Hot products for the holidays

Forget the Old Spice and yellow polka dot necktie, son. This holiday season, Dad's eyeing a flat-screen television.

While PCs and peripherals such as MP3 players have traditionally topped tech wish lists, this year retailers are expecting some changes, thanks to fast-falling prices on new TV technology. Flat-panel displays can now be had for $1,500 to $1,800, making them more competitive than ever with laptops and other computer gadgets.

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What's new:
With prices for televisions dropping, advanced sets including plasma-screen TVs and LCD TVs are expected to top wish lists this holiday season.

Bottom line:
The shopping season's upon us, and analysts are predicting strong sales and revenue growth for this year's popular electronics devices. Advanced televisions, digital cameras and MP3 players expected to garner triple-digital revenue and unit sales gains.

More stories on holiday sales

"If you've got $1,500, are you going to buy a new TV or a PC? This is the first year we're likely to see some (people) trading between those two categories," said Steve Baker, an analyst with NPD Group, which tracks retail sales of electronics. "I think we're starting to see the tail end of the great notebook revolution."

TVs and PCs, of course, won't be the only thing on consumers' minds when they set their alarms and venture out early the day after Thanksgiving. That frenzied Friday--also known as Black Friday by retailers in the United States--marks the start of the holiday shopping season.

But no matter when they start their sprees, consumers' appetites for music, television and video games--as well as for digital photos and PCs--are expected to propel sales of those products higher this year. Analysts and retailers expect notebooks, MP3 players and digital cameras, along with televisions, home networking equipment and even satellite radio receivers to be hot sellers, delivering higher revenue and unit sales numbers during the 2004 holiday season.

The Consumer Electronics Association expects U.S. holiday spending on electronics to increase 5 percent this year, putting the industry on track for annual sales of $108.8 billion.

Overall, holiday retail sales are expected to reach $219.9 billion this year, up 4.5 percent from 2003, a forecast by the National Retail Federation shows. The NRF figure includes general merchandise, clothing and furniture, as well as sporting goods, books, music and electronics. All told, sales in November and December represent nearly 23 percent of retail sales, the federation says.

Analysts say that electronics typically represent about 15 percent of the overall holiday take. That would put 2004 holiday season sales of electronics at retail at somewhere around $30 billion.

Gadgets are "becoming more compatible, more mobile, easier to use and more aesthetic, and every year the technology becomes more affordable," said Michael Linton, vice president of consumer and brand marketing at retailer Best Buy.

Best Buy, he said, is "cautiously optimistic" about the holiday season.

Baker predicted that advanced televisions, digital cameras and MP3 players could garner triple-digital revenue and unit sales gains this year, while satellite radio receivers could see high-double-digit increases in both as well.

Notebooks PCs are likely to see a boost of 20 percent to 30 percent in units and revenue this year. Desktops are likely to remain relatively flat, Baker added. Home networking gear could rise 10 percent to 20 percent in units and revenue as people attempt to begin sharing files between electronics devices in their homes.

Hewlett-Packard, which recently entered two of the hottest markets around, music players and TV sets, is counting on another trend--customization--to give it an edge. The company sells a "tattoo" kit for users who want to create and print designs for their iPods, and the company is selling as many of the kits as it can produce, said John Solomon, vice president for HP's Consumer Imaging and Printing Business Unit. A package of 10 tattoo sheets costs about $15.

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