Hear the 2016 holiday shopping forecast from Shawn DuBravac and Steve Koenig of the Consumer Technology Association (CTA).

2. CTA’s
23rd Annual
Holiday
Outlook
Shawn DuBravac, Ph.D., CFA
Chief Economist
shawnd@CTA.tech
@shawndubravac
Steve Koenig
Sr. Director, Market Research
skoenig@CTA.tech
@koenigsteve

3. Scoring Our 2015 Holiday Forecast

4. 2015 Holiday Forecast Assessment
Series
Projected 2015
Holiday Growth
Actual 2015 Holiday
Growth
Overall Retail Sales 3.4% 3.9%
GAFO Retail Sales 1.7% 0.7%
Electronics Retailers 1.9% -5.4%
Online Sales 13.9% 14.8%
Mobile Sales 34.7% 50.9%
Consumer Spending on
Tech
2.3% 1.4%

5. Looking Ahead to Holiday 2016

6. 2016 Holiday Forecast
Series Projected 2016 Holiday Growth
Overall Retail Sales 3.8%
GAFO Retail Sales 0.5%
Electronics Retailers -2.9%
Online Sales 16.4%
Mobile Sales 45.2%
Consumer Spending on Tech 3.1%

7. CTA Forecast: Holiday Tech Spending up 3.1%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Consumer Holiday Spending on Tech Forecast 10-yr Average (4.7%) 20-yr Average (6.7%)

8. Key Holiday 2016 Themes
1. Sentiment: Mixed Signals
2. Existing Tech Stays Strong
3. Emerging Tech Percolates In Gifting Plans
4. Online (led by mobile) Defines Growth Profile
5. Rapidness of Online (Deals) Creates Isolation

9. #1 Sentiment: Mixed Signals

10. 2010
65%
2011
76%
2012
80%
2013
86%
2014
87%
2015
88%
2016
92%
% of consumers planning to spend money on holiday gifts
Holiday Gift Buying Plans
2016 = 227 million U.S. adult gift givers

11. Consumer Tech is the Gift to Give
2012
77%
% of gift buyers planning to buy tech as holiday gifts
2010
76%
77%
2011
Q: B21: What % of your holiday gift spending will be on consumer electronics?
Base: random national sample of 1,005 U.S. adults
2013
74%
2014
73%
2015
74%
2016
75%

12. % of U.S. Adults Buying Technology Gifts

13. CTA Sentiment Tracking Steadily Higher
0
20
40
60
80
100
120
140
145
150
155
160
165
170
175
180
185
2007 2008 2009 2010 2011 2012 2013 2014
CEA Index of Consumer Expectations (Left) CEA Index of Consumer Technology Expectations (Right)
13

14. -15%
-10%
-5%
0%
5%
10%
15%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revolving Credit (Y/Y % Change)
Consumer Credit Growing Again

15. Holiday Gift Spending Trend

16. Shifts in Holiday Gift Spending Plans
Spend More
Spend Same
Spend Less

17. Allocation of Gift Spending on Tech
Base: random national sample of 1,005 U.S. adults
2008 2009 2010 2011 2012 2013 2014 2015 2016
% of gift
spending on CT
28% 29% 32% 32% 30% 33% 32% 32% 30%
Amount $222 $222 $245 $251 $258 $248 $286 $287 $241
-16%
Spend Less:
30%; $96
Spend More:
16%; $603
2016 Average
Tech Gift Spending:
Q: B21: What percent of you gift budget will be spent on CE this holiday?
2015: 18%, $326 2015: 28%, $194

18. Top 20% Captured over 80% of Income Growth
$(2,000)
$-
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
Lowest Second Third Fourth Highest
2008-2012 2008-2014
Average annual income changes by income quintile between 2008 and 2014

19. Top 20% Account for 50% of Spending Increase
$(1,000)
$-
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
Lowest Second Third Fourth Highest
2008-2012 2008-2014
Average annual expenditure changes by income quintile between 2008 and 2014

20. 2011 2012 2013 2014 2015 2016
Don't have the money 71% 62% 66% 53% 44% 60%
Increased cost of living 59% 56% 64% 50% 38% 57%
Fixed Income 60% 48% 56% 48% 44% 54%
Concerns with the economy 77% 66% 68% 46% 36% 46%
Have What You Need 55% 57% 67% 47% 38% 45%
Earning less money 52% 52% 49% 37% 38% 40%
Concerned with the Presidential Election Outcome 38%
Lost Job / Unemployed 37% 34% 34% 18% 25% 27%
Stock Market / Investment Concerns 42% 22% 26% 20% 17% 18%
Lower Spenders: Other Spending Priorities?
Reasons to Adjust Holiday Expenditures Much Higher This Year
QB18: You indicated you plan to spend less this year than last. Which of the following, if any, are reasons why you plan to spend less on gifts this year?
Base: random national sample of 1,005 U.S. adults

21. How much consumers will spend on technology products?
More Less Much more The same
11%16%17%56%
61% 20% 8% 13%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
More Less Much more The same
11%16%17%56%
61% 20% 8% 13%
Strength Meter
How strongly
espondents felt about
heir answers
% of People
Response Mix
Likelihood
% Probability
re Less Much more The same
11%16%17%%
% 20% 8% 13%
More Less Much mor
16%17%56%
61% 20% 8%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
More Less Much more The same
11%16%17%56%
61% 20% 8% 13%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
Last holiday season, total consumer purchases of technology products averaged $274 per person.
Compared to last year's holiday season, how much do you think, on average, consumers will spend on
technology products this holiday season?

22. Growth rate for technology products?
0% (no growth) 5% or more 3.5% 3.6% to less than 5%
More than 0%, but less
than 2%
12%16%16%20%28%
29% 16% 17% 19% 16%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
2% to less than 3.5%
8%
9%
3.5% 3.6% to less than 5%
More than 0%, but less
than 2%
12%16%16%
17% 19% 16%
0% (no growth) 5% or more 3.5% 3.6% to less than 5%
More than 0%, but le
than 2%
12%16%16%20%28%
29% 16% 17% 19% 16%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
0% (no growth) 5% or more 3.5% 3.6% to less than 5%
More than 0%, but less
than 2%
12%16%16%20%28%
29% 16% 17% 19% 16%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
0% (no growth) 5% or more
20%28%
29% 16%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
Last holiday season, total consumer purchases of technology products experienced a growth rate of
approximately 3.5% over the previous 2014 holiday season. Compared to last year (2015), the
growth rate for technology products this coming holiday season (2016) will be?

23. #2 Existing Tech Stays Strong
#3 Emerging Tech Percolates

24. Most Requested
2016 Holiday Tech Gift Wish List - Adults
Smartphone, 8%
TV, 8%
Tablet, 7%
Smartwatch, 3%
Portable GPS, 2%
VG console, 5%
Notebook, 11%VR Headset, 2%
Home Robotic
Vacuum, 2%

25. Innovation Continues to Grow Into Holiday Gift Mix
Purchase Intent – Yes/Maybe
Base: random national sample of 1,005 U.S. adults

26. Holiday Tech Gifts: Computers & Smartphone Devices
eReader
12% (14%)
Notebook
23%
Tablet
22% (26%) External Storage
15% (14%)
Computing
53%
Smartphone
26% (24%)
2016 % (2015 %)

27. Tablet Forecast
U.S. Unit Shipments (000s)
-2% -6%
-7% -1% -2%
Source: CTA, July 2016 Consumer Tech Sales and Forecasts

28. Feature % of Laptop Buyers
2015 2016
Touch Screen 73% 56%
Hybrid PC 61% 45%
Chromebook -- 19%
Laptop Features

29. Smartphone Forecast
U.S. Unit Shipments (000s)
5% -2%
-3%
-3%
-2%
-4%
Source: CTA, July 2016 Consumer Tech Sales and Forecasts
2016 HH
Penetration
74%*
+2pts from
2015
* CTA, 18th Annual Consumer Technology Ownership Study, March 2016

30. Holiday Tech Gifts: Video & Imaging Devices
Video
34%
TV 18% (17%)
Digital Media Player
18% (16%)
Blu-ray or DVD Player
12% (15%)
Action Camera
12%
Camcorder 6%
Digital Camera
(Any Type)
13% (14%)
Digital
Imaging
24%
(22%)
360-degree camera 6%
Ultra HD
Blu-ray Player
7%
2016 % (2015 %)

31. 4K Ultra HD TVs – Big for Holiday 2016
2011 2012 2013 2014 2015 2016
Internet connected 51% 63% 61% 63% 78% 76%
Screen <60”
76% (79%) Screen >=60”
45% (35%)
4K Ultra HD
56% (59%)
HDR TV
53%
2016 % (2015 %)

32. Source: CTA, July 2016 Consumer Tech Sales and Forecasts
The Outlook for 4K Ultra HD LCD this Holiday Season
1. LCD TV unit volume is down 1% YTD
2. 4K UHD unit volume up 41% YTD
3. October 2015 and November 2015 were the first
months to see 4K UHD unit volume exceed 1M units
a month
4. CTA anticipates 4.6M to 5M units in 4Q2016

33. Holiday Tech Gifts: Audio
Audio
53%
(52%)
Portable Wireless
Speakers 18%
MP3 Player
16% (14%)
Soundbar
12%
Headphones (any kind)
40%
Bluetooth Speaker
25%
High Res Audio Player
8%
Headphone Feature
% of
Headphone
Buyers
Over or on the ear: less than $100 53%
Wireless 45%
Earbuds 35%
Sports or fitness 25%
Over or on the ear: $100 or more 24%
2016 % (2015 %)

34. Holiday Tech Gifts: Automotive & Gaming
Portable GPS
11% (12%)
Automotive
24% (22%)
Hands-Free Kit
12%
Rearview or Dashboard Camera
8%
2016 % (2015 %)
Mid-generation
Game Console
14%
Gaming
24%
(26%)
Portable Game
Console
10% (11%)
Game Console
17% (22%)

35. Smartwatch
17% (12%)
Holiday Tech Gifts: Wearables
Wearables
27%
Activity Tracker
15% (12%)
GPS Sports Watch
6%
2016 % (2015 %)
Consumer Purchase*
*Consumer Journey to Purchase: Health & Fitness (November 2015)
Purchased Most
Recently
Plan to Purchase
in Next 12 Months
Smartwatch 17% 35%
Dedicated Wearable Device 25% 27%
Fitness GPS 9% 21%
Heart Rate
Monitor or Strap
9%

36. Fitness Tracker Forecast
U.S. Unit Shipments (000s)
5% -2%
60%
25%
20%
15%
10%
Source: CTA, July 2016 Consumer Tech Sales and Forecasts

37. Smartwatch Forecast
U.S. Unit Shipments (000s)
15%
5% 2% 1% 0%
Source: CTA, July 2016 Consumer Tech Sales and Forecasts

38. Holiday Tech Gifts: Smart Home
Smart Thermostat
10% (6%) Smart
Home
24%Home Camera
8%
Digital Assistant Device
6%
Home Robotic Vacuum
5%
Smart Door Lock
5%
2016 % (2015 %)
Estimated U.S.
Installed Unit Base
2016
HH Purchase Intent
Smart Home Device
(excluding Smart Thermostat)
28.6 million 6%
Smart Thermostat 10 million 5%
Consumer Ownership*
*18th Annual Consumer Technology Ownership & Market Potential Study

39. Drone
9% (7%)
Holiday Tech Gifts: Emerging Tech
Emerging
Tech
30%
Connected or Digital Toys
11%
Smart or Connected
Sports Equipment
6%
3D Printer
6% (4%)
Pet-related Tech
6%
Smart Tracker Tags
5%
Connected Scale
2%
2016 % (2015 %)
VR Headset
10%

40. Video Game Accessory
18% (23%)
Holiday Tech Gifts: Accessories
Accessories
51% (58%)
Electronic Device Case
25%
Additional Memory Card
24% (25%)
Portable Battery Charger
23%
Computer Accessory
17% (20%)
Bluetooth Headset
17% (14%)
2016 % (2015 %)

41. #4 Online Defines Growth Profile

42. Planning to Buy More
Holiday Gifts Online
This Year
2016 = 28%
2015 = 27%
2014 = 26%

43. Online vs. In-Store Purchase Intent
% Very or Somewhat Likely to Purchase Tech from…
2011 2012 2013 2014 2015 2016
77% 77% 75% 77% 77% 74%
47% 46% 45% 54% 55% 57%
Physical Store
Online

44. % making an online consumer technology purchase?
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
50% to less than 55%
6%
11%
65% to less than 70%
3%
7%
Less than 50%
14%
22%
55% (remain the same)
7%
6%
56% to less than 60%
25%
27%
60% to less than 65%
12%
14%
70% or more
33%
17%
Last holiday season, about 55% of consumers said they were likely to make a technology
product purchase online. What percentage of consumers will likely make a consumer
technology purchase online this holiday season?

45. % making an in-store consumer technology purchase?
70% to less than 77%
7%
12%
78% to less than 85%
7%
10%
85% to less than 90%
7%
4%
Less than 60%
36%
39%
Strength Meter
How strongly
respondents felt about
their answers
% of People
Response Mix
Likelihood
% Probability
60% to less than 65%
10%
19%
65% to less than 70%
9%
12%
90% or more
11%
4%
77% (remain the same)
13%
7%
Last holiday season, 77% of US adults said they planned to purchase consumer
technology products at a physical store. What percentage of consumers will purchase
technology products from a physical store this coming holiday season?

46. 61% (+4% over 2015)
of consumers buying tech
will use a mobile device to
help them shop for tech.
24.4%
2016
Holiday Mobile Share
of Online Sales
Mobile Holiday Sales
$20.1B

47. Online and Mobile Driving Holiday Growth
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Total Online
Holiday Sales
$29B $28B $29B $34B $41B $48B $53.9B $62.5B $72.3B $84.2B
Total Online
Holiday Sales
(Y/Y Growth)
16% -3.4% 3.6% 17.2% 20.6% 17.1% 12.4% 15.9% 15.7% 16.4%
Mobile Holiday
Sales
$1B $3.7% $6.2B $7.3B $9.2B $13.9B $20.1B
Mobile as a %
of online
holiday sales
3% 9% 13% 13.4% 14.7% 19.2% 23.9%

48. #5 Online Deals/Shopping
Creates Isolation

49. Where Will Consumers Learn About Deals?
2015
2014
52% (2015)
63% (2015)
30% (2015)

50. Two-Thirds of U.S. Adults Start Shopping in Nov/Dec
Q: When do you typically start buying gifts?
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
September or Earlier 22% 18% 17% 16% 17% 15% 16% 14% 18% 15% 15%
October 21% 19% 16% 19% 17% 16% 11% 11% 13% 9% 10%
November 29% 31% 36% 33% 32% 35% 39% 38% 38% 38% 39%
December 23% 26% 26% 25% 27% 28% 25% 30% 23% 29% 27%
Don’t Buy Gifts 3% 4% 5% 7% 7% 5% 7% 7% 8% 8% 8%
Base: Random national sample of 1,005 U.S. adults

51. … And Most Gift Buying Occurs Later
When do you expect to buy gifts? 2014 2015 2016
October or earlier (Net) 16% 12% 13%
September or earlier 9% 5% 7%
October 7% 6% 6%
November or December (Net) 83% 87% 85%
November 49% 44% 44%
In November before Thanksgiving 16% 15% 12%
From Thanksgiving (incl. Black Friday) 33% 29% 32%
December 34% 42% 41%

52. 53%
50%
Consumers Ready to Pounce on Deals
41%
Make an
Unplanned
Purchase
Based on
a Deal
Shop
Specific
In-Store
Holiday Sales
Events
42%
2016:
2014:
52%
Shop
Specific
Online
Holiday Sales
Events
N/A
50%41%2015: 51%

53. Promo Programs Popular
IN-STORE RETAILER [NET]
64%
ONLINE RETAIL STORE [NET]
53%
83% plan to take part in a promo
program when shopping for tech products

54. Final Things to Consider

55. • Emphasis on Exclusivity
• Flash Sales and Season Long Deals
• Apps Drive More Mobile Purchasing
• Wish Lists: Shop, Scan, Build
• Price-Matching, Free Shipping, In-Store Pick-Up
Holiday 2016 Will Build On 2015 Retail Trends

56. Tech in the Bullseye: Target’s Top Teen Toys for 2016
• Jetson V6 Hoverboard (available Oct. 23; Target Exclusive)
• Nerf Rival Khaos in Red or Blue
• Pokémon Sun for Nintendo 3DS
• Pokémon Moon for Nintendo 3DS
• PlayStation 4 Console
• PlayStation VR Headset for PS4 (available Oct. 13)
• Madden 2017 for PS4
• Beats Solo 2 Headphones in Red, Yellow or Blue

57. The Growing Tension Between Opening and Closing

58. Holiday Shopping Rituals: Then and Now

61. 2016 Holiday Forecast
Series Projected 2016 Holiday Growth
Overall Retail Sales 3.8%
GAFO Retail Sales 0.5%
Electronics Retailers -2.9%
Online Sales 16.4%
Mobile Sales 45.2%
Consumer Spending on Tech 3.1%

62. Questions?
Shawn DuBravac, Ph.D., CFA
Chief Economist
shawnd@CTA.tech
@shawndubravac
Steve Koenig
Sr. Director, Market Research
skoenig@CTA.tech
@koenigsteve
CTA.tech/holiday