Accenture GlobalConsumerTech 2011

Preferred LetterEmergence of a Alternate Letter Finding Growth: Brochure Title Technology Paradigm Brochure Title New Consumer
The 2011 Accenture Consumer Electronics Products and Services Usage Report
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Contents
Executive Summary About the Research "Hot and Not" Technologies: Consumer Technology Ownership Patterns Wheres the Opportunity? The Importance of Consumer Technologies and Spending Patterns An Activity-Based View: What are Technology Users Doing? A Look at the US Market Implications for Consumer Technology Companies Snapshots of Hot Technologies 3 6 8 17 22 27 30 33
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Executive Summary
Around the world, todays consumers view technology as an integral part of their lifestyle, just like fashion and transportation. In fact, as a spending category consumer technology is ranked by the majority of consumers as a top-three priority (in Japan, its the top priority). But as with other lifestyle categories, rapid shifts in consumer technology and usage preferences are occurring. This years edition of Accentures Consumer Electronics Products and Services Usage Report reveals high interest in new technologies, greater turnover in device usage, significant preference and usage differences among generations and global regions, and sustained spending levels despite an uncertain economy. As a result, to win as a lifestyle choice, consumer technology companies must have the same ability to adapt to consumer preferences as do other lifestyle companies. Just like fashion businesses (such as Zara or H&M), for instance, consumer tech companies must align research and development capabilities with the ability to predict and follow consumer preferences around the world, strengthen innovation capabilities, and create more agile and responsive operations.
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A widening enthusiasm gap

The urban consumers in Brazil, Russia, India and China (the BRIC markets) have leapfrogged the average maturemarket consumer in their use of technology. They have a much greater appetite for consumer technology from many measures, including the devices they own, their purchase plans and their use of applications. Counter to common misperceptions, a large segment of BRIC consumers are more interested in the newest and most innovative technologies than in the lower price point technologies with less functionality. BRIC market consumers have a higher rate of adoption of the newest technologies and a greater willingness to pay premiums for features and enhancements. For instance, a full 84 percent of Indian respondents say they will pay a premium for enhanced smartphone capabilities. That translates into roughly 148 million consumers. In the BRIC markets, in particular, prospects are bullish for spending on consumer electronics in 2011. This is especially true in China, where this years purchasing plans for technologies such as smartphones and high-definition TVs are staggering. Assuming China has an estimated 167 million urban households and an estimated urban population of 434 million people in the consuming age, 38 million high-definition TVs and 63 million smartphones will be purchased there in 2011. In contrast, mature markets are more conservative and price sensitive. Consumers in the US, Japan, Germany and France have less ambitious plans to purchase new devices in 2011, use fewer applications overall, and are far less willing to pay premiums for new features and enhancements. And, while consumers 55 years or older in mature markets tend to have higher disposable income (and therefore greater ability to spend on technology), they more often wish to spend as little as possible to keep up on the technology adoption curve. In contrast, younger consumers in BRIC markets demonstrate a huge
appetite for electronics, but like millennials around the globe, they are often harder to please, less loyal and have less disposable income to spend.
next upgrade cycle for TVs (3-D TV) is underway. And, Blu-ray players are continuing to displace DVD players (albeit at a slow pace) and VCRs. Another benchmark of the new technology paradigm is that as new technologies emerge, consumers are increasingly quick to stop using particular devices if they feel they have the same functionality in another device that performs the same function betterespecially in BRIC markets. Twelve percent of consumers surveyed in the BRIC markets stopped using mobile phones in 2010 because they had another device with the same functionality. This compares with only five percent of consumers in mature markets who jettisoned their mobile phones. And, in both mature and emerging markets, younger people appear to be far more willing to let go of duplicative devices.
A new consumer technology paradigm

Computers and laptops are the quiet giants among consumer electronics. Practically everyone has one. They are owned by 93 percent of respondents in our global study, and therefore the top-ranked technology in terms of ownership percentage. Twenty-eight percent of respondents purchased a computer or laptop in 2010. Yet this years study shows that there may be a chink in the giants armor. Only 17 percent of consumers we surveyed plan to purchase a computer in 2011a 39 percent decline in the purchase rate in the next year. In fact, the trends in ownership of various devices indicate that some newer technologies may be rapidly making others obsolete. For instance, while the growth rate of computers is expected to decline, the growth rate of tablet PCs is estimated to be up by 160 percent. And while our study shows that game consoles, digital photo cameras and portable music players are all facing declining growth rates, the smartphone (which can do many of the same activities) is expected to increase its growth rate by 26 percent. So can the giant remain strong? Or, in the long run, will a group of newer technology alternatives (the tablet PC, netbook, smartphone and e-book reader) make the computer and other devices obsolete? If measuring strength by unit sales, one finds the computer will remain the strong giant for many years. But if measuring by growth rate, the giant seems to be weakening. This years data also shows consumers are well into or nearing the end of several technology upgrade cycles. For instance, regular TVs are largely being replaced by high-definition TVs, and there are emerging signs that the
Surprises in the ranks of the most popular apps

The most popular applications in 2010 included emailing and searching the Web for information. But surprisingly, banking ranked number three in popularity and is an activity conducted in a typical week by more survey respondents than is texting or watching videos. Social networking held steady in popularity with 39 percent of respondents using social networking apps in a typical week. In both the US and China, the percentage of respondents doing social networking in 2010 and 2011 held constant at 46 percent in the US and 37 percent in China. Indias participation in social networking has actually declined. In 2010, 57 percent connected at least weekly, and in 2011 that number had fallen to 42 percent. And, new to the ranks among popular applications was managing my health, which was selected by just over one-fourth of respondents as an activity they conduct via technology in a typical week.
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Multi-device application use on the rise

After years of applications and activities being tied to a specific type of hardware, many activities are now device agnostic. Some of the most popular new consumer technologies are able to perform many of the same activities as other well-established devices in the marketplace. For example, smartphones are just as able to hold all of ones music and take high-quality photos as portable music players and digital cameras. So to better understand which devices consumers choose for various activities, we queried respondents about the activities they do weekly on mobile or smartphones, laptops, televisions, tablet PCs, netbooks, e-book readers and in cars. Overall, respondents indicated they clearly prefer to conduct some activities on mobile or smartphones (texting and email), television (watching shows), and e-book readers (reading). However, for many of the activities most frequently done on a computer, a respondent is also as likely to use a mobile phone, tablet PC or netbook. Emailing, texting, watching videos and connecting on social networks are all increasingly multi-device activities. For instance, in India, emailing on a PC dropped from 86 to 67 percent year-over-year while emailing by phone grew from 19 to 34 percent. Hence, while computers are the most frequently turned-to devices, consumers are more often conducting activities with a multi-device approach.
Innovation and environmental responsibility remain strong drivers of growth

So what will motivate consumers to make purchases in the coming year? Perhaps innovation will play a part. Almost two-thirds of consumers said it was somewhat or very important to them that the products they purchase are perceived as the most innovative of technologies. Innovation appears to be a far more important purchase lever in emerging markets than mature ones: 76 percent of the former said the perception of having the most innovative of technologies was somewhat or very important to them versus 46 percent of the latter. However, as the recent lines of consumers waiting for new Apple iPhones and those waiting for Wii game consoles just a few years ago illustrate, there will always be mature market consumers who respond to the market hype about new technology. Environmental responsibility is also clearly important to consumers, so much so that it commands a premium price. Sixty-eight percent of respondents said they would pay a premium for an environmentally friendly product (e.g., lower power consumption, easier to recycle, manufactured using sustainable practices). Again, this is a bigger growth driver in emerging markets than mature ones, at least if measured by price elasticity. A full 82 percent of emergingmarket respondents said they would pay a premium for environmentally friendly products compared with just over half of mature-market respondents.
In summary, in the fast-changing consumer electronics industry, exploiting big growth opportunities is becoming increasingly difficult. Our research helps consumer tech companies with this challenge by offering information on the hottest current and emerging geographic, product and application markets for consumer technology. For instance, the highest spending in 2011 (and we believe for years to come) is projected to be in urban and semiurban BRIC markets. Demand for mobile applications such as banking continues on a strong growth trajectory. And new technologies (such as tablet PCs and e-book readers) and next-generation technologies (such as smartphones, 3-D and Internet-capable TVs) are projecting substantial growth. The research also suggests that consumer technology companies will require newor, at minimum, strongercapabilities to capitalize on these growth opportunities and remain a relevant lifestyle choice to consumers. For many consumer technology companies, keeping pace will require a rethinking of their innovation engines. Specifically, we believe organizations must pay much more attention to the foundational elements of innovationthose things that form the basic capabilities of their R&D function. They need to distribute their innovation around the world to enable them to develop offerings that are more attractive to local markets. They also need to achieve a greater level of innovation process discipline so they can reduce time to market and increase return on innovation investment. Finally, all consumer tech companies should be paying close attention to ensuring that they have the capabilities that will help them consistently execute their innovation process over time to sustain their success.
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Abou Resea
About the Research

For four consecutive years, Accentures Electronics & High Tech industry practice has conducted research to identify and track preferences for consumer technologies and services. The research is intended to help consumer technology executives better understand the purchase patterns and use of consumer technologies and to gain deeper insights into global differences. From this research we are better able to project future technology trends based on current behavior and identify trends emerging from behavioral changes in the use of technology. This annual research began as a US study in 2008 and grew to a global study in 2010. For the 2011 report, Accenture conducted a quantitative online consumer study comprising 8,002 interviews across eight countries: the US, Japan, Germany, France, Brazil, Russia, India and China. The research, fielded in October and November 2010, sought to cover a demographically representative sample across all the geographies (Figure 1). In Brazil, China, India and Russia, the sample is representative of the urban and semi-urban populations. (In this research report, we reference aggregate data for these countries as findings on BRIC markets or emerging markets. We refer to aggregate data for Japan, Germany, France and the US as mature markets.)
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Figure 1
Figure 1. Respondent demographics
20%
15%
Age
18-24 years
50% 24% 19%
25-34 years 35-44 years 45-54 years
50% 22%
55 or older
Gender 50% 50%

Female Male
12.5%
12.5%
Country US France
12.5%
12.5%
Germany Japan Brazil
12.5%
12.5%
Russia India China
12.5%
12.5%
About the Research | 7
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Hotan Technol
"Hot and Not" Technologies: Consumer Technology Ownership Patterns

High-level findings:
While the growth rate of computers is expected to decline in 2011, the growth rate of tablet PCs is estimated to increase by 160 percent. The purchasing growth rate for 3-D TV in 2011 is projected to be a staggering 500 percent. Tablet PCs and e-book readers are owned by nearly a quarter of Chinese respondents more than three times the ownership rates of any other country except India, where 10 percent of respondents own a tablet PC. Forty percent of respondents in mature markets dont plan to purchase any consumer electronics in 2011, compared with only 9 percent of those in the BRIC markets. Emerging markets are quicker to let go of duplicative technologies than are mature markets, particularly mobile phones, regular TVs, DVD players and VCRs.
"Hot and Not" Technologies | 8
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As the giant of consumer electronics, the computer is owned by 93 percent of respondents. Yet the trends in ownership of various devices indicate that some newer technologies may be rapidly making others obsolete, including the traditional desktop/laptop computer. While the growth rate of computers is expected to decline, the growth rate of tablet PCs is expected to be up by 160 percent. Bottom line, theres an end in sight for the relevance of the personal computer as we know it today. To better monitor this trend and help consumer electronics companies find growth opportunities, this year Accenture introduces its 2011 Consumer Technology Power Rankings (Figure 2), in which we rank the top consumer technologies based on their global penetration and changes in their projected rates of growth year over year. Given the ubiquitous ownership of the computer, it holds the top spot in the 2011 Power Rankings. Mobile phones rank second but face an even steeper rate of purchasing decline than computers, with 56 percent fewer consumers planning to purchase mobile phones this year than in 2010. It is intuitive that mobile phone users are switching more aggressively to smartphones. Ranked 10th overall, the purchase rate of smartphones is projected to increase by 26 percent in 2011.
Digital cameras hold the #3 spot in the rankings, owned by 76 percent of respondents. But the camera is projected to decline in purchase rate by 45 percent next year. And while DVD players hold the #4 rank, they face the steepest purchasing rate decline of the 19 consumer technologies evaluated this year. High-definition TVs are owned by only 50 percent of respondents, but it is the most pervasively owned technology in the Power Rankings that is showing projected purchase-rate growth next year. In France and Japan this year, more consumers have highdefinition TVs than regular TVs. While some of the newest technology innovations hold the lowest Power Rankings this year, their growth rates are projected to be phenomenal. For instance, 3-D TV is the technology owned by the smallest percentage of respondents, but its purchasing growth rate in 2011 is projected to be a staggering 500 percent. Tablet PCs, e-book readers and Blu-ray players round out the list for the technologies expecting the most purchasing growth this year. As the global data foretells, the computer is the technology owned by the most respondents in every country surveyed. But consumers country to country certainly have different
preferences about other devices (Figure 3). For example, smartphones are far more popular in some countries than others: 53 percent of Chinese consumers own a smartphone, compared with only 10 percent of their Japanese counterparts and 33 percent of Americans. Tablet PCs and e-book readers are owned by nearly a quarter of Chinese respondentsmore than three times the ownership rates of any other country except India, where 10 percent of respondents own a tablet PC. This data is not unlike research recently released by market research firm Technology Business Research, Inc. (TBR). TBR finds that the tablet will displace many consumers' secondary PCs but predicts the market will ultimately support all three device styles for computing and connectivity, including 1 the laptop, tablet and smartphone. Globally, some devices (such as smartphones, portable music players, game consoles and portable gaming systems) are much more prevalent among younger generations than those over 55. This generational difference is most pronounced within mature markets, where there are significant differences in what younger generations (under 25) and older generations (over 55) own most frequently (Figure 4).
1"Oops, Steve Jobs Did it Again: Apple's iPad Will Disrupt the PC Market by Creating a New Usage Model", 2010 iPad Study, Technology Business Research Inc, September 16, 2010.
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Figure 2. 2011 Consumer Technology Power Rankings Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Consumer Technology Computer Mobile Phone Digital Photo Camera DVD Player Regular TV High-Definition TV Portable Music Player Game Console VCR Smartphone GPS Digital Video Camera Portable Gaming Device DVR Netbook Blu-ray Player Tablet PC E-book Reader 3-D TV Power Trend -39% -56% -45% -57% -50% 9% -37% -25% 0% 26% 11% 50% -25% 0% 22% 120% 160% 133% 500%
Power trend calculated as (% intending to purchase next year - % purchased last year)/% purchased last year
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Figure 3
Figure 3. Country breakdown of device ownership

Total Computer US France Mobile phone Germany Japan Digital photo camera Brazil Russia India DVD player China
Regular TV
High-definition TV
Portable music player
Game console
VCR
Smartphone
GPS
Health and fitness device
Digital video camera
Portable gaming device
DVR
Netbook
Blu-ray player
Tablet PC
E-book reader
3-D TV 0% 20% 40% 60% 80% 100%
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Figure 4
Figure 4. Generational differences in device ownership

Mobile phone Smartphone High-definition TV Regular TV 3-D TV DVR Computer (desktop or laptop) Tablet PC Netbook E-book reader Portable music player Game console Portable gaming device Digital photo camera Digital video camera DVD player Blu-ray player VCR Health and fitness device GPS 0% 20% 40% 60% 80% 100% Mature markets 18-24 years 25-34 years 35-44 years 45-54 years 55 or older
Mobile phone Smartphone High-definition TV Regular TV 3-D TV DVR Computer (desktop or laptop) Tablet PC Netbook E-book reader Portable music player Game console Portable gaming device Digital photo camera Digital video camera DVD player Blu-ray player VCR Health and fitness device GPS 0% 20% 40% 60% 80%
Emerging markets 18-24 years 25-34 years 35-44 years 45-54 years 55 or older
100%
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What was purchased in 2010

Mobile phones and computers were the consumer electronics devices purchased by the most respondents in 2010. Perhaps because these devices are the most ubiquitous globally, the largest percentage of consumers continued to buy them in 2010. However, as the Power Rankings indicate, the growth rate in mobile phone and computer purchases is showing decline. The third-most purchased consumer technology was high-definition TVs, bought by 23 percent of respondents. As the latest technologies to hit the market, tablet PCs, 3-D TVs and e-book readers were purchased by small minorities of respondents (Figure 5). Yet as the Power Rankings indicate, many more consumers anticipate purchasing these technologies in 2011. VCRs were the least purchased technology in 2010, purchased by only 1 percent of respondents globally. There were significant differences between what mature-market respondents and emerging-market respondents purchased in 2010. Overall, more respondents in emerging markets made purchases than in mature markets: 87 percent of emergingmarket consumers made purchases last year compared with 71 percent of mature-market respondents. This more conservative purchase behavior in Japan, the US and western Europe is understandable, given the uncertain economies faced by each of these countries last year and the comparative lack of enthusiasm about technology because it has been affordable and accessible to many of these consumers for years. Electronics purchased much more frequently in emerging markets include mobile phones, computers, netbooks and digital cameraslargely driven by younger generations of the population
in emerging markets. In particular, consumers in Brazil, China and India purchased a number of electronics more than respondents in other countries, including mobile phones, smartphones, computers, netbooks and digital photo cameras. With more stable economies and growing wealth among the middle class in these countries, consumers appetites for technology (especially mobile technology) are insatiable.
What is being discarded as obsolete

Perhaps a leading indicator of growth challenges for particular types of devices is what consumers stopped using because they feel they have the same functionality in another device. The devices that the greatest percentage of survey respondents have stopped using are the VCR and regular TV (Figure 7). Perhaps that helps to explain why the purchase rate for regular TVs is expected to decline by 50 percent next year. Emerging markets are quicker to let go of duplicative technologies than are mature markets, particularly mobile phones, regular TVs, DVD players and VCRs. More than 10 percent of respondents stopped using these devices in BRIC countries last year. This is in contrast to mature markets, where no more than 9 percent stopped using any device. And in both mature and emerging markets, younger people appear to be far more willing to let go of duplicative devices. Seventy-three percent of those 55 and older said they havent stopped using anything because of duplicate functionality, compared with just 46 percent of those under 25.
What consumers plan to purchase in 2011

The technologies that most respondents intend to purchase within the next 12 months include high-definition TVs, smartphones and computers (Figure 6). In general, those devices with the largest ownership base are also those continuing to be purchased. Interestingly, one-quarter of respondents globally dont plan to purchase any consumer technologies in 2011. More than one-third (37 percent) of those 55 and older dont plan any purchases, compared with only 15 percent of those between 18 and 24 years of age. And a stark contrast in purchasing plans exists between mature and BRIC markets: 40 percent of respondents in mature markets dont plan to purchase any consumer electronics in 2011, compared with only 9 percent of those in the BRIC markets. One factor that could influence the purchase plans for smartphones and tablet PCs next year is the availability of applications for these devices. Seventy percent of respondents said that the availability of applications slightly or greatly influenced their decision to purchase a smartphone or tablet PC. Almost one-third (31 percent) said it greatly influenced their purchase decision.
The most-used consumer technologies

The top five consumer electronics in terms of those used most often include (in order of most frequent use): smartphone, computer, mobile phone, high-definition TV and regular TV (Figure 8). Given that smartphones are only 10th in the Power Rankings (owned by 28 percent of the respondents), its clear that those who own them use them heavily. Interestingly, consumers in every country rank the same technologies among their most often used, with slight variations within their order in the top four ranks. For instance, BRIC markets have a higher use of mobile phones than do other countries. Televisions and computers are used less often in emerging markets than in mature ones.
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Figure 5
Figure 5. Devices purchased in 2010

Mobile phone Total US Computer France Germany Japan Brazil Russia Digital photo camera India China Smartphone
High-definition TV
Netbook
GPS
Portable music player
Game console
DVD player
Health and fitness device
Digital video camera
Blu-ray player
Regular TV
DVR
Portable gaming device
Tablet PC
E-book reader
3-D TV
VCR
None 0% 10% 20% 30% 40% 50% 60%
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Figure 6 Figure 6
Figure 6. Intentions to purchase in 2011

Mobile phone Mobile phone Smartphone Smartphone High-definition TV High-definition TV Regular TV Regular TV 3-D TV 3-D TV DVR DVR Computer Computer Tablet PC Tablet PC Netbook Netbook E-book reader E-book reader Portable music player Portable music player Game console Game console Portable gaming device Portable gaming device Digital photo camera Digital photo camera Digital video camera Digital video camera DVD player DVD player Blu-ray player Blu-ray player VCR VCR Health and fitness device Health and fitness device GPS GPS None of the above None of the above
0% 0%
20% 5% 10% 15% 20% 5% 10% 15% Percent of Respondents Intending to Purchase Percent of Respondents Intending to Purchase
25% 25%
Figure 7. Percentage of consumers who have stopped using the device this year
Mobile phone Mobile phone Smartphone Smartphone High-definition TV High-definition TV Regular TV Regular TV 3-D TV 3-D TV DVR DVR Computer Computer Tablet PC Tablet PC Netbook Netbook E-book reader E-book reader Portable music player Portable music player Game console Game console Portable gaming device Portable gaming device Digital photo camera Digital photo camera Digital video camera Digital video camera DVD player DVD player Blu-ray player Blu-ray player VCR VCR Health and fitness device Health and fitness device GPS GPS None of the above None of the above 0% 0% Globally Globally Mature markets Mature markets Emerging markets Emerging markets
10% 10%
20% 20%
30% 30%
40% 40%
50% 50%
60% 60%
70% 70%
80% 80%
Figure 7 and Not" Technologies | 15 "Hot Figure 7
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Figure 14
Our study shows that BRIC markets have far greater enthusiasm for technologies and appetite for purchasing them than non-BRIC countries, especially the latest devices such as tablet PCs. One could infer that the lower use of computers in BRIC countries is an indication that these consumers are finding alternate devices to do those activities formerly done on the computerand may, in fact, have simply leapfrogged the step of owning a computer that those in mature markets had to take because at the time there were no other options. The least-frequently used consumer electronics are (in order, beginning with least frequent use): digital video cameras, GPS, VCRs, portable gaming devices and DVD players. Despite their less frequent use, video cameras and GPS are projected to grow in purchases next year. For these devices, while they dont get used as often, they remain important to consumers when they are needed.
Figure 8. Most frequently used technologies

Computer Mobile phone High-definition TV Regular TV Smartphone Digital photo camera DVD player Portable music player Netbook DVR Game console Health and fitness device GPS Portable gaming device Tablet PC Digital video camera VCR Blu-ray player E-book reader 3-D TV 0% Figure 8 20% 40% 60% 80% 100%
The most-used technology services

Among technology services used by consumers, home Internet service is the most pervasive across the countries we surveyedcited by 89 percent of respondents as one of the top-three services they use regularly (Figure 9). Mobile phone service was the next-most used service, cited by two-thirds of respondents as a top-three service. After those two services that are consistently used by the majority of respondents, the next-most regularly used service varies greatly. Pay TV service (34 percent) and mobile data service for mobile phone (26 percent) were the next-most frequently cited as a top-three service.
Percent of respondents ranking within the top 3 most frequently used
Figure 9. Most frequently used technology services

Home Internet access
Mobile phone service
Pay TV service (e.g., Cable service, IPTV service, Satellite service, Video on Demand, pay-per-view) Mobile data service for my mobile phone (e.g., email on mobile phone)
Mobile data service for my laptop
VoIP phone service (e.g., Vonage, Skype)
Satellite radio (e.g., XM/Sirius, Worldspace) Base size = 7,677 0% 20% 40% 60% 80% 100% Percent of respondents ranking within the top 3 most frequently used
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Wheres the Opportunity? The Importance of Consumer Technologies and Spending Patterns
Respondents consider consumer technology to be integral to their lifestyle, ranking it just behind clothing and personal transportation in importance as a spending category. US consumers surveyed were the most conservative spenders on consumer technologies in 2010, while Chinese consumers spent the most. Fifty-seven percent of Chinese survey respondents spent $1500 or more. Globally, consumers planned budgets for technology in 2011 mirror their purchasing patterns from 2010, with emerging-market spending plans being substantially more ambitious than mature markets.
Where's the Opportunity? | 17
Sixty-one percent of respondents said it was somewhat or very important to them that the products they purchase are perceived as the most innovative of technologies. Sixty-eight percent of respondents globally said they would pay a premium for environmentally friendly products.
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For the first time, in this years study we Despite the fact that consumers of important consumer all ages and geographies consider electronics are to consumers relative technology as integral to their lifestyles, to other categories competing for consumer electronics companies must Mobile phone service learned that of seven their wallets. We compete extensivelyand differently categories of purchases, consumer among consumer segmentswith other electronics ranked in the top three in consumer priorities to convert that Pay TV service (e.g., Cable service, importance, along with clothing and fascination into sales. IPTV service, Satellite service, shoes, and personal transportation Video on Demand, pay-per-view) (car, motorcycle, scooter). Consumer Past and predicted spending electronics are considered more Mobile data service for my mobile on consumer electronics important to on mobile phone) phone (e.g., email people between the ages of It appears from the above category 25 and 34 than to other age groups. To preferences that spending on consumer these individuals, consumer electronics electronics is quite discretionary. Perhaps, Mobile second behind clothing and shoes. rank data service for my laptop then, its not surprising that while 11 The youngest adults (people aged 18 percent of respondents globally did to 24) rank consumer electronics less not spend any money on consumer VoIP phone service entertainment and important than (e.g., Vonage, Skype) electronics in the past 12 months, an recreation services as well as clothing equal number (9 percent) spent at least and transportation. Surprisingly, across $3,000 or more. The US was the most the globe, Satellite radio consumer electronics are conservative in spending on consumer (e.g., XM/Sirius,more important to consumers considered Worldspace) technologies in 2010, while China was than healthcare and well-being products. Base size = 7,677 0% 20% 40%the biggest spender (Figure 11). Brazil 60% 80% 100% Figure 10 shows the different levels and Russia were also reasonably big Percent of of importance consumers in variousrespondents ranking within the top 3 most frequently used spenders. There was no significant countries place on consumer electronics.
Home Internet access investigated how
difference across age groups in China in terms of spending patterns, while in Brazil consumers 55 or older represented the highest share of big spenders. Globally, consumers spending plans for 2011 mirror consumer electronics purchasing patterns from last year, with emerging-market spending plans being substantially more ambitious (especially in China and Brazil), than those in mature markets (Figure 12). Economic uncertainty in mature markets may be motivating a wait and see approach, while enthusiasm for technologyand better economic conditionsin emerging markets is driving aggressive spending plans there.
Figure 10. Importance of consumer electronics relative to other categories of spending

Total Clothing and shoes US France Germany Personal transportation Japan Brazil Consumer electronics Russia India China Furniture and household appliances
Entertainment and recreation services
Healthcare and well-being products
Travel
0%
10%
20%
30%
40%
50%
60%
70%
80%
Represents percentage of respondents ranking the category in the top three in importance Figure 9
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Figure 10
Figure 11. Amount spent on consumer electronics in 2010

Total Less than $500 US France Germany Japan $500 to less than $1,500 Brazil Russia India China $1,500 to less than $3,000
$3,000 or more
I have not spent any money on consumer electronics in the past year
Figure 11
0%
10%
20%
30%
40%
50%
Figure 12. Consumers intentions to spend on consumer technologies in 2011

US Less than $500 France Germany Japan Brazil Russia $500 to less than $1,500 India China
$1,500 to less than $3,000
$3,000 or more
I do not plan to spend any money on consumer electronics next year 0% 10% 20% 30% 40% 50% 60%
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US Less than $500
$500 to less than $1,500
Drivers of purchase behavior: The importance of innovation, sustainability and personal research
So what will motivate consumers to follow through on their spending plans, spend more or change the minds of those currently not planning any purchases? Perhaps innovation will play $1,500 to less than $3,000 a part. Almost two-thirds (61 percent) of respondents said it was somewhat or very important to them that the products they purchase are perceived as the most $3,000 or more innovative of technologies. Once again, emerging-market consumers led the way, as they were much more likely than their matureImarket counterparts to believe that do not plan to spend any money on is important (Figure 13). innovation consumer
electronics next year
Similarly, sustainability also appears to affect consumers technology spending plans, so much so that it commands a premium price. Sixty-eight percent of respondents globally said they would pay a premium for environmentally friendly products (e.g., one with lower power consumption, thats easier to recycle, or thats manufactured using sustainable practices). From a country perspective, consumers in emerging markets are far more likely than those in mature markets to say they would pay a premium for environmentally friendly products. One example of the stark contrast: 89 percent of Chinese respondents, versus just 47 percent of those in the US, indicated they would pay more for such devices.
As consumers consider technology Germany purchases, the most important source Japan of influence on purchase decisions is Brazil personal research (cited by 36 percent). Russia Thus, for consumer tech companies, India providing consumers with easy access China to product information can be critical to shaping their opinions of products. A secondary influence, but far less important, is recommendations from friends and other trusted individuals (Figure 14). China stands out here, putting recommendations from friends and consumer rankings ahead of personal research in sources of importance. Advertising campaigns, manufacturer websites and in-store salespeople were all ranked very low as sources of influence on purchase decisions.
France
0%
10%
20%
30%
40%
50%
60%
Figure 13. Willingness to pay a premium for environmentally friendly products

Total US France Yes Germany Japan Brazil Russia India China
No
0%
20%
40%
60%
80%
100%
Figure 12
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Figure 13
Figure 14. Sources of influence on purchase decisions

Total US Personal research France Germany Japan Brazil Russia Recommendations of friends and others I trust India China
Consumer rankings/ratings
Community websites that provide consumer product/service reviews
The salesperson in the store where I shop
Manufacturers website
Ad campaign
None of these
0%
10%
20%
30%
40%
50%
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An Activity-Based View: What are Technology Users Doing?

The top technology-based activities conducted in a typical week include emailing, searching for and reading general news, banking, watching shows and videos, and texting. Just over half of respondents bank online at least weekly. Half of survey respondents text at least weekly, and 14 percent spend more than five hours a week doing so. Thirty-nine percent of respondents connect to a social network in a typical week, and 20 percent spend at least five hours a week at it. They do so from multiple devices (computers, netbooks and tablet PCs, in particular). Thirty-seven percent of respondents said they were interested in using their TV to access Web content, view personal content like photos and download applications.
Activity-Based View | 22
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To better understand how consumers are using the myriad consumer technologies available to them, we asked them a number of questions about the technology-based activities they perform, how frequently they use various applications and which devices they use for different activities. After years of operating in an environment where a specific device was required for a specific activity (such as needing a computer to email or a camera to take photos), many consumers now do activities across numerous technologies, making it far more complex when determining how to predict the growth of a particular consumer technology or application.
What activities are consumers spending time doing?

Emailing is the main activity conducted weekly by survey respondents. It is also the activity that most consumers spend substantial amounts of time doing (Figure 15). In fact, 39 percent of respondents spend at least five hours per week emailingmore often older generations than younger ones. The second most frequent activity is searching for and reading general news and information on the Web, although it has slowed over the past two years. In China, the percentage of respondents who search for content on the Web during an average week has dropped from 84 percent to 61 percent. And, in India, searching the Web for information has dropped from 61 percent of consumers doing it weekly to 47 percent.
Other popular activities include banking, watching shows and videos, and texting. Just over half of respondents bank online at least weekly. While less than half (44 percent) of respondents watch shows, movies or videos each week, those who do spend considerable time at it: 31 percent do this at least five hours per week, ranking it third among the activities consumers spend the most time on each week. Connecting with people on social networks has remained steady year over year, with 39 percent of respondents doing this in a typical week and 20 percent spending at least five hours a week at it in our 2011 report. In the US, interest is higher than average: 46 percent connected at least weekly in both 2009 and 2010. Indias participation in social networking has declined. In 2010, 57 percent connected at least weekly, and for our 2011 study that number has fallen to 42 percent.
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Figure 15. Which of the following activities do you do in a typical week? How much time do you spend?
Time spent on activity: 5+ hours Emailing Searching for/reading general news and information on the Internet Banking Texting/SMS Watching shows/movies/videos Working from home (e.g., checking emails, conference calls) Playing games Connecting with people on social networking sites (e.g., Facebook, Myspace) Listening to music stored on a device Managing personal digital photos and videos Watching/posting videos on the Internet Listening to streamed music on the Internet Downloading and using apps Using maps and global positioning; getting directions from the Web Managing my health Reading blogs or listening to podcasts Base size = 8,002 Base size = 8,002 Participating in communities of interest on the Internet (e.g., Yahoo groups) Reading electronic books Writing blogs or contributing to online references such as Wikipedia Microblogging (e.g., Twitter) 0% 20% 40% 60% 10 9 Rank order: time consumed 15+ hrs 1 5-14 hrs 2
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Overall, about half of survey respondents text at least weekly, and 14 percent spend more than five hours a week doing so (especially, as one would expect, those 18 to 24 years old). In fact, it is in the new and mobile-centric activity categories such as connecting with people on social networks and texting that millennials (those in our survey 18 to 24 years old) are really similar globally. On activities that have been available longer, there is more region-specific behavior.
increasingly using multiple devices for activities that used to be PC-based: 44 percent of netbook owners email from it at least weekly, 40 percent email from their tablet PC and 40 percent email from a mobile or smartphone. The data also shows a downward trend in the use of the PC for some activities. For example, in our 2010 report, 80 percent of US survey respondents emailed from their PC weekly. This year that percentage dropped to 75 percent. During the same period, checking email by phone rose from 14 percent to 24 percent. A similar downward PC usage trend is evident in the email activity in India and China. For activities from microblogging to social networking to managing photos, posting videos, downloading apps or banking, the next-most used devices after a computer are tablet PCs and netbooks. Overall, these three devices have very similar patterns in terms of the activities done on them weekly. For instance, 37 percent connect to social networks from their computer at least weekly, 27 percent connect to social networks via their netbooks each week and 23 percent do so from their tablet PC. When reviewing information on "heavy users" of activitiesthose who do the activity at least five hours per weekinteresting patterns emerge. For instance, among millennials in the BRIC markets who are heavy watchers of shows and videos, a larger share (44 percent) watch them on a PC or laptop than on a television (chosen by 30 percent). A significant number of these young adults also watch videos on their mobile or smartphones. In addition to watching shows and videos, a significant number of consumers reported doing nontraditional activities from their television: 21 percent search the Internet via their television, and 14 percent report emailing from the device.
And among those not already doing so, 37 percent of respondents said they were interested in using their TV to access Web content, view personal content like photos and download applications (Figure 17). Using the TV as a more utilitarian device is more interesting to emerging market respondents than mature market respondents. And younger generations are more interested in the TV as a multi-purpose technology than older ones. The primary activity done on an e-book reader is, as one would expect, reading e-books (33 percent of e-book reader owners do this weekly on the device). But not as intuitive is that the nextmost popular activities done weekly on this device are emailing (21 percent do this) and searching the Internet (19 percent). Of those who dont own an e-book reader, more than half said that it is because they prefer paper books. But 20 percent said they preferred other electronic devices than an e-book reader for reading books, such as a phone, PC or tablet PC. In emerging markets, the percentage of respondents who prefer other electronic media for e-book reading is much higher: 34 percent in BRIC markets versus 7 percent for mature-market countries. Looking across the activities done weekly on various devices, a few patterns become clear. Overall, respondents indicated they clearly prefer to do some activities on mobile or smartphones (texting and email), television (watching shows), and e-book readers (reading). However, for many activities most frequently done on a computer, if a computer is not easily accessible, a respondent is likely to use a mobile phone, tablet PC or netbook. As activities become more and more multi-device, and people more quickly jettison duplicative technologies, the Consumer Technology Power Rankings are likely to show significant shifts in years to come.
The big question: What device for what activity?

Some of the hottest new consumer technologies, such as tablet PCs and smartphones, are able to perform many of the same activities as other wellestablished devices in the marketplace. So to better understand which devices consumers choose for various activities, we queried respondents about the activities they do weekly on mobile or smartphones, laptops, televisions, tablet PCs, netbooks, e-book readers and in cars. The primary lesson from this query is that there are clearly some activities that, in aggregate, survey respondents prefer to conduct on a specific device. For instance, respondents most frequently do texting on their mobile or smartphone. They more frequently watch shows and movies on TV. They listen to music stored on a device more often in the car. And they read e-books more often on an e-book reader, tablet PC or netbook (Figure 16). Perhaps because 93 percent of respondents own computers, the computer or laptop remains the device used by the most respondents for conducting the majority of the 20 different activities we queried about. Across the countries we surveyed, 79 percent of computer owners email from their computer at least weekly. But there is evidence that respondents are
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Figure 15
Figure 16. Top activities conducted in an average week

Searching for/reading general news and information on the Internet Using maps and global positioning; getting directions from the Web Reading blogs or listening to podcasts Writing blogs or contributing to online references such as Wikipedia Microblogging (e.g., Twitter) Participating in communities of interest on the Internet (e.g., Yahoo groups) Connecting with people on social networking sites (e.g., Facebook, Myspace) Texting/SMS Working from home (e.g., checking emails, conference calls) Managing personal digital photos and videos Done on Any Device Done on a Mobile/smartphone Done on a Laptop Done on a Tablet PC Done on a Netbook Done on an E-book Done on a TV Done in a Car
Playing games Listening to music stored on a device Listening to streamed music on the Internet Emailing
Watching show/movies/videos
Watching/posting videos on the Internet Reading electronic books
Downloading and using apps
Managing my health
Banking 0% 20% 40% 60% 80% 100%
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Figure 16
Figure 17. Interest in TV for accessing Web content, photos, apps

Total Mature markets Emerging markets 18-24 25-34 35-44 45-54 55 or older 0% 10% 20% 30% 40% 50%
Figure 17
Computer (desktop or laptop) Mobile phone Web-enabled mobile phone/smartphone Digital photo camera DVD player Regular (CRT or tube) TV High-definition plasma or LCD TV Portable music player Game console VCR Digital video camera Portable gaming device Digital video recorder for TV GPS device Netbook Blu-ray player E-book 3-D TV Health and Fitness device Tablet PC 0% 20% 40% 60% 80% 100%
2011 2010 2009 2008
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A Look at the US Market

Accenture has now researched consumer technology adoption among US consumers for four consecutive years. While some of the research areas have changed to stay consistent with the most contemporary issues and technologies, many have remained, which enables us to present some of the most interesting trends since our research began. The trends in ownership of various devices in the US support Accentures global observation that newer technologies and technology upgrades are rapidly making certain devices obsolete. For instance, mobile phone ownership has dropped from 79 percent in our 2008 report to 65 percent in this years report, while smartphone ownership has quadrupled from 8 percent to 32 percent in the same period (Figure 18). These same trends are apparent when comparing DVD player decline versus Blu-ray player growth, regular TV decline versus high-definition TV growth and VCR decline versus DVR growth. This power shift has occurred while the computer has remained ubiquitous but in slight ownership decline.
US Market | 27
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The Total most-purchased
consumer electronics in 2010 in the US include the computer, smartphone and highMature markets definition TV. However, while about the same percent of consumers Emerging markets surveyed purchased a computer and high-definition TV in 2010 as in 2009, 18-24 smartphones showed a significant jump in those purchasing one in 2010 versus 25-34 (from 14 percent buying in 2009 2009 to 22 percent buying in 2010).
35-44
The US data reflects flat to declining spending on consumer electronics amid 45-54 the recession years. In fact, 2010s spending virtually mirrored 2009, with 55 or older slightly more consumers spending slightly lesser amounts in 2010 than in 0% 10% the prior year (Figure 19).
Among the newer technology-based activities across our four-year history is connecting on social networks. One of the most interesting findings here this year are the reasons for using social networks: The top two choices increased significantly in the past year, and they both involve strengthening existing relationships instead of creating new ones (Figure 20). As older individuals tend to be much less focused on making new friends than on keeping in touch with current ones, the increase in older generations use of social media may be influencing how these networks are being used.
20% 30% 40% 50%
Figure 17
Figure 18. US trends in consumer electronics ownership
Computer (desktop or laptop) Mobile phone Web-enabled mobile phone/smartphone Digital photo camera DVD player Regular (CRT or tube) TV High-definition plasma or LCD TV Portable music player Game console VCR Digital video camera Portable gaming device Digital video recorder for TV GPS device Netbook Blu-ray player E-book 3-D TV Health and Fitness device Tablet PC 0% 20% 40% 60% 80% 100%
2011 2010 2009 2008
US Market | 28
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Figure 18 Figure 18
Figure 19. US spending on consumer electronics

Have not spent any money on consumer electronics Have not spent any money in the past year on consumer electronics in the past year Less than $500 Less than $500 2010 2010 2009 2009 2008 2008 2007 2007
$500 to less than $1,500 $500 to less than $1,500
$1,500 to less than $3,000 $1,500 to less than $3,000
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Dont know Dont know 0% 0% 10% 10% 20% 20% 30% 30% 40% 40% 50% 50%
Figure 20. US consumers' reasons for connecting on social networks

Reconnect with old friends Reconnect with old friends Stay in touch with friends Stay in touch with friends Make new friends Make new friends Network with current and former colleagues Network with current and former colleagues To let others know what I'm doing To let others know what I'm doing To inform others of personal news To inform others of personal news To connect with people who share common bonds who To connect with people share common bonds To let others know my opinions To let others know my opinions To find out about products and services To find out about products and services To plan social activities To plan social activities To look for jobs To look for jobs To write about and review products To write about and review products To be engaged in local community To be engaged in local community To sell things To sell things To further issues that are important to me To further issues that are important to me To play games To play games 0% 0% 2011 2011 2010 2010
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Figure 19 US Market | 29 Figure 19
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Implications for the Consumer Technology Industry

With so many activities becoming device agnostic, and people more willing (at least in emerging markets) to jettison what they perceive to be duplicative technologies, what does that mean for the growth of certain technologies? Will we begin to see a gradual culling of the herd where technologies considered obsolete or unnecessary will be disposed of altogether? Are single-purpose technologies (such as photo and video cameras) differentiated enough in purpose and quality to maintain their lifeline? Is the insatiable appetite for technology among emerging markets enough for all players in the consumer electronics industry to thrive? While many questions regarding the growth of consumer electronics cannot be answered, one thing is clear: Not only is it becoming more difficult to predict the winners and losers in consumer technology, but it also is getting tougher to develop products that can appeal to an increasingly diverse global customer base with unique local needs and requirements. To win in such a world, consumer technology companies must engage with consumers at the onset of, and throughout, the innovation process. Achieving high levels of engagement requires consumer technology companies to rethink how they manage innovation on a global basis.
Consumer Technology Companies | 30
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Minding the foundation

For example, consumer technology companies must pay particular attention to what Accenture considers the foundational elements of a robust innovation capability: innovation strategy, innovation leadership, customer understanding and idea sourcing. Innovation strategy: Successful innovation requires a commitment to the companys innovation strategy, which includes investing a substantial percentage of revenue in innovation activities and maintaining the investment level and commitment even during challenging economic cycles. Innovation leadership: A significant contributor to innovation success is executives who are committed to innovation and who instill within their employees and throughout the organization a similar self-confidence and willingness to never stop innovating. Customer understanding: In todays dynamic world, superior innovation requires conducting a considerable amount of research on consumer behaviornot only traditional market research studies, but observational and ethnographic research as well. Idea sourcing: As markets continue to get more competitive and the cost of developing new products continues to rise, consumer technology companies are challenged to look far beyond their research and development group for other sources of innovationespecially those outside the company, including ecosystem partners, academia and customers.
Distributing innovation
Innovation is no longer the exclusive province of developed markets. A combination of investment, education and a strategic policy focus on new technologies has spurred the development of new clusters of innovation in emerging economies. In recent years, for example, we have witnessed the rise of nanotechnologies and biotech in Beijing, digital media and genomics in Seoul, biofuels in Brazil, and automotive technologies in Poland. Excelling at innovation requires a focus not only on input factors (such as investment in R&D and education) but also on measuring output (such as the ability to produce valuable new products, services and business processes). For a business, unpacking innovation in this way is essential when making decisions about where to locate innovation functions. Indeed, high-performance businesses are clearly aware that there are now many more innovation hubs and untapped sources of expertise outside their home markets. In fact, these companies typically source innovation from more than one country, which enables them to be authentically local while operating globally. In other words, when it comes to operating in local markets, high performers dont just switch the label on the can. Instead, they immerse themselves in the markets to become part of the local business and social fabric, adapting their strategies, operations and products to meet local conditions and tastes. For consumer technology companies, such distributed innovation has become increasingly critical to creating products that reflect the disparity in preferences and needs in consumers from country to country.
Maintaining product pipeline discipline

For consumer technology companies, having a consistent end-to-end innovation process with clear stage gates and milestones is absolutely critical. Organizations need a good ideageneration process that leads to asking the right questions that can lead to the highest-quality, most refined ideas, so the company can decide on which ideas it will focus its scarce resources on and how. For instance, at the start of an innovation process, a company could have 10 ideas. But it needs to quickly understand the risks and opportunities of each so that it can narrow the pool to the three ideas, or even one idea, in which it will invest money to create a new product. In Accentures experience, this is not common: Most consumer technology companies typically only loosely adhere to a consistent process and, even then, only for incremental innovations. When it comes to the innovation process, high performers adhere to stage gates and actively attempt to optimize their end-to-end process to cut development cycle times. High performers have made huge leaps in their development cycle times by streamlining their innovation processes and, consequently, have been able to increase the number of new product launches. High performers also tend to build a balanced portfolio of strategic short- and long-term incremental and groundbreaking innovation initiatives. In other words, while they know they must continue to develop products that keep the lights on today, they also recognize that they need to mix in some larger big-bet initiatives that, if successful, could completely change the game.
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Executing consistently over time

The consumer technology space is littered with one-hit wonders: companies that came up with a compelling product but were unable to sustain innovation to keep churning out new, desirable products over the longer term. In many instances, such lack of staying power was due to shortcomings in how the companies innovation functions were structured, measured and rewarded. Accenture has found in its research as well as client work that one of the biggest keys to sustained innovation is a culture that tolerates risk, rewards failure and encourages continuous improvement. Without such a culture, breakthrough ideas are impossible to consistently and fully identify and capitalize upon. Furthermore, without the ability to measure past successes and estimate the future market impact of new products, companies will continue to fly blind and approach innovation as an ad hoc exercise. For many consumer technology companies, succeeding as an integral part of the consumer lifestyle will require substantive rethinking of their innovation engines. By paying attention to the foundational elements, distributing innovation, remaining disciplined in the product development process and executing consistently over time, consumer technology companies can engage with consumers throughout the innovation process and appeal to the increasingly diverse and rapidly changing consumer needs and preferences highlighted in this report.
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Snapshots of Hot Technologies
Snapshots of Hot Technologies | 33
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Figure 21
To stay in touch with friends Reconnect with old friends
The tablet PC: The hot consumer electronic
Total US France Germany Japan Brazil Russia India China
The tablet PC is gaining market momentum. One need only look at the millions of sales of iPads and Galaxy Tab tablet computers since they were each launched To network withknow that this device is rapidly becoming popular among consumers. in 2010 to current and
former colleagues To make new friends, meet According to Accentures new people
research, 8 percent of consumers surveyed now own a tablet PC and aboutshare one-third of those individuals (3 percent total) purchased To connect with people who common bonds (e.g., music, new moms) their tablet PC in 2010 (Figure 21). Eight percent of respondents globally plan To let others know about my opinions 2011a purchase rate that would double tablet PC to purchase a tablet PC in (political, social, etc.) ownership globally in just one year. To find out about products and services
I plan to purchase To play games
BRIC market consumers are more enthusiastic purchasers of tablet PCs than are mature-market consumers. More than double the percentage of BRIC consumers currently own one, and double the consumers plan to buy one in To plan social activities 2011, than consumers in mature markets. But what is most astounding about To further issues that are important to me (i.e., political, environmental) is that nearly one-quarter of Chinese respondents (across tablet PC consumption ages within my local areas) currently own one. That is nearly three times the global To be engaged in urban community average. The purchase rate in China was more than double the global average in To write about and review products 2010. And looking forward, China is potentially the strongest market for tablet PCs this year, with 18 percent of Chinese respondents planning to purchase To look for jobs one in 2011. If one does the math, tablet PC ownership would reach almost 40 To sell things the urban adult population of China by 2012. percent of
0% 20% 40% 60% 80% 100%
Figure 21. Tablet PC own, bought, plan to buy

Total Mature markets Emerging markets France Germany Japan US Brazil China India Russia 0% 5% 10% 15% 20% 25% Own a tablet PC Purchased a tablet PC in the past 12 months Plan to buy a tablet PC within the next 12 months
Figure 22 Snapshots of Hot Technologies | 34
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Although far behind China in consumption, India has the second-highest penetration of tablet PCs globally, with 10 percent of consumers owning one. Future growth for tablet PCs in India also looks strong: 10 percent of Indian respondents plan to purchase a tablet PC in 2011. Interestingly, Indian consumers seem less committed to the new technology than other countries. Five percent of those owning a tablet PC quit using it last year because they had the same functionality in another device (globally, the defection rate for tablet PCs was 2 percent). The activities most often conducted on a tablet PC mirror those conducted on a laptop or desktop computer and include checking email, browsing the Web, watching videos, and reading books, newspapers and magazines (Figure 22). Emerging-market countries use their tablet PCs for a wider variety of activities than do mature-market countries. The largest differences are in tweeting and microblogging: 43 percent of emerging-market respondents use a tablet PC for microblogging, versus only 26 percent of tablet PC owners in maturemarket countries. People between 18 and 24 years of age conduct a greater number of activities on the tablet PC, including such things as email, games, banking, blogging, watching videos, listening to music and managing photos. Other generations lean more toward using the tablet PC for just a few applications, namely email, browsing the Web, watching videos and reading.
Figure 23
Figure 22. Activities conducted on a tablet PC

Browsing the Web Checking email Watching videos Reading books, newspapers, magazines Listening to music Taking and/or managing photos Banking Using the applications that came already installed on my tablet PC Playing games Updating and checking my social network sites Services based on my location Using custom or self-purchased applications Tweeting or microblogging 0% 10% 20% 30% 40% 50% 60% 70% 80% Total Mature markets BRIC markets
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Figure 23
3-D TV: Whats the real story?

The 3-D TV sits dead last among the consumer technologies in Accentures 2011 Power Rankings because only 3 percent of the survey population currently owns one (Figure 23). However, the 3-D TV also is predicted to have the highest change in purchase ratea staggering 500 percent increasein the next 12 Browsing the Web months. So whats the real scoop on the 3-D TV? China once again stands out as the most enthusiastic consumer of new technologies. While 2 to 3 percent of consumers in most countries own a 3-D Watching videos TV, double that amount own one in China. And growth plans for 3-D TVs in Reading books, newspapers, the BRIC markets are promising. During 2011, one-fifth of consumers in Brazil magazines and India, 16 percent in Russia, and 14 percent in China plan to purchase a Listening to music 3-D TV. This is in stark contrast to just 2 percent of consumers in Japan, 6 Taking and/or France and percent in managing photosGermany, and 8 percent in the United States.
Banking Of those who dont currently own a 3-D TV, overall interest in 3-D TV is split:applications that came Using the 49 percent globally say they are interested in owning a 3-D TV already installed on my tablet PC and 51 percent say they arent. Interest is far greater among the younger generations: 63 percent of those 55 or older said they were not interested Playing games in 3-D TV ownership, versus 45 percent of those under 25 and 46 percent Updating and checking my of those aged 25-34. social network sites Services based on my location In addition, there is much more interest in 3-D TV among emerging-market consumersor self-purchased Using custom than mature-market consumers. Two-thirds of emerging-market applications respondents said theyd like to have a 3-D TV versus only 31 percent of matureTweeting respondents. market or microblogging This interest within emerging markets holds steady across generations. Digging deeper into these market differences, its clear that 0% 10% 20% 30% 40% 50% countries differ significantly in consumer interest in this device. For example, 69 percent of Chinese and 68 percent of Russians want or plan to own a 3-D TV, versus only one-fourth of US consumers and one-fifth of consumers in Japan. Checking email
Total Mature markets BRIC markets
60%
70%
80%
Figure 23. Ownership of 3-D TV; plans to purchase 3-D TV

Total France Germany Japan US Brazil China India Russia 0% 5% 10% 15% 20% Own a 3-D TV Purchased a 3-D TV in the past 12 months Plan to buy a 3-D TV within the next 12 months
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As consumer electronics companies consider ways to increase demand for 3-D TVs, it appears price is the biggest lever that would drive more interest in this new device (Figure 24). Fifty-seven percent of respondents globally said they would be more inclined to purchase a 3-D TV if the price was within their budget. Finding a price within their budget was more significant among people under 24 years old than older people (64 percent versus 50 percent, respectively). And finding a price within budget is a bigger driver of 3-D TV purchase interest in emerging countries than in mature ones. Other (but lesser) factors that would make consumers more inclined to purchase a 3-D TV include having greater availability of 3-D content and not having to wear 3-D glasses. Almost half (45 percent) of respondents in China and Germany said theyd be more inclined to buy a 3-D TV if they didnt have to wear glasses. And also, in China, 63 percent said theyd be more interested in 3-D TV if there were more content available.
Figure 25
Figure 24. Factors that would make consumers more inclined to purchase a 3-D TV
Total If the price were within my budget Mature markets Emerging markets 18-24 If 3-D televisions were available in my market 25-34 35-44 45-54 55 or older If they were easier to use
If there were more 3-D content available
If I did not have to wear 3-D glasses
I have no interest in 3-D television
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Social networking: A hot pastime

In a typical week, 39 percent of consumers surveyed across geographies and age groups connect with friends using social media (Figure 25). Despite the rise of well-known US-based brand Facebook, the US is not where social networking is most extensive. Russia and Brazil lead other countries in their social media use. In fact, 54 percent of Russian respondents connect to social networks in an average week and half of those in Brazil do as well. In the US, just less than half of respondents (46 percent) connect on social media sites in an average week. While more younger-generation consumers are using social media, its not purely a younger-generation activity. One-third of those 45 to 54 years of age connect on social media weekly and more than one-quarter of those 55 years or older do so. The age gap in social media activity is significantly smaller in BRIC markets than in the US, Japan, Germany or France. In the BRIC markets, 51 percent of those 18-24 connect, but 42 percent of those over 55 do so as well.
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Figure 25. Percentage of respondents connecting to social media in a typical week

Total France Germany Japan US Brazil China India Russia
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At an aggregate level, the reasons respondents cited for using social media are largely social versus commercial: to stay in touch with friends (82 percent) and to reconnect with old friends (71 percent). Across our global sample, few respondents indicated that they used social media for commercial reasons such as to sell things or look for a job, or as a platform to further their opinions and causes. In fact, only 20 percent use social networking to write about and review products and 22 percent use it to further issues important to them (Figure 26). However, BRIC countries have a broader number of uses for social networking than mature-market countries. In addition to connecting with friends, consumers in China and Brazil, in particular, more frequently use social networking to sell things, look for jobs, further issues important to them and write about and review products.
Figure 21
Figure 26. Activities done on social media

To stay in touch with friends Total US France Reconnect with old friends To network with current and former colleagues To make new friends, meet new people To connect with people who share common bonds (e.g., music, new moms) To let others know about my opinions (political, social, etc.) To find out about products and services I plan to purchase To play games Germany Japan Brazil Russia India China
To plan social activities To further issues that are important to me (e.g., political, environmental) To be engaged in my local community To write about and review products To look for jobs
To sell things 0% 20% 40% 60% 80% 100%
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Smartphones: The strong utility player on the device team

At number 10 in the Power Rankings, the smartphone is expected to remain strong in both purchase and use in 2011. Globally, more than one-fourth of the survey population owns a smartphone (Figure 27). China, again, is the geography with the most enthusiastic consumption: More than one-half of Chinese respondents in our survey currently own a smartphone, compared with one-third of US respondents. Chinese enthusiasm is fairly new as well. Thirtyseven percent of Chinese respondents purchased their smartphones in 2010 (representing more than half of those who now own one). And smartphones are predicted to be the most-purchased device in China in 2011, with 38 percent planning to buy one. Smartphones are expected to have the second-highest purchase rate among consumer electronics in 2011. About one-quarter of respondents plan to purchase one in 2011 (Figure 28). In addition to China, the smartphone is predicted to be the most-purchased device in India and Russia and the secondmost purchased device in Brazil, Germany, the US and France. Besides making phone calls, the smartphone applications rated most valuable to consumers are texting, taking photos, checking email and browsing the Web (Figure 29). These activities are all more important to younger generations than older ones.
Figure 26 in smartphone
In addition, consumers of different economies also have different interests applications. Listening to music was a more popular smartphone activity in emerging markets (led by younger generations).
Figure 27. Smartphone ownership
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Reading books, magazines and newspapers was a top smartphone application for 13 percent of emerging-market respondents, compared with just 3 percent of those in mature markets. Mature-market countries exhibit big differences in application preferences between younger and older generations. In these countries, more than half of adult consumers under 25 years old ranked texting as a top-three smartphone application, while only 21 percent of those over 55 did so. While consumer interest in smartphones is high, competition among various smartphone alternatives is extensive as well. So how can consumer electronics companies recoup innovation investments, protect margins and capture growth in this fiercely competitive, rapidly growing market? Accentures data indicates that commanding a premium for ever-faster and smarter smartphones could be tough. Just over one-third of respondents said they would not be willing to pay a premium for any of the five enhanced capabilities we queried about (Figure 30). In fact, respondents were evenly divided about what, if anything, warranted a premium price. Older generations were far less interested in paying a premium for enhanced smartphone capabilities. And consumers in mature markets are far less willing to pay for various enhancements to smartphones than emerging markets. Fifty-nine percent of mature-market respondents said they would not pay a premium for enhanced Web browsing, thousands more applications, enhanced location awareness, faster downloading or enhanced touchscreen. This compares with only 17 percent of those in emerging markets.
Figure 27
Figure 28. Smartphone purchasing trends

Total France Germany Japan US Purchased a smartphone in 2010 Brazil China India Russia
Plan to purchase a smartphone in 2011
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Figure 28
Checking email
Figure 29. Top 3 most valuable smartphone applications
Checking email Texting/text messaging Texting/text the Web Browsing on messaging Browsing Banking on the Web Banking Watching videos Watching Tweeting videos Tweeting Updating and checking your social network sites Updating and checking your social network sites Shooting videos Shooting to music Listening videos Listening to music Reading books, newspapers, magazines Reading books, Playing games newspapers, magazines Playing games Taking photos Taking photos Using custom or self-purchased applications (e.g., applications that did not come as standard on your device, but rather were Using custom or self-purchased applications (e.g., applications downloaded or purchased separately) that did based on as location on your device, but rather were Services not come my standard (e.g., GPS or maps/directions, downloaded or purchased restaurant suggestions) separately) Services my mobile phone/smartphone or maps/directions, I just usebased on my location (e.g., GPS to make phone calls restaurant suggestions) I just use my a mobile phone/smartphone I do not own mobile phone/smartphone to make phone calls I do not Other own a mobile phone/smartphone Other 0 0 Checking email Checking email Texting/text messaging Texting/text messaging Browsing on the Web Browsing on the Web Banking Banking videos Watching Watching videos Tweeting Tweeting and checking your social network sites Updating Updating videos Shooting and checking your social network sites Shooting videos Listening to music Listeningbooks, newspapers, magazines Reading to music Readinggames newspapers, magazines Playing books, Playingphotos Taking games Using photos Takingcustom or self-purchased applications (e.g., applications that did not come as standard on your device, but rather were Using custom or self-purchased applications (e.g., applications downloaded or purchased separately) that did not come as standard on your device, but rather were Services based on my location (e.g., GPS or maps/directions, downloaded or purchased separately) restaurant suggestions) Services based on my location (e.g., GPS or maps/directions, I just use my mobile phone/smartphone to make phone calls restaurant suggestions) I just use my mobile phone/smartphone to make phone calls do not own a mobile phone/smartphone I do not own a mobile phone/smartphone Other Other 0 10 10 20 20 Retweet 30 40 50 50 Previous 60 60 10 10 20 20 30 30 40 40 50 50 60 60
Mature markets
Total Mature markets 18-24 Total years 25-34 years 18-24 years 35-44 25-34 years 45-54 years 35-44 55 or years 45-54older 55 or older
Emerging markets
18-24 years Emerging markets 25-34 years 18-24 years 35-44 25-34 years 45-54 years 35-44 55 or years 45-54older 55 or older
30 40 Table of Contents
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Figure 29
Figure 30. Willingness to pay a premium for smartphone enhancements

Total Thousands more applications Mature markets Emerging markets 18-24 25-34 A more enhanced Web browsing experience 35-44 45-54 55 or older Higher-resolution touch screen
Enhanced location awareness (e.g., your smartphone would know where you are and can provide local information on your current surroundings) Faster downloading and data access
None of the above
0%
10%
20%
30%
40%
50%
60%
Snapshots of Hot Technologies | 43 Figure 24
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Accenture GlobalConsumerTech 2011

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Preferred LetterEmergence of a Alternate Letter Finding Growth: Brochure Title Technology Paradigm Brochure Title New Consumer

A widening enthusiasm gap

A new consumer technology paradigm

Surprises in the ranks of the most popular apps

Multi-device application use on the rise

Innovation and environmental responsibility remain strong drivers of growth

About the Research

About the Research | 6

Figure 1. Respondent demographics

50% 24% 19%

25-34 years 35-44 years 45-54 years

Gender 50% 50%

Germany Japan Brazil

Russia India China

About the Research | 7

"Hot and Not" Technologies: Consumer Technology Ownership Patterns

"Hot and Not" Technologies | 8

"Hot and Not" Technologies | 9

"Hot and Not" Technologies | 10

Figure 3. Country breakdown of device ownership

Portable music player

Health and fitness device

Digital video camera

Portable gaming device

3-D TV 0% 20% 40% 60% 80% 100%

"Hot and Not" Technologies | 11

Figure 4. Generational differences in device ownership

"Hot and Not" Technologies | 12

What was purchased in 2010

What is being discarded as obsolete

What consumers plan to purchase in 2011

The most-used consumer technologies

"Hot and Not" Technologies | 13

Figure 5. Devices purchased in 2010

Portable music player

Health and fitness device

Digital video camera

Portable gaming device

None 0% 10% 20% 30% 40% 50% 60%

"Hot and Not" Technologies | 14

Figure 6. Intentions to purchase in 2011

Figure 7 and Not" Technologies | 15 "Hot Figure 7

Figure 8. Most frequently used technologies

The most-used technology services

Percent of respondents ranking within the top 3 most frequently used

Figure 9. Most frequently used technology services

Mobile phone service

Mobile data service for my laptop

VoIP phone service (e.g., Vonage, Skype)

"Hot and Not" Technologies | 16

Figure 10. Importance of consumer electronics relative to other categories of spending

Entertainment and recreation services

Healthcare and well-being products

Where's the Opportunity? | 18

Figure 11. Amount spent on consumer electronics in 2010

Figure 12. Consumers intentions to spend on consumer technologies in 2011

$1,500 to less than $3,000

Where's the Opportunity? | 19

US Less than $500

$500 to less than $1,500

Figure 13. Willingness to pay a premium for environmentally friendly products

Where's the Opportunity? | 20