NPD: Consumers Trade PCs and Notebooks for Newer Models

Netbooks fuel multi-PC penetration in Canadian households

TORONTO - March 25, 2010 - Traditional notebook and desktop computers remain important considerations for Canadian consumers as the Canadian retail PC market shifts towards a “replacement” purchase cycle.

According to Understanding the Canadian PC Buyer, a recent study by leading market research company The NPD Group, aging computers that are considered unreliable and too slow are driving Canadians to replace their old notebook and desktop PCs with new ones.

“It is clear that the PC has become an important entertainment vehicle within Canadian households,” said Darrel Ryce, Director, The NPD Group. “What was once a product relegated to gaming, work and homework, the PC is now our social and entertainment epicenter, serving as the primary source for everything including music, photos, communication and learning. This being true, consumers are keen on having the most up-to-date technology.”

According to the study, more than half of overall PC purchases in 2009 – comprising netbooks, notebooks and desktops – were considered to be replacements for aging or outdated hardware. Replacement purchases typically skew towards the desktop PC category; however, recent data shows that 50 per cent of all notebooks purchased in 2009 were also replacements. This number is up from 38 per cent in 2008 and is anticipated to grow as notebooks increasingly become a household electronic staple.

Conversely, netbooks continue to be purchased primarily as extra or “additional” PCs, with 77 per cent of recent purchasers indicating their netbook is an extension of their existing PC inventory – a number that is consistent with 2008.

“Although I expect the replacement phase with notebook and desktop computers will exist in the Canadian PC market for the foreseeable future, netbooks will continue to rise in popularity and will exhibit sustained sales growth as Canadians continue the shift towards multi-PC households,” said Ryce.

Further data from the study shows that overall awareness of netbooks is on the rise, with 86 per cent of consumers claiming familiarity with the device, a 15 per cent increase over 2008. Additionally, three in 10 consumers indicate they will likely purchase a netbook in the near future.

Interestingly, there is a misconception of who the target market is for netbooks. Sixty-five per cent of Canadian consumers believe that netbooks are intended for university and college students, while 66 per cent of actual purchasers are aged 35 years or older. While overall awareness is on the rise, there is room for improvement in the positioning of these products to ensure that marketing efforts reach the intended audience and that consumers understand the benefits of these devices. According to NPD, misconceptions persist with more than half of all consumers (56 percent) expressing concern with the device’s capabilities, as well as its small screen (54 per cent) and absence of a CD / DVD drive (44 per cent).

About Understanding the Canadian PC Buyer
Understanding the PC Buyer provides comprehensive coverage of the purchase behaviour of desktop, notebook, and netbook buyers. It includes everything from initial purchase motivators to accessory attachment rates and total spends to date.

The full report provides a complete picture of the initial PC transaction and details the accessories purchased with the computer, those purchased afterwards and those the consumer intends to purchase in the near future.

It also explores overall reaction to netbook computers, including measures of awareness, perceived uniqueness, future purchase intent and purchase barriers, potential usage, and brand preferences.

Methodology
Utilizing NPD’s online Canadian panel, the study polled 2,588 consumers who reported a netbook, notebook or desktop computer purchase within the past nine months (July 2009 – January 2010).

Source: The NPD Group, Inc.