this social group has always been relatively low. But for those who actively bought electronics, the current situation is such that it frees up additional funds that can be spent on something, for example, on a new toy. But it is precisely that anomaly, the influence of which will disappear as soon as the period of isolation ends. And new supplies of equipment are already under way at different prices, they are higher. All this will negatively affect the market volume, and the absence of the isolation factor will return the market to the pre-crisis rules of the game. But, for example, the same digital cameras will no longer be able to restore their sales volume, this is an unlikely scenario. Likewise, pulse oximeters are not a product that will be popular for a long time.

To successfully adapt to such a volatile market, you need to think about how customer behavior is changing. What affects them. The key factor, in addition to the pandemic, is the inability to touch the goods with your hands, this is both a plus and a minus for retail chains. And the new opportunities that are opening up for stores can hardly be overestimated. This is a new, unusual trading format that must be used correctly in order to be successful during this period. Someone can rebuild themselves quickly, someone does not know how to do this and does not want to learn it.

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