Technology Holiday Sales Hit $10.8 Billion

U.S. consumer technology retail sales fell less than one percent for the 2009 holiday season, according to a new report from The NPD Group.

The report found sales for the five-week holiday period reached $10.8 billion, a big improvement from the 6 percent decline during the 2008 holiday season.

The holiday season had its share of fluctuations. Overall revenue declined three out of the five weeks. While the second week of the season posted the largest revenue growth it only represented for 15 percent of overall holiday sales. The final week of the season also saw revenue growth and represented 22 percent of all sales, so the success of the final week was more relevant to the overall success of the season.

"The dynamics of the holiday season changed this year; the holiday season started before Black Friday as retailers ran Black Friday-like sales throughout November," said Stephen Baker, vice president of industry analysis at NPD.

"That move may have lessened the Black Friday hype for consumers, but the increase during the final week of the season is a sign that consumers either went back out or waited it out to get the best deal."

PCs and flash-based camcorders were popular this holiday leading the way in unit growth among large categories, but total sales numbers were dependent on the success of PCs and flat-panel TVs. Combined they accounted for 41 percent of the revenue over the five week holiday period, up from 39 percent in 2008 and 34 percent in 2007.

Despite the high revenue, flat-panel TVs registered a decline in dollars of 13 percent, in line with their performance during most of 2009. That decline pulled down the industry overall. MP3 players, for the third year in a row, were the largest unit volume category despite increased ASPs and declining unit volumes.

"Just cutting prices this year was not enough to guarantee successful sales results," said Baker. Flat-panel TVs had a disappointing holiday because there wasn't enough price-cutting on the right items, while notebook PCs and camcorders offered new form factors and price points that drove enormous increases in units and revenue despite falling prices."