Consumer Electronics Industry
Trends, characteristics, challenges and how to win in this industry
The Consumer Electronics Industry is an area in which the most advanced tools and methodologies for Design and Manufacturing give their best. The Consumer Electronics Industry is a time-sensitive market, that requires the ability to be fast and accurate at the same time. This is a market in which the consumer is King, but it is a demanding and unstable King, sometimes even capricious. What does it mean for an industry in which companies have to continuously invest money to bring their own new products to the market?
First of all, let’s give a definition of the Consumer Electronics Industry. A common definition of Consumer Electronics is “electronic equipment intended for everyday use, typically in private homes”. Unlike other industries - such as medical, aerospace, or industrial - whoever buys the products is a private consumer, not a company or a professional. A consolidated but not precise segmentation of this market distinguishes between “black goods” and “white goods”. Black goods are those typically housed in black or dark casings - such as computers, cameras, TV, radios - while white goods are meant for housekeeping tasks, such as washing machines and refrigerators.
The fact is that the boundaries of the Consumer Electronics Industry are very uncertain because electronics is invading any product area. There are many products that have only recently become electronic. Think about bikes, for example. Electronics-based products are disrupting entire markets! It is easy to imagine that electronics will be the core of every aspect of our lives.
What is considered a Consumer Electronics product?
With the help of different sources on the subject, we have tried to understand what is the most exhaustive segmentation for this market. Here it is below.
TV, Radio & Multimedia
- Televisions
- Radios
- Digital Cameras
- Speakers
- Headphones
Telephony
- Mobile Phones
- Landline Phones
Computing
- Laptops & Tablets
- Desktop PCs
- PC Monitors & Projectors
- Keyboards
- Printers & Copiers
- Storage Units
TV Peripheral Devices
- Smart Streaming Devices
- Smart Remotes
- Video Players
- Set-top-boxes
Smart Home
- Smart Security System
- Smart Security Camera
- Smart Video Doorbell
- Smart Smoke Alarm
- Smart Lighting
- Smart Plug
- Smart Speaker
- Smart Display
- Smart Thermostat
- Smart Lock
- Robot Vacuum Cleaner
- Mesh Wi-Fi Router
Home Appliances
- Major household appliance
- Small household appliance
E-mobility
- E-bikes
- Hoverboards
- Monorovers
- E-skateboards
- E-scooters
Other Devices
- Wereables
- Drones
- Toys
Consumer Electronics Industry: Trends and Characteristics
The Consumer Electronics market, despite the decline due to the Covid pandemic, is still very flourishing. According to Fortune Business Insights, it is projected to grow from USD 689.45 billion in 2020 to USD 989.37 billion in 2027 at a CAGR of 5.3% in the 2020-2027 period.
The Consumer Electronics Industry has its biggest players outside Europe, especially for large volumes of mass production of telephones, computers, TVs, etc. But in Europe there are a lot of OEMs pruducing niche products - like Mares for example - and a great ferment of start-ups. If we consider this industry from the point of view of those who design and manufacture products, we must take into account four main characteristics:
- It is very Time-sensitive, because sales of many products are driven by seasonality, trends or the success of advertising campaigns.
- It is sensitive to Aesthetics because in most cases electronics is embedded in cases whose shape and size are crucial for success.
- It requires a great frequency of Updating and Renewal, due to the volatility of consumer desires.
- There is a great deal of attention to Costs, because of the business-to-consumer direct sales model, that Amazon made dominant.
Challenges to face
The biggest technological challenge of these years, for designers and manufacturers of Consumer Electronics, comes from 5G. Compared to 4G, 5G networks will deliver 10x less latency, 50x more speed, and 1000x more capacity. This will open opportunities for new products, services, and entire markets. Billions of IoT devices coming online in the next years will require RF design capabilities that support ultra-fast 5G speeds: higher frequencies and wider bandwidths than ever. The #1 Challenge in PCB Design is the increasing complexity of a product (smaller form-factors, larger circuits, etc.). Furthermore, designing PCBs with RF requires design features and capabilities that are specific to RF.
At a general level, we can say that designers and manufacturers of Consumer Electronics products must face four main challenges:
- Deliver products on Time and shorten time-to-market as much as possible.
- Achieve a competitive Design for their products, compatibly with performances and cost requirements.
- Guarantee the production of many variations and customizations at acceptable costs.
- Reduce costs by avoiding inefficiencies along the entire product creation chain.
How to win in the Consumer Electronics Industry
Consumer Electronics products have very low margins and need to cut costs, but this is a natural consequence of adopting the Digital Twin as a model. It is possible to enable a complete Digital Twin of both products and processes. In this way, you can avoid prototypes and respins.
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