Retailers and manufacturers missing out on billions of dollars in laptop sales

Send to friend

On average 71% consumers across the UK and USA will upgrade to a new laptop within two years if retailers guarantee them a rebate of 50 per cent on the original purchase price of their current model, according to a new survey of 1,000 consumers split between the two countries.

This could help reset the decline of the PC market due to longer upgrade cycles and mobile-device cannibalisation as mentioned by Intel CEO Brian Krzanich at a recent investor conference.

The survey, conducted by polling firm Censuswide for risk-managed sales promotion expert Opia, reveals that 73% consumers in the US will upgrade if they are made such an offer, along with 69% in the UK.

"Guaranteed future value (GFV) offers have huge potential to help retailers and manufacturers on both sides of the Atlantic bust out of ever-longer refresh cycles in the laptop market," says Steve Gales, sales director at Opia.

"With more than 17 million units shipped in the US in the last quarter of 2015 and an estimated nine million UK consumers obtaining a laptop or notebook in the year, the revenue boost from customers upgrading more often could be colossal. The average US citizen, for example, spends $500 on a new laptop and if they do that every 2.5 years, instead of every five, retailers and manufacturers will see revenue rocket by more than $170bn in a five year period.

"Many consumers are hanging on to laptops for five years or more, putting up with ever-poorer performance because they fear having to spend on a new device. Although there are slight differences between the two countries, the survey shows that GFV can remove that fear, encouraging consumers to make new purchases more regularly."

The survey also reveals that 69% of consumers across the two countries view a new laptop as less expensive if the resale value is guaranteed to be 50% of what they paid for it, provided they upgrade within two years.

"Since most respondents (59%) in the two countries have previously taken up some form of promotional offer to buy a laptop, they are already open to suggestion if the offer is compelling. Retailers who don't act fast to implement closed loop upgrade promotions are subjecting themselves to ever-longer refresh cycles and lower revenues." says Gales.

The findings showed that in the US and UK, an average of 85% of consumers wait more than three years before buying a new laptop. In the US, 69% said they did not buy a new PC or laptop because new models were too expensive and are waiting for the right offers compared with 63% in the UK.

"These survey results demonstrate clearly how retailers and manufacturers failing to use risk-backed GFV promotional mechanisms are doing themselves out of a significant amount of business. One final example from the survey reveals 35% of US consumers and 30% of UK consumers said a 50% GFV offer could encourage them to buy a more expensive model when they come to upgrade", concludes Gales.

Comments (0)

Add a Comment

This thread has been closed from taking new comments.