Q&A: Steve Koenig, Consumer Technology Association (CTA)
COVID-19 has undoubtedly turned the world upside down — including how consumers spend their money.
Steve Koenig, vice-president, research, Consumer Technology Association (CTA), recently sat down with Smart Homes to discuss all the ways that the COVID-19 pandemic has impacted consumer spending habits, and how it has accelerated change most notably in the smart fitness and automotive sector.
Watch our video with Steve here.
Q: How has the current global pandemic affected consumer spending habits?
Steve Koenig: First and foremost, we need to acknowledge the question of economic hardship in Canada and U.S. and so many other countries around the world people losing jobs or are basically on furlough. And this roller coaster of lockdown is very disruptive. We were expecting consumer spending to pull back, but the reverse happened. We’ve seen spending patterns shift pre-crisis, during crisis, and it’ll be interesting to see to what extent those spending patterns stick as we exit the crisis.
A lot of people are taking advantage of freed up discretionary income to upgrade a TV or buy smart technology like a smart doorbell, so they can see packages being delivered and if someone’s at the. Home improvement is another sector that was impacted, since people are spending more time at home and decide that it’s time to work on the house.
Those trends will come down as the economy opens up and people have more opportunities to spend dollars. Savings rate will come down and that’s one of those behaviours that will return to more of a normal pattern post-crisis.
Q: Has there been any growth in the smart fitness sector because of the pandemic?
SK: This is a sector that has really blossomed with gym closures. It will be interesting to watch that space and see if consumers stick with that modality, or if they return back to the gym or if people will still ride their Peloton.
Our research has shown that there is an elevated portion of awareness about personal well-being for very obvious reasons, but more with people staying at home. They have more time to pursue leisure activities, hobbies but also fitness. This is another reason why I think we’re seeing connected sports equipment and exercise equipment really pop up across more Canadian and U.S. households.
There are a lot of different connected technologies for fitness. You have the smartwatches and fitness trackers, which have also become very important in this crisis.
You put all this together, and we have a very digitized consumer, and it’s going to be interesting to see if people continue to work out at home or if they go back to the gym once it opens up again.
Q: People aren’t driving as often now — are you seeing any development in the smart automotive space?
SK: That’s been a dichotomy vehicle tech because on the one hand, there’s a lot going on and on the other hand, there’s not a lot going on. People aren’t driving, but they’re not using public transportation, either. People still get in their cars and go to the grocery store, or go for a shop or go for a drive. I would say at the salient of innovation when it comes to vehicle technology has to be electrification.
Self-driving vehicles are another area that is advancing quite rapidly, that’s really been the focus in vehicle tech. We think about Tesla Autopilot — you still have to sit there, but you can take your hands off the wheel and the vehicle pretty much drives itself.
But apart from self-driving vehicles and electrification, what we describe in the industry as advanced driver assistance features. Vehicles these days are festooned with sensors and it has everything to do with vehicle safety that the vehicle can really perceive the environment around itself, and that’s helpful for the driver for blind spot detection, and active lane keeping.
Five years ago, those features were really in the top tier of vehicles, and they were maybe available as an option for some mid-tier but now they’re really starting to filter down some of this has been related to regulatory requirements but most of it has just been competition, because consumers want that.
Who doesn’t want to have more safety features and be able to drive safer?