June 10th, 2021- 18:00 PM
Consumers appetite for new devices dropped in 2020
Global Chip Shortage Dampened Global Supply
The new normal for cash strapped consumers in need of (essential) electronics
Consumers appetite for new devices dropped in 2020
According to the Kasi Insight COVID-19 tracker, demand for electronics (PC, TV, etc.) in Ghana was heavily impacted by the pandemic. Only 10% of Ghanaians were looking to purchase new electronics in 2020 but the appetite was fluctuating month over month. In March 2020, at the beginning of the lockdowns and economic slowdown, only 4% of consumers were looking to spend on a new device.
The percentage of those who indicated they were spending less on electronics fluctuated significantly over the year until it started to even out start in November 2020. By March 2021, the percentage of those who were spending less on electronics had dipped to 28%.
The respondents who indicated they were spending more also fluctuated significantly, until it started to stabilize on an upward trajectory starting in September 2020. From September 2020, those spending more on electronics went from 3% to 10% in March 2021.
Global Chip Shortage Dampened Global Supply
There is a global chip shortage due to drought, trade wars, and the pandemic, that has had an impact on electronic sales. Richer countries are more likely to have better access to reliable supply chains and consumers have more disposable income given the various government assistance programs during the pandemic than lower-income countries, making it harder for countries like Ghana to afford mostly imported electronics.
The decrease in electronic sales in Ghana in 2020 is not an isolated incident; globally, sales of small electronics such as phones and laptops decreased 1.4% in 2020, most notably in low- and middle-income countries. The pandemic has deepened the digital divide worldwide. In some countries, people adapted to the forced digitalization and work from home that stemmed from the pandemic. However, in lower-income countries, such as Ghana, the ability to earn a living, own, and benefit from electronics is not as possible. Electronic sales in Sub-Saharan Africa declined the most of any region in the world.
The new normal for cash strapped consumers in need of (essential) electronics
While spending on electronics in Ghana changed due to the pandemic, with the light at the end of the pandemic tunnel getting closer and closer and the economy reopening, Ghanaians might start to have more extra money that could go toward replacing their electronics or buying new ones. Furthermore, the global chip shortage is coming to an end and as such, electronics will become more affordable.
To attract consumers, electronic manufacturers should sell bundles of electronics where if you buy more, you save more. People would have been using their electronics more during the pandemic and putting off buying new ones, so they might be in need of more than just a new phone. Also, new electronics are expensive, but used electronics can be more affordable. Therefore, electronic stores should buy and sell used electronics, as well as run promotions where you can trade in used electronics for a discount on products. In this globalized, post-pandemic world, electronics are becoming more of a necessity and less of a luxury good.
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