Tag Archives: Spending

Technology Spending – Beyond Owned Gadgets

Technology Spending – Beyond Owned Gadgets – A MetaFacts TUPdate by Dan Ness, March 30, 2017

Tech spending – it’s mostly driven by living in the moment, through month-to-month subscriptions and on-demand content. Spending on tech devices, while substantial, is only a fraction of annual household spending. US household tech spending is also dominated a few big spenders.

During the full year of 2015, 90% of household technology spending was for services and 10% for devices. Total household tech spending averaged $7.9 thousand for the year. Most of this spending was concentrated among the top 25% of spenders. In 2015, the Top Quartile of adults spent $23.6 thousand on average for technology services and devices.

For these biggest tech spenders, services make up 93% of the technology spend. This is in contrast to the Bottom Quartile of spenders, whose spending is more equally balanced, with 63.6% going for services and 36.4% for devices.

After users have acquired their tech devices, bigger spenders add more technology services, and the services they use cost more than those chosen by lesser spenders. The Bottom Quartile of tech spenders are more likely to use fewer services and rely on fewer or unpaid connections, whether in libraries, cybercafés, or workplaces. Also, users in the Bottom Quartile are more likely to actively use Refurbished devices than bigger spenders.

Are younger adults the biggest spenders?

It can seem handy to contend that younger people spend more on technology than older people. However, age as a predictor of technology usage, adoption, or spending is a myth that’s only partly true. Age alone doesn’t signify tech spending, although it’s a key predictive factor.

Life Stage offers a more complete picture, as it combines age with employment status and presence of children. One Life Stage segment stands out as the biggest tech spenders – adults age 18-39 who are employed and have children. At $13,097 on average for total tech spending in 2015, their spending is effectively double similarly-aged adults, whether employed or not, and with or without children in the household.

Older adults (age 40+) which are employed and have children in the household are the second-biggest life stage group, with an average annual spend of $9,193.

The remaining Life Stage segments are similar with each other in average spending levels – whether younger or older, employed or not, and with or without children in the household.

Tech Spending – where the money goes

The majority of technology spending is in three categories – Internet services & equipment, Mobile phones and service, and consumer electronics and content. Just over one-fourth (26%) of household technology spending went to Internet Services & Equipment, the routers and modems to connect PCs and IoT devices to the Internet, as well as the various fees for ISPs and Internet services, such as cloud-based file storage and sharing.

Mobile phones make up nearly a quarter of spending (24%), including Smartphones and Basic cell phones, and the cell phone service, data plan, apps, games, and related fees.

The third-largest household tech spending category is Consumer Electronics, spanning TVs to game consoles and TV/movie subscription, rental services, and games.

PCs and Printers each represent 9% of household tech spending. PC spending is primarily for the hardware, as PC-related services are minimal. The reverse is true for Printers, where most of the spending is on consumables such as ink and paper.

The technology spending mix for big spenders versus low spenders

Spending on Consumer Electronics are a higher share of spending among the biggest tech spenders than lesser spenders. The top one-fourth of Connected Adults who spend the most, spend 24% of their tech dollars on Consumer Electronics products and services. In stark contrast, the bottom quartile of spenders spend only 7%.

Instead, the Bottom Quartile have more of their dollars going to Mobile Phone devices and services – 34% – versus only 22% among the Top Quartile.

The share of tech spending for Internet services and devices is nearly the same rate regardless of quartile, ranging between 25% and 27%.

For lower-income and lesser-spending households, Smartphones and Basic cell phones are almost a lifeline, often acting as the single or primary way to connect to the Internet.

Streaming and spending

A higher share of big spenders use paid streaming services than by lesser spenders. This is especially true for video streaming, which is used by slightly over a quarter (26%) of the Bottom Quartile, versus 44% of the Top Quartile.

Paid music streaming is only slightly higher among the Top Quartile (80%) than among the Bottom Quartile (74%).

Interestingly, users of paid streaming music services also actively use free streaming music services. Although streaming music providers Pandora, Spotify, and others work hard to have collections which are large, popular, and current, many consumers have a healthier appetite and use more than one service.

Looking Ahead

Technology spending has continued to increase as a share of total household discretionary spending. We expect spending growth to continue, even among the Bottom Quartile of spenders.

Since Internet service is such a large part of household tech spending for all, we expect any changes in these services to have a major impact on total spending.

The debate continues whether Internet access is a privilege or basic human need. Organizations from retailers and hospitals to schools and governments continue to move more of their operations online to better and more cost-effectively support their customers and constituents. This will strengthen market demand, as ordinary citizens will increasingly rely on their technology devices and services for everyday shopping, education, and government services.

At the same time, the US Federal Government has recently announced policy shifts away from subsidizing further broadband adoption to more of the populace. Whether states or regional governments will move to make up what’s being reduced remains to be seen. While we expect demand and reliance on connectivity to increase, we’ll also see continued creative approaches by those most affected – the Bottom Quartile.

While hardwired connections support the broadest range of users, wireless bandwidth and coverage continues to increase for many. Capability continues to lag user demand, as data-hungry users broaden their Internet-intensive activities and collection of actively-used devices.

Even the Top Quartile of spenders rely on their high-speed connections and cell signal. Ask any accomplished yogi to momentarily forgo using their Smartphone or (gasp) Wi-Fi and you’ll likely get a demonstration of their skills in managing their breath – and temper.

About this TUPdate

This TUPdate includes a complimentary brief summary of recent MetaFacts TUP (Technology User Profile) research results. These results are based on the most-recent results of the MetaFacts Technology User Profile 2016 survey, its 34th wave, with 7,334 respondents (US). For more information about MetaFacts and subscribing to TUP, please contact MetaFacts.


Current TUP subscribers can tap into any of the following TUP information used for this analysis or for even deeper analysis.
This TUPdate was based on results in the TUP Chapter – Tech Spending.


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Filed under Consumer research, Desktops, Households, Market Research, Market Sizing, Notebooks, Smartphones, TUP 2016, TUPdate

Who spends most on tech – older or younger adults? (MetaFAQs)

In many tech circles, there’s a strong attention on the youngest adults. How true is it that younger adults spend more than older adults?

Our research shows that when it comes to household tech spending, age matters, although it’s not that simple.

First of all, while the youngest adults often are the most enthusiastic about technology, they don’t have the same financial means of older adults.

The majority of household tech spending is among adults age 30-39.metafacts-mqxxxx-tech-spending-x-age-2016-11-01_07-51-20

More importantly, when adjusting for employment status – including the self-employed – the analysis is clearer. Employed adults out-spend those not employed from ages 25 to 54.

There’s a “late life kicker” that’s important to note. After age 60, household tech spending is stronger among those not employed than those employed. Also, although employment rates decline with age, total household tech spending is stronger among the age 65-69 group than the age 55-59.

This is based on our most recent research among 7,336 US adults as part of the Technology User Profile (TUP) 2016 survey.

This MetaFAQs research result addresses one of the many questions profiling active technology users. Specifically for this analysis, we looked at household tech spending along 15 categories of technology devices and services, from PCs, printers, and routers to Internet and mobile phone service.

Many other related answers are part of the full TUP service, available to paid subscribers. The TUP chapters with the most information about activities is the TUP 2016 User Profile Chapter, which includes sections more deeply analyzing by age and life stage.

These MetaFAQs are brought to you by MetaFacts, based on research results from their most-recent wave of Technology User Profile (TUP).

For more information about MetaFacts and subscribing to TUP, please contact MetaFacts.

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Filed under Consumer research, Demographics & Econographics, Households, Market Research, MetaFAQs, TUP 2016

Buying Behavior – solid market research from MetaFacts Technology User Profile

Extensive information about buying behavior is available in TUP – Technology User Profile.

The retail adage: “buyers vote with their feet” is a reflection of old thinking, just as “new buyers vote with their mouse clicks” shows the same partial thinking. Up-to-date technology marketers and researchers know well how important it is to understand the full view of buyers. Consumers are influenced by many screens – and only having one view misses out on the true picture. After all, buyers have many choices and demonstrate time and time again their willingness to change.

Consumers have expanded, contracted, sidestepped, and evolved their buying behaviors. Retail has defied the proclamations of its doom and yet is not what it used to be. As tech buyers continue to change their tastes and preferences, they have tried many different types of channels. The changes are far from over.

Below are a few examples of questions addressed in TUP related to buying behavior. The full TUP service enables drilling down beyond the answers to these questions to identify which other technologies, services and behaviors are disruptive and to profile which market segments are and aren’t adopting. TUP is much more than a one-dimensional market view or opinion piece.

  • Who are the biggest tech spenders? Which segments spend the most and least for devices? How does spending for tech services differ?
  • Who are the people who shop for technology products on the web, but purchase at a local retail outlet?
  • How do consumer attitudes about purchasing technology differ between Apple, Hewlett Packard and Dell customers?
  • To what extent do tech shoppers focus on certain channels for certain products versus staying with a smaller number of outlets?
  • Who is printing coupons?
  • Which tech buyers focus more on retail than shopping online and vice versa?
  • Online shoppers – are they everyone, or unique?
  • Are Apple’s retail shoppers already the Apple-faithful or is Apple drawing in the unconverted? Who are these shoppers?
  • Where do people buy their printer supplies?
  • Who is buying the highest-end PCs? Are there brand differences? What else do users buy and what else do they use?
  • How do online shopping activities differ between Hewlett Packard, Apple and Dell customers?
  • Where are printer users buying their printer supplies? Are these the same channels as where they buy their printers?
  • How many screens do people view? Which market segments view more screens than other segments?
  • How strong is name-brand dominance?
  • What is the frequency of printer consumables purchase?
  • Is the smartphone killing PC shopping?
  • What other items (printers, software, monitors/displays, extended service plan, etc.) do people typically buy with their PC purchase?
  • How prominent is Home PC renting versus outright purchase?
  • What channels do people use for buying PCs? How about printers and printer supplies? How do Best Buy customers compare to Office Depot of Staples shoppers?
  • What’s typically bundled with a PC?
  • Who spends the most hours online?
  • Who is using mobile payments?
  • How are Facebook users different from users of other Social Networks? Beside demographics, what else distinguishes these from each other?
  • Beyond paper or plastic: which types of ink & toner are printer users buying? New or refilled? Original or competitor?
  • What about the anti-social – those that aren’t in an online social network? Who are they? In what other ways are they actively communicating and having fun? How does their spending profile compare?
  • What is the status of mobile phone transition, from basic feature phones to smartphones and non-users?
  • What do users sync or “store” in the cloud? How do users share images – social networking sites or photo-specific sites? Which users are the most active?
  • Entertainment primacy – what is the center of the user’s home entertainment world? Is it one device or many? Which devices and services, and among which segments?
  • Used/Refurbished PCs – who buys them?
  • How many seniors are online? How is their behavior different than younger online users?
  • How much have PC users integrated PCs into their personal lives?
  • Which combination of tech devices is the most popular today? How large is each segment? Who are in each segment? Which direction are they headed with their buying plans?
  • How are users communicating, given all their communication options?
  • Which social networks show the most growth-oriented activity? Which segments show signs of losing interest or withdrawing?
  • Do mobile PC users print differently than desktop users? Do the more-mobile use more or fewer printers? Do the more-mobile print different content?
  • Which segments have recently paid for a downloaded mobile phone app?
  • What is the impact on privacy concerns on use of social networking?
  • How does the life and lifespan of a PC vary by form factor? Does it vary by brand? By user segment? By tech spending behavior?

If solid answers to any of these example questions would help your work in creating the future, please contact MetaFacts.

MetaFacts, Inc. helps technology marketers find and measure their best and future customers.

Current subscribers of Technology User Profile may obtain this information directly from MetaFacts, as well as additional customized drilling down into the full datasets.

For more information on the results delivered in TUP and about how to subscribe, please contact MetaFacts.

The above questions are answered with the TUP 2012 edition, and most are also answered in the TUP 2011 edition for ready trend comparison.

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Filed under Consumer research, Market Research, MetaFAQs, Statistics, Tech Market, Trends, TUP 2011, TUP 2012