High-tech giving

MP3 players and plasma-screen TVs move to the top of holiday shopping lists


Eric Strassman's holiday shopping list used to include more toys, sweaters and jewelry than any electronics gear.

Now, technology plays a bigger part - making up half of his shopping list, thanks to lower prices and more choices.

"Buying a camera 10 years ago, you had one choice. You bought the instant camera or the 35 mm. Now you have the digital," said Strassman, who lives in Lutherville. "If you wanted audio equipment, you either bought a cheap stereo or expensive stereo. Now, you have MP3 players and iPods."

Technology is bucking traditional "must have" items on gift lists and has secured its spot as the "it" thing for most shoppers.

From big-screen televisions for adults, MP3 players for teens and robotic toys for children, the skyrocketing popularity of electronics is transforming the holiday shopping experience. Americans are spending a growing portion of their holiday budgets on electronics because of falling prices, easier-to- use products and the constant evolution of better, faster and more convenient technology.

The desire for technology is increasing as "electronics are part of more people's lives," said Stephen Baker, vice president of industry analysis at the NPD Group, a marketing company in Port Washington, N.Y.

"Ten years ago, that wasn't really the case."

MP3 players and plasma-screen televisions are this year's must-have high-tech gifts, according to the Consumer Electronics Association. And 77 percent of 1,000 randomly selected adults who were interviewed by the trade group said they were likely to buy an electronic product as a holiday gift this year.

In recent holiday seasons, portable DVD players, digital cameras and iPods have been big sellers - with newer models creating more buzz this year.

"I think you have a consistent flow of bigger and better, and newer and improved products each year that consumers are paying attention to," said Sean Wargo, director of industry analysis for the Consumer Electronics Association, a trade group in Arlington, Va. "In the TV market, along with plasma and LCD [liquid crystal display], there's a huge array of options for the consumers. You add to that, a relatively new category of MP3 players and digital cameras. They're getting their second wind."

Chris Byrne, a toy consultant in New York, said technology is changing what defines a toy and "blurring the definition of consumer electronics and a toy."

"What's hot is not for tech's sake. It's technology that adds functionality," Byrne said. "A toy that you simply wind up and watch doesn't appeal to kids."

Video games and game units are all the rage for children this holiday season, according to the National Retail Foundation. Though traditional wares like Barbie dolls and LEGOs are still popular, gadgets like iPods and other digital music players are making a mark on the girls' wish lists, while boys want gaming consoles.

The new gaming console Xbox 360, billed as an all-around entertainment system, was released Tuesday to much anticipation, creating a demand frenzy. Microsoft Corp. isn't saying how many consoles were available for sale, but whatever was available seemed to sell quickly.

At the Timonium Best Buy, the Xbox units were gone within 45 minutes Tuesday morning, said sales manager Jim Miller. Some customers lined up the day before to be the first ones to get the consoles, he said.

Sales skyrocketing

Sales of consumer electronic products have been skyrocketing, growing into a $123 billion industry. In the past five years, the industry has grown 31 percent, from $93.7 billion in 2001, according to the Consumer Electronics Association.

The electronics trade group predicted that Americans would spend $17 billion on electronic gift products alone this holiday season. While overall holiday retail growth projections range from 4 percent to 7 percent, the trade group expects a 9 percent increase in revenue for electronics sales.

"We're becoming a bigger piece of the pie," Wargo said.

Plasma TV set sales are projected to more than double this year, to 2 million, with a third of the sales occurring during the fourth quarter, according to the Consumer Electronics Association. At the same time, the price tag for an entry-level, enhanced-definition plasma television now runs just under $1,000 this year, compared with $1,400 last year, according to the trade group.

Other technology is seeing similar price reductions.

"To some extent, we're seeing absolute cheaper products, like MP3 players, in terms of gift-giving," Baker said. "It's easy to give a PC that costs only $500. Cell phones are $50 versus $150. That's something you could easily manage as a gift.

"Electronics has emerged over the past five to 10 years as one of the biggest gift-giving categories there is," Baker said.

Gadgets have become cheaper and cooler. But Erik Gordon, a marketing professor at the Johns Hopkins University, has another theory as to why technology and electronics top holiday wish lists again this year - there's no must-have toy or apparel item.

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