Who's Buying Information and Consumer Electronics

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THE WHO’S BUYING SERIES BY THE NEW STRATEGIST EDITORS

Information and Consumer Electronics

Wh

New Strategist Publications, Inc. P.O. Box 242, Ithaca, New York 14851 800/848-0842; 607/273-0913 www.newstrategist.com

Copyright 2008. NEW STRATEGIST PUBLICATIONS, INC.

All rights reserved. No part of this book may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, microfilming, recording, or otherwise without written permission from the Publisher.

ISBN 978-1-935114-13-0 ISBN 1-935114-13-1 Printed in the United States of America

Contents About the Data in Who’s Buying Information and Consumer Electronics ...............................................................................5 1.

Percent Reporting Expenditure and Amount Spent, Average Quarter, 2006 .............................9

Household Spending Trends, 2000 to 2006 ................................................................................................................10 2.

Household Spending Trends, 2000 to 2006 .................................................................................... 11

Household Spending on Information and Consumer Electronics, 2006 ..............................................................................13 3.

Information and Consumer Electronics Spending, 2000 to 2006 ................................................15

Household Spending on Information and Consumer Electronics by Demographic Characteristic, 2006 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31.

Information and Consumer Electronics: Average Spending by Age, 2006 ...............................16 Information and Consumer Electronics: Indexed Spending by Age, 2006 ...............................17 Information and Consumer Electronics: Total Spending by Age, 2006 .....................................18 Information and Consumer Electronics: Market Shares by Age, 2006 ......................................19 Information and Consumer Electronics: Average Spending by Income, 2006 .........................20 Information and Consumer Electronics: Indexed Spending by Income, 2006 .........................21 Information and Consumer Electronics: Total Spending by Income, 2006 ...............................22 Information and Consumer Electronics: Market Shares by Income, 2006 ................................23 Information and Consumer Electronics: Average Spending by High-Income Consumer Units, 2006 .........................................................................................24 Information and Consumer Electronics: Indexed Spending by High-Income Consumer Units, 2006 .........................................................................................25 Information and Consumer Electronics: Total Spending by High-Income Consumer Units, 2006 .........................................................................................26 Information and Consumer Electronics: Market Shares by High-Income Consumer Units, 2006 .........................................................................................27 Information and Consumer Electronics: Average Spending by Household Type, 2006 .........28 Information and Consumer Electronics: Indexed Spending by Household Type, 2006 .........29 Information and Consumer Electronics: Total Spending by Household Type, 2006 ...............30 Information and Consumer Electronics: Market Shares by Household Type, 2006 ................31 Information and Consumer Electronics: Average Spending by Race and Hispanic Origin, 2006 .................................................................................................32 Information and Consumer Electronics: Indexed Spending by Race and Hispanic Origin, 2006 .................................................................................................33 Information and Consumer Electronics: Total Spending by Race and Hispanic Origin, 2006 ......................................................................................................34 Information and Consumer Electronics: Market Shares by Race and Hispanic Origin, 2006 ......................................................................................................35 Information and Consumer Electronics: Average Spending by Region, 2006 ..........................36 Information and Consumer Electronics: Indexed Spending by Region, 2006 ..........................37 Information and Consumer Electronics: Total Spending by Region, 2006 ................................38 Information and Consumer Electronics: Market Shares by Region, 2006 .................................39 Information and Consumer Electronics: Average Spending by Education, 2006 ....................40 Information and Consumer Electronics: Indexed Spending by Education, 2006 ....................41 Information and Consumer Electronics: Total Spending by Education, 2006 ..........................42 Information and Consumer Electronics: Market Shares by Education, 2006 ...........................43 WHO’S BUYING INFORMATION AND CONSUMER ELECTRONICS 3

Household Spending on Information and Consumer Electronics by Product Category, 2006 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58.

Books ..................................................................................................................................................44 Cable Service and Community Antenna........................................................................................46 Compast Disks, Audio Tapes, Records...........................................................................................48 Cellular Phone Service ......................................................................................................................50 Computers and Computer Hardware for Nonbusiness Use ......................................................52 Computer Information Services ......................................................................................................54 Computer Software and Accessories for Nonbusiness Use ........................................................56 Film ......................................................................................................................................................58 Global Positioning System Services ................................................................................................60 Internet Services Away from Home ................................................................................................62 Magazines and Newspapers, Nonsubscription ............................................................................64 Magazines and Newspapers, Subscription ..................................................................................66 Personal Digital Assistants ...............................................................................................................68 Personal Digital Audio Players .......................................................................................................70 Phone Cards .......................................................................................................................................72 Photographic Equipment .................................................................................................................74 Photo Processing................................................................................................................................76 Residential Telephone Service and Pay Phones ............................................................................78 Sound Components, Equipment, and Accessories .......................................................................80 Streaming and Downloading Audio ..............................................................................................82 Streaming and Downloading Video ...............................................................................................84 Telephones, Answering Machines, and Accessories ....................................................................86 Television Sets ....................................................................................................................................88 Video Cassette Recorders and Video Disc Players .......................................................................90 Video Cassettes, Tapes, and Discs ...................................................................................................92 Video Game Hardware and Software.............................................................................................94 Video Tape, Disc, and Film Rental ..................................................................................................96

Appendix: Spending by Product and Service, Ranked by Amount Spent, 2006......................................................................98 Glossary ..........................................................................................................................................................105

4 WHO’S BUYING INFORMATION AND CONSUMER ELECTRONICS

About the Data in Who’s Buying Information and Consumer Electronics Introduction The spending data in Who’s Buying Information and Consumer Electronics are based on the Bureau of Labor Statistics’ Consumer Expenditure Survey, an ongoing, nationwide survey of household spending. The Consumer Expenditure Survey is a complete accounting of household expenditures. It includes everything from big-ticket items, such as homes and cars, to small purchases like laundry detergent and videos. The survey does not include expenditures by government, business, or institutions. The lag time between data collection and dissemination is about two years. The data in this report are from the 2006 Consumer Expenditure Survey, unless otherwise noted. To produce this report, New Strategist Publications analyzed the Consumer Expenditure Survey’s average household spending data in a variety of ways, calculating household spending indexes, aggregate (or total) household spending, and market shares. Spending data by age, household income, household type, race, Hispanic origin, region of residence, and education are shown in this report. These analyses are presented in two formats—for all product categories by demographic characteristic and for all demographic characteristics by product category.

Definition of consumer unit The Consumer Expenditure Survey uses the consumer unit rather than the household as the sampling unit. The term “household” is used interchangeably with the term “consumer unit” in this report for convenience, although they are not exactly the same. Some households contain more than one consumer unit. The Bureau of Labor Statistics defines consumer unit as (1) members of a household who are related by blood, marriage, adoption, or other legal arrangements; (2) a person living alone or sharing a household with others or living as a roomer in a private home or lodging house or in permanent living quarters in a hotel or motel, but who is financially independent; or (3) two or more persons living together who pool their income to make joint expenditure decisions. The bureau defines financial independence in terms of “the three major expense categories: housing, food, and other living expenses. To be considered financially independent, at least two of the three major expense categories have to be provided by the respondent.” The Census Bureau uses the household as its sampling unit in the decennial census and in the monthly Current Population Survey. The Census Bureau’s household “consists of all persons who occupy a housing unit. A house, an apartment or other group of rooms, or a single room is regarded as a housing unit when it is occupied or intended for occupancy as separate living quarters; that is, when the occupants do not live and eat with any other persons in the structure and there is direct access from the outside or through a common hall.” The definition goes on to specify that “a household includes the related family members and all the unrelated persons, if any, such as lodgers, foster children, wards, or employees who share the housing unit. A person living alone in a housing unit or a group of unrelated persons sharing a housing unit as partners is also counted as a household. The count of households excludes group quarters.” Because there can be more than one consumer unit in a household, consumer units outnumber households by several million. Young adults under age 25 head most of the additional consumer units.

WHO’S BUYING INFORMATION AND CONSUMER ELECTRONICS 5

How to use the tables in this report The starting point for all calculations are the unpublished, detailed average household spending data collected by the Consumer Expenditure Survey. These numbers are shown on the report’s average spending tables and on each of the product-specific tables. New Strategist’s editors calculated the other figures in the report based on the average figures. The indexed spending tables and the indexed spending column (Best Customers) on the product-specific tables reveal whether spending by households in a given segment is above or below the average for all households and by how much. The total (or aggregate) spending tables show the overall size of the market. The market share tables and market share column (Biggest Customers) on the product-specific tables reveal how much spending each household segment controls. These analyses are described in detail below. • Average Spending The average spending figures show the average annual spending of households on information and consumer electronics in 2006. The Consumer Expenditure Survey produces average spending data for all households in a segment, e.g., all households with a householder aged 25 to 34, not just for those who purchased the item. When examining spending data, it is important to remember that by including both purchasers and nonpurchasers in the calculation, the average is less than the amount spent on the item by buyers. (See Table 1 for the percentage of households that spent on information and consumer electronics in 2006 and how much the purchasers spent.) Because average spending figures include both buyers and nonbuyers, they reveal spending patterns by demographic characteristic. By knowing who is most likely to spend on an item, marketers can target their advertising and promotions more efficiently, and businesses can determine the market potential of a product or service in a city or neighborhood. By multiplying the average amount households spend on computer information services by the number of households in an area, for example, an Internet service provider can estimate the potential size of the local market for online services. • Indexed Spending (Best Customers) The indexed spending figures compare the spending of each household segment with that of the average household. To compute the indexes, New Strategist divides the average amount each household segment spends on an item by average household spending and multiplies the resulting figure by 100. An index of 100 is the average for all households. An index of 125 means the spending of a household segment is 25 percent above average (100 plus 25). An index of 75 indicates spending that is 25 percent below the average for all households (100 minus 25). Indexed spending figures identify the best customers for a product or service. Households with an index of 178 for cell phone service, for example, are a strong market for this product. Those with an index below 100 are a weak market. Spending indexes can reveal hidden markets—household segments with a high propensity to buy a particular product or service but which are overshadowed by household segments that account for a larger share of the market. Householders aged 45 to 54, for example, account for 22 percent of the newspaper and magazine subscription market—a larger share than the 16 percent controlled by householders aged 65 to 74. But a look at the indexed spending figures reveals that, in fact, the older householders are the better customers. Householder aged 65 to 74 spend 64 percent more than the average household on newspapers and magazine subscriptions, while those aged 45 to 54 spend only 8 percent more than average. Newspaper and magazine publishers can use this information to target their best customers. Note that because of sampling errors, small differences in index values may be insignificant. But the broader patterns revealed by indexes can guide marketers to the best customers.


• Total (Aggregate) Spending To produce the total (aggregate) spending figures, New Strategist multiplies average spending by the number of households in a segment. The result is the dollar size of the total household market and of each market segment. All totals are shown in thousands of dollars. To convert the numbers in the total spending tables to dollars, you must append “000” to the number. For example, households headed by people aged 45 to 54 spent more than $15 billion ($15,491,801,000) on cell phone service in 2006. When comparing the total spending figures in this report with total spending estimates from the Bureau of Economic Analysis, other government agencies, or trade associations, keep in mind that the Consumer Expenditure Survey includes only household spending, not spending by businesses or institutions. Sales data also will differ from household spending totals because sales figures for consumer products include the value of goods sold to industries, government, and foreign markets, which may be a significant proportion of sales. • Market Shares (Biggest Customers) New Strategist produces market share figures by converting total (aggregate) spending data into percentages. To calculate the percentage of total spending on an item that is controlled by each demographic segment—i.e., its market share—each segment’s total spending on an item is divided by aggregate household spending on the item. Market shares reveal the biggest customers—the demographic segments that account for the largest share of spending on a particular product or service. In 2006, for example, households headed by people aged 55 or older accounted for 55 percent of spending on newspaper and magazine subscriptions. By targeting only these householders, newspaper and magazine publishers could reach the majority of their customers. There is a danger here, however. By single-mindedly targeting the biggest customers, businesses cannot nurture potential growth markets. With competition for customers more heated than ever, targeting potential markets is increasingly important to business survival. • Product Specific Tables The product-specific tables reveal at a glance the demographic characteristics of spending by individual product category. These tables show average spending, indexed spending (Best Customers), and market shares (Biggest Customers) by age, income, household type, race and Hispanic origin, region of residence, and education. If you want to see the spending pattern for an individual product at a glance, these are the tables for you.

History and methodology of the Consumer Expenditure Survey The Consumer Expenditure Survey is an ongoing study of the day-to-day spending of American households. In taking the survey, government interviewers collect spending data on products and services as well as the amount and sources of household income, changes in saving and debt, and demographic and economic characteristics of household members. The Bureau of the Census collects data for the Consumer Expenditure Survey under contract with the Bureau of Labor Statistics, which is responsible for analysis and release of the survey data. Since the late 19th century, the federal government has conducted expenditure surveys about every 10 years. Although the results have been used for a variety of purposes, their primary application is to track consumer prices. In 1980, the Consumer Expenditure Survey became continuous with annual release of data (with a lag time of about two years between data collection and release). The survey is used to update prices for the market basket of products and services used in calculating the Consumer Price Index. The Consumer Expenditure Survey consists of two separate surveys: an interview survey and a diary survey. In the interview portion of the survey, respondents are asked each quarter for five consecutive quarters to report their expenditures for the previous three months. The purchase of big-ticket items


such as houses, cars, and major appliances, or recurring expenses such as insurance premiums, utility payments, and rent are recorded by the interview survey. The interview component covers about 95 percent of all expenditures. Expenditures on small, frequently purchased items are recorded during a two-week period by the diary survey. These detailed records include expenses for food and beverages purchased in grocery stores and at restaurants, as well as other items such as tobacco, housekeeping supplies, nonprescription drugs, and personal care products and services. The diary survey is intended to capture expenditures respondents are likely to forget or recall incorrectly over longer periods of time. Two separate, nationally representative samples are used for the interview and diary surveys. For the interview survey, about 7,500 consumer units are interviewed on a rotating panel basis each quarter for five consecutive quarters. Another 7,500 consumer units keep weekly diaries of spending for two consecutive weeks. Data collection is carried out in 105 areas of the country. The Bureau of Labor Statistics reviews, audits, and cleanses the data, then weights them to reflect the number and characteristics of all U.S. consumer units. Like any sample survey, the Consumer Expenditure Survey is subject to two major types of error. Nonsampling error occurs when respondents misinterpret questions or interviewers are inconsistent in the way they ask questions or record answers. Respondents may forget items, recall expenses incorrectly, or deliberately give wrong answers. A respondent may remember how much he or she spent at the grocery store but forget the items picked up at a local convenience store. Nonsampling error can also be caused by mistakes during the various stages of data processing and refinement. Sampling error occurs when a sample does not accurately represent the population it is supposed to represent. This kind of error is present in every sample-based survey and is minimized by using a proper sampling procedure. Standard error tables documenting the extent of sampling error in the Consumer Expenditure Survey are available from the Bureau of Labor Statistics at http://www.bls.gov/cex/ csxstnderror.htm. Although the Consumer Expenditure Survey is the best source of information about the spending behavior of American households, it should be treated with caution because of the above problems.

For more information To find out more about the Consumer Expenditure Survey, contact the specialists at the Bureau of Labor Statistics at (202) 691-6900, or visit the Consumer Expenditure Survey home page at http://www.bls .gov/cex/. The web site includes news releases, technical documentation, and current and historical summary-level data. The detailed average spending data shown in this report are available from the Bureau of Labor Statistics only by special request. For a comprehensive look at detailed household spending data for all products and services, see the 13th edition of Household Spending: Who Spends How Much on What. New Strategist’s books are available in hardcopy or as downloads by visiting http://www.newstrategist.com or by calling 1-800-848-0842.


Table 1. Percent reporting expenditure and amount spent,

average quarter, 2006 (percent of consumer units reporting expenditure and amount spent by purchasers during an average quarter, 2006) average quarter percent reporting expenditure

Books (not purchased through book clubs) Cable service and community antenna Cellular phone service Compact discs, records, and audio tapes Computer information services Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Radios Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone and pay phones Sound components and component systems Sound equipment accessories Streaming and downloading audio Streaming and downloading video Tape recorders and players Telephone answering devices Telephones and accessories Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

19.2% 73.0 52.8 16.8 49.7 4.5 5.1 7.1 0.4 0.7 22.5 17.1 0.3 1.8 8.1 11.6 2.7 1.0 22.0 0.6 93.8 1.0 1.0 2.3 0.6 0.2 0.3 5.2 3.9 2.4 17.2 5.5

amount spent by purchasers

$63.86 184.73 247.86 50.58 88.82 120.29 693.53 22.60 102.56 63.08 54.19 21.32 302.94 244.52 65.23 38.44 298.17 92.00 35.78 255.95 289.80 338.12 187.50 39.52 40.87 75.00 55.65 101.30 831.57 165.84 59.74 156.14

Note: Expenditures shown are total net outlays at the time of purchase, whether or not the item was financed. Source: Calculations by New Strategist based on the 2006 Consumer Expenditure Survey


Household Spending Trends, 2000 to 2006 Between 2000 and 2006, spending by the average household rose by 8.7 percent, after adjusting for inflation. In 2006, the average household spent $48,398, according to the Bureau of Labor Statistics’ Consumer Expenditure Survey, almost $4,000 more than the inflation-adjusted $44,541 of 2000. Spending surged on a number of items between 2000 and 2006. Perhaps not surprisingly, the biggest gainer was gasoline. The average household spent 47 percent more on gasoline in 2006 than in 2000, after adjusting for inflation, and 42 percent more on natural gas. It spent $1,465 on out-of-pocket health insurance costs, 27 percent more than in 2000. Spending on property taxes climbed 24 percent, and spending on education rose 20 percent. Households boosted their spending on a handful of discretionary categories, but by smaller margins. Spending on entertainment grew 9 percent, primarily due to a 24 percent increase in spending on audio and visual equipment and services. Behind this gain is the growing popularity of high-priced high-definition television sets. Spending on food away from home (primarily restaurant meals) climbed 8 percent. The average household cut spending on a number of products and services between 2000 and 2006. Apparel spending fell 14 percent, after adjusting for inflation, driven in part by a 24 percent decline on footwear spending. Spending on vehicle purchases fell 15 percent partially fueled by a 24 percent spending decline on used cars and trucks. The average household’s spending on reading material dropped 32 percent between 2000 and 2006. Personal taxes declined 33 percent on average, from an inflation-adjusted $3,649 in 2000 to $2,432 in 2006. At the time the data shown in this report were collected, average household spending had recovered from the recession of 2001 and the sluggish economy that followed. But the effects of the 2008 slowdown on consumer spending had yet to be felt.

Households are spending less on some items, more on others 60

(percent change in spending by the average household on selected products and services, 2000 to 2006; in 2006 dollars)

47%

40

40%

27%

20

20%

20%

9%

0

0%

–3%

-20 -40

–14%

–20%

–32% readinga material

apparel b

food c at home


entertainment d

education e

health insurance f

gasoline g

Table 2. Household spending trends, 2000 to 2006 (average annual spending of total consumer units, 2000 and 2006; percent change, 2000–06; in 2006 dollars) percent change 2006 2000 2000–06 Number of consumer units (in 000s) Average before-tax income of consumer units Average annual spending of consumer units

118,843 $60,533 48,398

109,367 $52,272 44,541

FOOD Food at home Cereals and bakery products Cereals and cereal products Bakery products Meats, poultry, fish, and eggs Beef Pork Other meats Poultry Fish and seafood Eggs Dairy products Fresh milk and cream Other dairy products Fruits and vegetables Fresh fruits Fresh vegetables Processed fruits Processed vegetables Other food at home Sugar and other sweets Fats and oils Miscellaneous foods Nonalcoholic beverages Food prepared by consumer unit on trips

6,111 3,417 446 143 304 797 236 157 105 141 122 37 368 140 228 592 195 193 109 95 1,212 125 86 627 332 43

6,039 3,537 530 183 348 931 279 196 118 170 129 40 380 153 226 610 191 186 135 98 1,085 137 97 512 293 47

Food away from home

2,694

2,502

7.7

497

436

14.1

16,366 9,673 6,516 3,753 1,649 1,115 2,590 567

14,422 8,329 5,388 3,090 1,333 966 2,381 560

13.5 16.1 20.9 21.5 23.7 15.4 8.8 1.3

3,397 509 1,266 138 1,087 397

2,914 359 1,067 114 1,027 347

16.6 41.6 18.7 21.5 5.9 14.6

Household services Personal services Other household services

948 393 555

801 382 419

18.4 3.0 32.4

Housekeeping supplies Laundry and cleaning supplies Other household products Postage and stationery

640 151 330 159

564 153 265 148

13.4 –1.5 24.7 7.8

1,708 154 463

1,813 124 458

–5.8 24.1 1.1

ALCOHOLIC BEVERAGES HOUSING Shelter Owned dwellings Mortgage interest and charges Property taxes Maintenance, repair, insurance, other expenses Rented dwellings Other lodging Utilities, fuels, and public services Natural gas Electricity Fuel oil and other fuels Telephone services Water and other public services

Household furnishings and equipment Household textiles Furniture

8.7% 15.8 8.7 1.2 –3.4 –15.9 –21.7 –12.6 –14.4 –15.3 –19.7 –11.2 –16.9 –5.3 –7.0 –3.3 –8.7 0.9 –2.9 2.2 3.7 –19.0 –3.4 11.7 –8.7 –11.5 22.6 13.4 –8.2


Floor coverings Major appliances Small appliances and miscellaneous housewares Miscellaneous household equipment APPAREL AND RELATED SERVICES Men and boys Men, aged 16 or older Boys, aged 2 to 15 Women and girls Women, aged 16 or older Girls, aged 2 to 15 Children under age 2 Footwear Other apparel products and services

percent change 2000–06

2006

2000

$48 241 109 693

$52 221 102 856

1,874 444 353 91

2,173 515 403 112

–13.8 –13.8 –12.3 –19.0

751 629 122

849 711 138

–11.5 –11.5 –11.7

–6.8% 8.9 7.0 –19.0

96

96

0.0

304

402

–24.3

280

311

–10.1

TRANSPORTATION Vehicle purchases Cars and trucks, new Cars and trucks, used Other vehicles

8,508 3,421 1,798 1,568 54

8,683 4,002 1,879 2,072 50

–2.0 –14.5 –4.3 –24.3 7.3

Gasoline and motor oil

2,227

1,511

47.3

Other vehicle expenses Vehicle finance charges Maintenance and repairs Vehicle insurance Vehicle rentals, leases, licenses, other charges

2,355 298 688 886 482

2,670 384 731 911 645

–11.8 –22.4 –5.8 –2.7 –25.3

Public transportation

505

500

1.0

HEALTH CARE Health insurance Medical services Drugs Medical supplies

2,766 1,465 670 514 117

2,419 1,151 665 487 116

14.4 27.3 0.8 5.5 0.9

ENTERTAINMENT Fees and admissions Audio and visual equipment and services Pets, toys, and playground equipment Other entertainment products and services

2,376 606 906 412 451

2,181 603 728 391 460

8.9 0.5 24.4 5.4 –2.0

PERSONAL CARE PRODUCTS, SERVICES

585

660

–11.4

READING

117

171

–31.5

EDUCATION

888

740

20.0

TOBACCO PRODUCTS, SMOKING SUPPLIES

327

373

–12.4

MISCELLANEOUS

846

908

–6.9

CASH CONTRIBUTIONS

1,869

1,396

33.9

PERSONAL INSURANCE AND PENSIONS Life and other personal insurance Pensions and Social Security

5,270 322 4,948

3,940 467 3,472

33.8 –31.1 –*

PERSONAL TAXES Federal income taxes State and local income taxes Other taxes

2,432 1,711 519 202

3,649 2,820 658 171

–33.4 –39.3 –21.1 18.2

GIFTS FOR PEOPLE IN OTHER HOUSEHOLDS

1,154

1,268

–9.0

* Spending in 2006 on pensions and Social Security is not comparable with 2000 because of changes in methodology. Note: Average spending is rounded to the nearest dollar, but the percent change calculation is based on unrounded figures. Spending by category will not add to total spending because gift spending is also included in the preceding product and service categories and personal taxes are not included in the total. Source: Bureau of Labor Statistics, 2000 and 2006 Consumer Expenditure Surveys, Internet site http://www.bls.gov/cex/; calculations by New Strategist


Household Spending on Information and Consumer Electronics, 2006 Between 2000 and 2006, average household spending on information and consumer electronics climbed by a substantial 10 percent, to $2,532, after adjusting for inflation. In 2006, the average American household spent almost as much on information and consumer electronics as it did on out-of-pocket health care costs ($2,766). Dramatic is the word that best describes spending trends in the information and consumer electronics category. Most items experienced either a big gain or a big loss between 2000 and 2006, after adjusting for inflation. The average household nearly tripled the amount it spends on cellular phone service during the six-year period. Spending on computer information services (Internet) rose by more than 140 percent. But spending on residential telephone service fell by 39 percent. The average household cut spending on books by 21 percent and spending on newspaper and magazine subscriptions declined an even larger 38 percent. But spending on videogame hardware and software climbed 56 percent during those years, and spending on videocassettes and DVDs grew by an even larger 69 percent. As high-definition television sets became popular, the average household boosted its spending on television sets by 71 percent between 2000 and 2006. Spending on photographic equipment increased by 38 percent as households bought digital cameras. Spending on film, however, fell 74 percent. In 2006, as in 2000, the average household devoted the largest share of its information and consumer electronics spending to residential phone service. In 2006, residential phone service accounted for 21 percent of information and consumer electronics spending, down from a much larger 38 percent share in 2000. Cable service ranked second in both years, its share climbing from 16 to 21 percent. Cell phone service ranked third in 2006, up from fourth in 2000, its share more than tripling from 6 to 21 percent. Computer information service—or Internet service—ranked fourth in 2006, its share more than doubling in the six-year period. Computer hardware ranked fifth, with its share of the information and consumer electronics dollar falling from nearly 10 percent in 2000 to less than 6 percent in 2006.

Spending by age Householders aged 35 to 54 spend the most on information and consumer electronics—more than $2,900 in 2006, or 16 percent more than the average household. A look at spending by detailed category reveals sharp differences in spending patterns by age. Spending on computer information services peaks in the 35-to-54 age group, at 18 to 22 percent above average. Spending on cell phone service skews younger, with spending 24 to 26 percent above average in the 25-to-44 age group. People aged 55 or older control more than half of household spending on newspaper and magazine subscriptions. Householders aged 65 to 74 are the biggest spenders on global positioning system services, while householders under age 25 spend the most on CDs.

Spending by household income Not surprisingly, spending on information and consumer electronics rises with income in most categories. Spending on phone cards, however, is above average only among householders with household incomes between $20,000 and $40,000. Income makes a big difference on book spending. Households with incomes of $100,000 or more spend more than twice the average on books and account for 38 percent of the market—a much greater share than their 16 percent of households. The affluent also account for a disproportionate share of spending on items such as streaming and downloading audio, global positioning services, personal digital audio players (e.g., iPods), and television sets.


Spending by household type Perhaps nothing makes more of a difference in spending on information and consumer electronics than children. Married couples with school-aged or older children at home spend 34 to 41 percent more than the average household on the overall category. Couples with children aged 18 or older at home are the best customers of cell phone service, spending 66 percent more than the average household on the item. Married couples with school-aged children spend more than twice the average on video games and personal digital audio players. Couples without children at home (most of them empty-nesters) spend 73 percent more than the average household on newspaper and magazine subscriptions.

Spending by race and Hispanic origin Blacks and Hispanics spend slightly less than the average household on information and consumer electronics overall, while Asians and non-Hispanic whites spend slightly more than average. Black and Hispanic spending is well above average on a few items, however. Blacks spend 18 percent more than the average household on residential phone service. Hispanics spend almost three times the average on phone cards. Asians spend more on computers, Internet services away from home, personal digital assistants, and cellular phone service than any other racial or ethnic group. Spending on cell phone service is slightly below average among non-Hispanic whites.

Spending by region Spending on information and consumer electronics is well above average on most items in the West, about average in the Northeast and South, and below average in the Midwest. Households in the West spend 45 percent more than the average household on personal digital audio players, 48 percent more on streaming and downloading audio, and 68 percent more on computer software. Spending on books is 30 percent below average in the South. Spending on nonsubscription newspapers and magazines is 44 percent above average in the Northeast.

Spending by education College graduates spend 27 percent more than the average household on information and consumer electronics. On some items, however, their spending is not far above average. College graduates spend only 13 percent more than the average household on cable service and only 9 percent more on residential phone service. They spend 25 percent less than average on phone cards. Book spending shows the biggest difference by education. College graduates spend twice the average on books and control 56 percent of the book market. They spent 58 percent more than the average household on television sets in 2006.


Table 3. Information and consumer electronics spending, 2000 to 2006 (average annual household spending on information and consumer electronics, and percent distribution by type, 2000 and 2006; percent change in spending, 2000–06; in 2006 dollars) 2006 average household spending Information and consumer electronics spending, total Residential telephone and pay phones Cable service and community antenna Cellular phone service Computer information services Computers and computer hardware, nonbusiness use Television sets Books Newspaper and magazine subscriptions Video cassettes, tapes, and discs Telephones and answering machines Videogame hardware and software Compact discs, records, and audio tapes Sound components, equipment, and accessories Photographic equipment Rental of video cassettes, tapes, discs, films Computer software and accessories, nonbusiness use Phone cards Photo processing Personal digital audio players Video cassette recorders and video disc players Newspapers and magazines, nonsubscription Repair of computer systems for nonbusiness use Film Personal digital assistants Streaming and downloading audio Internet services away from home Global positioning services Streaming and downloading video

$2,532.01 541.95 539.04 523.78 176.44 142.59 130.39 53.55 48.66 41.20 34.70 34.10 34.03 33.91 32.56 31.44 21.70 21.16 17.88 17.41 16.12 14.55 6.45 6.39 4.12 3.62 1.64 1.60 1.03

2000 percent distribution

average household spending (in 2006$)

100.0% 21.4 21.3 20.7 7.0 5.6 5.1 2.1 1.9 1.6 1.4 1.3 1.3 1.3 1.3 1.2 0.9 0.8 0.7 0.7 0.6 0.6 0.3 0.3 0.2 0.1 0.1 0.1 0.0

$2,305.76 886.55 376.02 139.89 71.84 219.90 76.46 67.38 77.89 24.35 36.48 21.92 46.20 49.70 23.66 48.66 20.48 – 36.80 – 27.86 25.48 3.22 25.05 – – – – –

percent distribution 100.0% 38.4 16.3 6.1 3.1 9.5 3.3 2.9 3.4 1.1 1.6 1.0 2.0 2.2 1.0 2.1 0.9 – 1.6 – 1.2 1.1 0.1 1.1 – – – – –

percent change 2000–06 9.8% –38.9 43.4 274.4 145.6 –35.2 70.5 –20.5 –37.5 69.2 –4.9 55.6 –26.3 –31.8 37.6 –35.4 6.0 – –51.4 – –42.1 –42.9 100.3 –74.5 – – – – –

Note: “–” means data are not available. Source: Bureau of Labor Statistics, 2000 and 2006 Consumer Expenditure Surveys; calculations by New Strategist


Table 4. Information and consumer electronics: Average spending by age, 2006 (average annual spending of consumer units (CU) on information and consumer electronics, by age of consumer unit reference person, 2006) total consumer units Number of consumer units (in 000s) 118,843 Number of persons per CU 2.5 Average before-tax income of CU $60,533.00 Average spending of CU, total 48,398.32 Information and consumer electronics 2,532.01 Books 53.55 Cable service and community antenna 539.04 Cellular phone service 523.78 Compact discs, records, and audio tapes 34.03 Computer information services 176.44 Computer software and accessories, nonbusiness use 21.70 Computers and computer hardware, nonbusiness use 142.59 Film 6.39 Global positioning services 1.60 Internet services away from home 1.64 Newspaper and magazine subscriptions 48.66 Newspapers and magazines, nonsubscription 14.55 Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

under 25 8,167 2.0 $29,057.00 28,180.58

25 to 34 20,071 2.9 $57,208.00 47,582.37

35 to 44 23,950 3.2 $75,613.00 57,476.34

45 to 54 24,696 2.7 $77,043.00 57,563.25

55 to 64 18,952 2.0 $64,425.00 50,788.79

65 to 74 11,764 1.9 $46,064.00 40,959.64

75+ 11,243 1.5 $29,525.00 28,904.49

1,755.87 28.15 295.44 501.03 46.49 104.83

2,625.40 49.42 523.63 657.56 36.64 194.02

2,947.01 61.12 577.83 648.93 40.94 216.06

2,949.14 63.06 599.80 627.30 42.32 208.74

2,582.39 62.14 583.54 476.18 29.30 181.81

2,155.50 49.62 551.46 292.85 21.65 140.68

1,438.64 31.98 439.36 129.37 8.27 70.13

14.65

22.46

26.67

30.46

18.91

13.89

8.50

117.65 4.08 – 1.06 7.43

149.88 4.47 0.54 1.19 19.11

188.69 6.60 1.30 1.50 35.61

178.36 8.46 2.31 2.82 52.36

133.09 8.23 1.80 2.05 67.05

92.83 7.90 3.29 0.90 80.01

38.97 1.85 1.59 0.70 87.25

10.18

4.12 17.41 21.16 17.88 32.56

4.99 15.61 26.10 14.93 28.34

13.33 7.23 18.63 37.45 18.70 38.74

15.63 4.86 29.03 22.16 21.31 36.64

17.42 5.12 23.92 20.95 18.67 43.07

16.37 2.63 10.04 15.75 20.15 32.70

13.03 0.78 5.68 11.85 19.10 19.48

9.85 0.21 2.17 5.65 4.41 6.29

31.44

34.44

45.84

43.58

35.16

22.94

12.48

3.66

6.45

6.39

5.12

4.87

11.32

6.62

6.19

1.55

541.95

194.86

433.58

599.36

621.17

623.31

584.31

509.69

33.91 3.62 1.03 34.70 130.39

35.60 2.38 0.73 32.34 110.54

34.98 5.06 0.86 28.26 161.54

46.09 4.90 2.00 39.31 143.92

33.04 5.27 1.18 48.02 144.54

34.73 2.35 0.80 27.44 133.26

34.29 0.79 0.46 41.86 112.93

4.97 0.72 0.16 14.50 42.71

16.12 41.20 34.10

24.04 51.26 42.33

16.12 53.37 47.67

20.91 54.49 52.70

18.31 45.97 40.02

13.40 36.64 19.16

11.80 17.40 7.99

4.43 5.95 3.75

Note: “–” means sample is too small to make a reliable estimate. Source: Bureau of Labor Statistics, unpublished tables from the 2006 Consumer Expenditure Survey


Table 5. Information and consumer electronics: Indexed spending by age, 2006 (indexed average annual spending of consumer units (CU) on information and consumer electronics by age of consumer unit reference person, 2006; index definition: an index of 100 is the average for all consumer units; an index of 132 means that spending by consumer units in that group is 32 percent above the average for all consumer units; an index of 68 indicates spending that is 32 percent below the average for all consumer units)

Average spending of CU, total Average spending of CU, index

total consumer units $48,398 100

under 25 $28,181 58

25 to 34 $47,582 98

35 to 44 $57,476 119

45 to 54 $57,563 119

55 to 64 $50,789 105

65 to 74 $40,960 85

75+ $28,904 60

Information and consumer electronics Books Cable service and community antenna Cellular phone service Compact discs, records, and audio tapes Computer information services Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use

100 100 100 100 100 100

69 53 55 96 137 59

104 92 97 126 108 110

116 114 107 124 120 122

116 118 111 120 124 118

102 116 108 91 86 103

85 93 102 56 64 80

57 60 82 25 24 40

100

68

104

123

140

87

64

39

100

83

Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films

100 100 100 100

64 – 65 15

105 70 34 73 39

132 103 81 91 73

125 132 144 172 108

93 129 113 125 138

65 124 206 55 164

27 29 99 43 179

100 100 100 100 100 100

70 121 90 123 84 87

92 175 107 177 105 119

107 118 167 105 119 113

120 124 137 99 104 132

113 64 58 74 113 100

90 19 33 56 107 60

68 5 12 27 25 19

100

110

146

139

112

73

40

12

100

99

79

76

176

103

96

24

100

36

80

111

115

115

108

94

100 100 100 100 100

105 66 71 93 85

103 140 83 81 124

136 135 194 113 110

97 146 115 138 111

102 65 78 79 102

101 22 45 121 87

15 20 16 42 33

100 100 100

149 124 124

100 130 140

130 132 155

114 112 117

83 89 56

73 42 23

27 14 11

Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

Note: “–” means sample is too small to make a reliable estimate. Source: Bureau of Labor Statistics, unpublished tables from the 2006 Consumer Expenditure Survey


Table 6. Information and consumer electronics: Total spending by age, 2006 (total annual spending on information and consumer electronics, by consumer unit (CU) age groups, 2006; consumer units and dollars in thousands)

Number of consumer units Total spending of all CUs

total consumer units 118,843

under 25 8,167

$5,751,801,544 $230,150,797

Information and consumer electronics 300,911,664 Books 6,364,043 Cable service, community antenna 64,061,131 Cellular phone service 62,247,587 Compact discs, records, and audio tapes 4,044,227 Computer information services 20,968,659 Computer software and accessories, nonbusiness use 2,578,893 Computers and computer hardware, nonbusiness use 16,945,823 Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

25 to 34 20,071

35 to 44 23,950

45 to 54 24,696

55 to 64 18,952

65 to 74 11,764

75+ 11,243

$955,025,748 $1,376,558,343 $1,421,582,022 $962,549,148 $481,849,205 $324,973,181

14,340,190 229,901 2,412,858 4,091,912

52,694,403 991,909 10,509,778 13,197,887

70,580,890 1,463,824 13,839,029 15,541,874

72,831,961 1,557,330 14,812,661 15,491,801

48,941,455 1,177,677 11,059,250 9,024,563

25,357,302 583,730 6,487,375 3,445,087

16,174,630 359,551 4,939,724 1,454,507

379,684 856,147

735,401 3,894,175

980,513 5,174,637

1,045,135 5,155,043

555,294 3,445,663

254,691 1,654,960

92,980 788,472

119,647

450,795

638,747

752,240

358,382

163,402

95,566

960,848

759,407 190,149 194,903

33,321 – 8,657

3,008,241 89,717 10,838 23,884

4,519,126 158,070 31,135 35,925

4,404,779 208,928 57,048 69,643

2,522,322 155,975 34,114 38,852

1,092,052 92,936 38,704 10,588

438,140 20,800 17,876 7,870

5,782,900

60,681

383,557

852,860

1,293,083

1,270,732

941,238

980,952

1,729,166

83,140

489,633 2,069,057 2,514,718 2,124,913 3,869,528

40,753 127,487 213,159 121,933 231,453

267,546 145,113 373,923 751,659 375,328 777,551

374,339 116,397 695,269 530,732 510,375 877,528

430,204 126,444 590,728 517,381 461,074 1,063,657

310,244 49,844 190,278 298,494 381,883 619,730

153,285 9,176 66,820 139,403 224,692 229,163

110,744 2,361 24,397 63,523 49,582 70,718

3,736,424

281,271

920,055

1,043,741

868,311

434,759

146,815

41,149

766,537

52,187

102,764

116,637

279,559

125,462

72,819

17,427

64,406,964

1,591,422

8,702,384

14,354,672

15,340,414

11,812,971

6,873,823

5,730,445

4,029,966 430,212 122,408 4,123,852 15,495,939

290,745 19,437 5,962 264,121 902,780

702,084 101,559 17,261 567,206 3,242,269

1,103,856 117,355 47,900 941,475 3,446,884

815,956 130,148 29,141 1,185,902 3,569,560

658,203 44,537 15,162 520,043 2,525,544

403,388 9,294 5,411 492,441 1,328,509

55,878 8,095 1,799 163,024 480,189

1,915,749 4,896,332 4,052,546

196,335 418,640 345,709

323,545 1,071,189 956,785

500,795 1,305,036 1,262,165

452,184 1,135,275 988,334

253,957 694,401 363,120

138,815 204,694 93,994

49,806 66,896 42,161

Note: Numbers may not add to total because of rounding. “–” means sample is too small to make a reliable estimate. Source: Calculations by New Strategist based on the Bureau of Labor Statistics’ 2006 Consumer Expenditure Survey


Table 7. Information and consumer electronics: Market shares by age, 2006 (percentage of total annual spending on information and consumer electronics accounted for by consumer unit age groups, 2006)

Share of total consumer units Share of total before-tax income Share of total spending

total consumer units 100.0% 100.0 100.0

under 25 6.9% 3.3 4.0

25 to 34 16.9% 16.0 16.6

35 to 44 20.2% 25.2 23.9

45 to 54 20.8% 26.4 24.7

55 to 64 15.9% 17.0 16.7

65 to 74 9.9% 7.5 8.4

75+ 9.5% 4.6 5.6


100.0 100.0 100.0 100.0 100.0 100.0

4.8 3.6 3.8 6.6 9.4 4.1

17.5 15.6 16.4 21.2 18.2 18.6

23.5 23.0 21.6 25.0 24.2 24.7

24.2 24.5 23.1 24.9 25.8 24.6

16.3 18.5 17.3 14.5 13.7 16.4

8.4 9.2 10.1 5.5 6.3 7.9

5.4 5.6 7.7 2.3 2.3 3.8

100.0

4.6

17.5

24.8

29.2

13.9

6.3

3.7

100.0

5.7


100.0 100.0 100.0 100.0

4.4 – 4.4 1.0

17.8 11.8 5.7 12.3 6.6

26.7 20.8 16.4 18.4 14.7

26.0 27.5 30.0 35.7 22.4

14.9 20.5 17.9 19.9 22.0

6.4 12.2 20.4 5.4 16.3

2.6 2.7 9.4 4.0 17.0

100.0 100.0 100.0 100.0 100.0 100.0

4.8 8.3 6.2 8.5 5.7 6.0

15.5 29.6 18.1 29.9 17.7 20.1

21.6 23.8 33.6 21.1 24.0 22.7

24.9 25.8 28.6 20.6 21.7 27.5

17.9 10.2 9.2 11.9 18.0 16.0

8.9 1.9 3.2 5.5 10.6 5.9

6.4 0.5 1.2 2.5 2.3 1.8

100.0

7.5

24.6

27.9

23.2

11.6

3.9

1.1

100.0

6.8

13.4

15.2

36.5

16.4

9.5

2.3

100.0

2.5

13.5

22.3

23.8

18.3

10.7

8.9

100.0 100.0 100.0 100.0 100.0

7.2 4.5 4.9 6.4 5.8

17.4 23.6 14.1 13.8 20.9

27.4 27.3 39.1 22.8 22.2

20.2 30.3 23.8 28.8 23.0

16.3 10.4 12.4 12.6 16.3

10.0 2.2 4.4 11.9 8.6

1.4 1.9 1.5 4.0 3.1

100.0 100.0 100.0

10.2 8.6 8.5

16.9 21.9 23.6

26.1 26.7 31.1

23.6 23.2 24.4

13.3 14.2 9.0

7.2 4.2 2.3

2.6 1.4 1.0


Note: Numbers may not add to total because of rounding. “–” means sample is too small to make a reliable estimate. Source: Calculations by New Strategist based on the Bureau of Labor Statistics’ 2006 Consumer Expenditure Survey


Table 8. Information and consumer electronics: Average spending by income, 2006 (average annual spending on information and consumer electronics, by before-tax income of consumer units (CU), 2006) total consumer units Number of consumer units (in 000s) 118,843 Number of persons per CU 2.5 Average before-tax income of CU $60,533.00 Average spending of CU, total 48,398.32

under $20,000 26,075 1.7 $10,783.16 20,824.88

$20,000– $39,999 27,536 2.2 $29,630.20 31,972.38

$40,000– $49,999 11,446 2.5 $44,620.00 39,572.86

$50,000– $69,999 17,674 2.8 $59,253.00 50,085.83

$70,000– $79,999 6,956 2.8 $74,647.00 57,351.54

Information and consumer electronics 2,532.01 Books 53.55 Cable service and community antenna 539.04 Cellular phone service 523.78 Compact discs, records, and audio tapes 34.03 Computer information services 176.44

1,341.32 20.07 335.36 230.29 17.64 65.48

1,918.17 28.93 461.94 397.08 25.21 120.78

2,412.33 42.53 560.94 521.35 34.16 170.96

2,804.30 49.25 592.70 637.09 38.38 205.32

3,036.45 69.54 618.69 683.89 41.35 229.43

3,315.73 75.42 678.60 705.75 40.03 255.91

4,274.77 128.54 763.78 850.98 59.37 324.25

21.70

7.22

9.72

19.65

20.53

31.77

36.24

49.86

142.59

55.52

6.39 1.60 1.64 48.66

3.02 0.21 0.90 24.57

75.75 4.42 0.74 1.04 35.53

101.67 6.08 1.54 1.68 41.77

158.95 7.29 0.87 1.05 50.72

176.39 12.14 3.01 2.09 49.75

215.68 7.69 1.98 1.51 65.70

317.37 10.43 4.86 3.99 93.62

14.55 4.12 17.41 21.16 17.88 32.56

8.69 2.25 4.64 19.93 7.50 7.09

11.02 2.00 6.64 24.22 9.64 15.79

14.51 2.63 8.43 19.54 14.87 24.20

15.71 4.12 19.69 21.20 18.50 37.88

17.74 6.00 24.67 21.06 31.44 33.94

18.66 2.32 31.08 19.20 25.81 44.51

23.31 10.98 43.91 20.43 36.16 85.21

31.44

13.48

23.33

29.95

34.77

46.90

43.64

53.49

6.45

4.08

2.84

6.44

6.49

4.88

7.23

15.13

541.95

393.76

480.59

540.53

588.72

610.34

632.18

718.68

33.91 3.62 1.03 34.70 130.39

11.42 0.93 0.33 23.59 40.49

17.98 1.55 0.67 26.01 72.54

46.25 3.30 1.34 30.95 78.93

42.06 2.46 1.19 33.26 115.91

15.88 3.79 0.93 40.06 135.10

28.69 5.26 1.27 44.38 192.66

81.92 10.69 2.10 59.17 347.74

16.12 41.20 34.10

6.74 20.04 16.06

11.07 30.79 20.34

13.13 40.13 34.87

16.04 45.18 38.97

21.49 56.42 47.76

28.14 56.77 49.42

29.77 68.39 60.64

Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

$80,000– $100,000 $99,999 or more 10,241 18,915 3.0 3.2 $88,763.00 $164,452.00 65,809.86 100,386.31

Source: Bureau of Labor Statistics, unpublished tables from the 2006 Consumer Expenditure Survey; calculations by New Strategist


Table 9. Information and consumer electronics: Indexed spending by income, 2006 (indexed average annual spending of consumer units (CU) on information and consumer electronics by before-tax income of consumer unit, 2006; index definition: an index of 100 is the average for all consumer units; an index of 132 means that spending by consumer units in that group is 32 percent above the average for all consumer units; an index of 68 indicates spending that is 32 percent below the average for all consumer units)

Average spending of CU, total Average spending of CU, index


under $20,000 $20,825 43

$20,000– $39,999 $31,972 66

$40,000– $49,999 $39,573 82

$50,000– $69,999 $50,086 103

$70,000– $79,999 $57,352 118

$80,000– $99,999 $65,810 136

$100,000 or more $100,386 207


100 100 100 100 100 100

53 37 62 44 52 37

76 54 86 76 74 68

95 79 104 100 100 97

111 92 110 122 113 116

120 130 115 131 122 130

131 141 126 135 118 145

169 240 142 162 174 184

100

33

45

91

95

146

167

230

100

39


100 100 100 100

47 13 55 50

53 69 46 63 73

71 95 96 102 86

111 114 54 64 104

124 190 188 127 102

151 120 124 92 135

223 163 304 243 192

100 100 100 100 100 100

60 55 27 94 42 22

76 49 38 114 54 48

100 64 48 92 83 74

108 100 113 100 103 116

122 146 142 100 176 104

128 56 179 91 144 137

160 267 252 97 202 262

100

43

74

95

111

149

139

170

100

63

44

100

101

76

112

235

100

73

89

100

109

113

117

133

100 100 100 100 100

34 26 32 68 31

53 43 65 75 56

136 91 130 89 61

124 68 116 96 89

47 105 90 115 104

85 145 123 128 148

242 295 204 171 267

100 100 100

42 49 47

69 75 60

81 97 102

100 110 114

133 137 140

175 138 145

185 166 178




Table 10. Information and consumer electronics: Total spending by income, 2006 (total annual spending on information and consumer electronics, by before-tax income group of consumer units (CU), 2006; consumer units and dollars in thousands)

Number of consumer units Total spending of all CUs

total consumer units 118,843

under $20,000 26,075

$20,000– $39,999 27,536

$40,000– $49,999 11,446

$50,000– $69,999 17,674

$70,000– $79,999 6,956

$80,000– $99,999 10,241

$100,000 or more 18,915

$5,751,801,544 $543,008,700 $880,391,370 $452,950,956 $885,216,959 $398,937,312 $673,958,776 $1,898,807,054

Information and consumer electronics 300,911,664 Books 6,364,043 Cable service, community antenna 64,061,131 Cellular phone service 62,247,587 Compact discs, records, and audio tapes 4,044,227 Computer information services 20,968,659 Computer software and accessories, nonbusiness use 2,578,893 Computers and computer hardware, nonbusiness use 16,945,823 Film 759,407 Global positioning services 190,149 Internet services away from home 194,903 Newspaper and magazine subscriptions 5,782,900 Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

34,974,968 523,322 8,744,580 6,004,826

52,818,614 796,568 12,719,900 10,933,950

27,611,529 486,798 6,420,519 5,967,372

49,563,198 870,445 10,475,380 11,259,929

21,121,546 483,720 4,303,608 4,757,139

33,956,391 772,376 6,949,543 7,227,586

80,857,275 2,431,334 14,446,899 16,096,287

459,904 1,707,491

694,056 3,325,721

390,995 1,956,808

678,328 3,628,826

287,631 1,595,915

409,947 2,620,774

1,122,984 6,133,189

188,221

267,542

224,914

362,847

220,992

371,134

943,102

1,447,710 78,748 5,370 23,411

2,085,984 121,827 20,401 28,650

1,163,715 69,592 17,627 19,229

2,809,282 128,843 15,376 18,558

1,226,969 84,446 20,938 14,538

2,208,779 78,753 20,277 15,464

6,003,054 197,283 91,927 75,471

640,714

978,440

478,099

896,425

346,061

672,834

1,770,822

1,729,166

226,673

489,633 2,069,057 2,514,718 2,124,913 3,869,528

58,635 121,051 519,768 195,563 184,884

303,552 55,103 182,802 666,859 265,426 434,658

166,081 30,103 96,490 223,655 170,202 276,993

277,659 72,817 348,001 374,689 326,969 669,491

123,399 41,736 171,605 146,493 218,697 236,087

191,097 23,759 318,290 196,627 264,320 455,827

440,909 207,687 830,558 386,433 683,966 1,611,747

3,736,424

351,459

642,462

342,808

614,525

326,236

446,917

1,011,763

766,537

106,428

78,162

73,712

114,704

33,945

74,042

286,184

64,406,964

10,267,189

13,233,589

6,186,906

10,405,037

4,245,525

6,474,155

13,593,832

4,029,966

297,837

430,212 122,408 4,123,852 15,495,939

24,338 8,578 615,183 1,055,831

495,208 42,622 18,492 716,143 1,997,504

529,378 37,772 15,338 354,254 903,433

743,368 43,478 21,032 587,837 2,048,593

110,461 26,363 6,469 278,657 939,756

293,814 53,868 13,006 454,496 1,973,031

1,549,517 202,201 39,722 1,119,201 6,577,502

1,915,749 4,896,332 4,052,546

175,849 522,582 418,823

304,950 847,933 560,108

150,286 459,328 399,122

283,491 798,511 688,756

149,484 392,458 332,219

288,182 581,382 506,110

563,100 1,293,597 1,147,006



Table 11. Information and consumer electronics: Market shares by income, 2006 (percentage of total annual spending on information and consumer electronics accounted for by before-tax income group of consumer units, 2006)



under $20,000 21.9% 3.9 9.4

$20,000– $39,999 23.2% 11.3 15.3

$40,000– $49,999 9.6% 7.1 7.9

$50,000– $69,999 14.9% 14.6 15.4

$70,000– $79,999 5.9% 7.2 6.9

$80,000– $99,999 8.6% 12.6 11.7

$100,000 or more 15.9% 43.2 33.0


100.0 100.0 100.0 100.0 100.0 100.0

11.6 8.2 13.7 9.6 11.4 8.1

17.6 12.5 19.9 17.6 17.2 15.9

9.2 7.6 10.0 9.6 9.7 9.3

16.5 13.7 16.4 18.1 16.8 17.3

7.0 7.6 6.7 7.6 7.1 7.6

11.3 12.1 10.8 11.6 10.1 12.5

26.9 38.2 22.6 25.9 27.8 29.2

100.0

7.3

10.4

8.7

14.1

8.6

14.4

36.6

100.0

8.5


100.0 100.0 100.0 100.0

10.4 2.8 12.0 11.1

12.3 16.0 10.7 14.7 16.9

6.9 9.2 9.3 9.9 8.3

16.6 17.0 8.1 9.5 15.5

7.2 11.1 11.0 7.5 6.0

13.0 10.4 10.7 7.9 11.6

35.4 26.0 48.3 38.7 30.6

100.0 100.0 100.0 100.0 100.0 100.0

13.1 12.0 5.9 20.7 9.2 4.8

17.6 11.3 8.8 26.5 12.5 11.2

9.6 6.1 4.7 8.9 8.0 7.2

16.1 14.9 16.8 14.9 15.4 17.3

7.1 8.5 8.3 5.8 10.3 6.1

11.1 4.9 15.4 7.8 12.4 11.8

25.5 42.4 40.1 15.4 32.2 41.7

100.0

9.4

17.2

9.2

16.4

8.7

12.0

27.1

100.0

13.9

10.2

9.6

15.0

4.4

9.7

37.3

100.0

15.9

20.5

9.6

16.2

6.6

10.1

21.1

100.0 100.0 100.0 100.0 100.0

7.4 5.7 7.0 14.9 6.8

12.3 9.9 15.1 17.4 12.9

13.1 8.8 12.5 8.6 5.8

18.4 10.1 17.2 14.3 13.2

2.7 6.1 5.3 6.8 6.1

7.3 12.5 10.6 11.0 12.7

38.4 47.0 32.5 27.1 42.4

100.0 100.0 100.0

9.2 10.7 10.3

15.9 17.3 13.8

7.8 9.4 9.8

14.8 16.3 17.0

7.8 8.0 8.2

15.0 11.9 12.5

29.4 26.4 28.3




Table 12. Information and consumer electronics:

Average spending by high-income consumer units, 2006 (average annual spending on information and consumer electronics, by before-tax income of consumer units with high incomes, 2006)

Number of consumer units (in 000s) Number of persons per consumer unit Average before-tax income of consumer units Average spending of consumer units, total Information and consumer electronics Books Cable service and community antenna Cellular phone service Compact discs, records, and audio tapes Computer information services Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

total consumer units 118,843 2.5 $60,533.00 48,398.32

$100,000 or more 18,915 3.2 $164,452.00 100,386.31

$100,000– $119,999 6,300 3.2 $108,417.00 78,128.93

$120,000– $149,999 5,357 3.1 $132,682.00 88,646.65

$150,000 or more 7,258 3.2 $236,545.00 128,681.21

2,532.01

4,274.77

53.55 539.04 523.78 34.03 176.44 21.70 142.59 6.39 1.60 1.64 48.66 14.55 4.12 17.41 21.16 17.88 32.56 31.44 6.45 541.95 33.91 3.62 1.03 34.70 130.39 16.12 41.20 34.10

128.54 763.78 850.98 59.37 324.25 49.86 317.37 10.43 4.86 3.99 93.62 23.31 10.98 43.91 20.43 36.16 85.21 53.49 15.13 718.68 81.92 10.69 2.10 59.17 347.74 29.77 68.39 60.64

3,856.99 92.05 706.31 797.79 47.79 291.40 55.33 316.45 10.41 4.11 2.61 75.37 20.15 7.02 27.63 18.62 29.82 63.48 51.14 5.68 652.77 58.16 7.92 1.12 58.32 317.90 26.27 63.32 48.05

4,081.03 115.20 757.33 864.75 62.84 321.88 33.16 311.92 10.10 3.65 3.38 88.63 23.87 6.71 46.19 23.05 31.26 92.44 51.50 15.00 686.09 89.56 9.01 0.95 40.83 228.34 18.95 74.28 70.16

4,781.02 170.06 818.43 886.98 66.85 354.53 57.43 322.18 10.69 6.39 5.65 113.14 25.66 17.57 56.37 20.06 45.27 98.74 57.00 23.43 799.96 96.90 14.33 3.78 74.07 461.77 40.80 68.45 64.53

Source: Bureau of Labor Statistics, unpublished tables from the 2006 Consumer Expenditure Survey



Indexed spending by high-income consumer units, 2006 (indexed average annual spending of consumer units with high incomes on information and consumer electronics, by before-tax income of consumer unit, 2006; index definition: an index of 100 is the average for all consumer units; an index of 132 means that spending by consumer units in that group is 32 percent above the average for all consumer units; an index of 68 indicates spending that is 32 percent below the average for all consumer units)

Average spending of consumer units, total Average spending of consumer units, index Information and consumer electronics Books Cable service and community antenna Cellular phone service Compact discs, records, and audio tapes Computer information services Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software


$100,000 or more $100,386 207

$100,000– $119,999 $78,129 161

$120,000– $149,999 $88,647 183

$150,000 or more $128,681 266

100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100

169 240 142 162 174 184 230 223 163 304 243 192 160 267 252 97 202 262 170 235 133 242 295 204 171 267 185 166 178

152 172 131 152 140 165 255 222 163 257 159 155 138 170 159 88 167 195 163 88 120 172 219 109 168 244 163 154 141

161 215 140 165 185 182 153 219 158 228 206 182 164 163 265 109 175 284 164 233 127 264 249 92 118 175 118 180 206

189 318 152 169 196 201 265 226 167 399 345 233 176 426 324 95 253 303 181 363 148 286 396 367 213 354 253 166 189




Total spending by high-income consumer units, 2006 (total annual spending on information and consumer electronics, by before-tax income group of consumer units with high incomes, 2006; consumer units and dollars in thousands)

Number of consumer units Total spending of all consumer units Information and consumer electronics Books Cable service and community antenna Cellular phone service Compact discs, records, and audio tapes Computer information services Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

total consumer units 118,843 $5,751,801,544

$100,000 or more 18,915 $1,898,807,054

$100,000– $119,999 6,300 $492,212,259

$120,000– $149,999 5,357 $474,880,104

$150,000 or more 7,258 $933,968,222

300,911,664 6,364,043 64,061,131 62,247,587 4,044,227

80,857,275 2,431,334 14,446,899 16,096,287 1,122,984

24,299,037 579,915 4,449,753 5,026,077 301,077

21,862,078 617,126 4,057,017 4,632,466 336,634

34,700,643 1,234,295 5,940,165 6,437,701 485,197

20,968,659

6,133,189

1,835,820

1,724,311

2,573,179

2,578,893

943,102

348,579

177,638

416,827

16,945,823 759,407 190,149 194,903 5,782,900 1,729,166 489,633 2,069,057 2,514,718 2,124,913 3,869,528 3,736,424 766,537 64,406,964 4,029,966 430,212 122,408 4,123,852 15,495,939 1,915,749 4,896,332 4,052,546

6,003,054 197,283 91,927 75,471 1,770,822 440,909 207,687 830,558 386,433 683,966 1,611,747 1,011,763 286,184 13,593,832 1,549,517 202,201 39,722 1,119,201 6,577,502 563,100 1,293,597 1,147,006

1,993,635 65,583 25,893 16,443 474,831 126,945 44,226 174,069 117,306 187,866 399,924 322,182 35,784 4,112,451 366,408 49,896 7,056 367,416 2,002,770 165,501 398,916 302,715

1,670,955 54,106 19,553 18,107 474,791 127,872 35,945 247,440 123,479 167,460 495,201 275,886 80,355 3,675,384 479,773 48,267 5,089 218,726 1,223,217 101,515 397,918 375,847

2,338,382 77,588 46,379 41,008 821,170 186,240 127,523 409,133 145,595 328,570 716,655 413,706 170,055 5,806,110 703,300 104,007 27,435 537,600 3,351,527 296,126 496,810 468,359




Market shares by high-income consumer units, 2006 (percentage of total annual spending on information and consumer electronics accounted for by before-tax income group of consumer units with high incomes, 2006)



$100,000 or more 15.9% 43.2 33.0

$100,000– $119,999 5.3% 9.5 8.6

$120,000– $149,999 4.5% 9.9 8.3

$150,000 or more 6.1% 23.9 16.2

Information and consumer electronics Books Cable service and community antenna Cellular phone service

100.0 100.0 100.0 100.0

26.9 38.2 22.6 25.9

8.1 9.1 6.9 8.1

7.3 9.7 6.3 7.4

11.5 19.4 9.3 10.3

Compact discs, records, and audio tapes Computer information services Computer software and accessories, nonbusiness use Computers and computer hardware, nonbusiness use Film Global positioning services Internet services away from home Newspaper and magazine subscriptions Newspapers and magazines, nonsubscription Personal digital assistants Personal digital audio players Phone cards Photo processing Photographic equipment Rental of video cassettes, tapes, discs, films Repair of computer systems for nonbusiness use Residential telephone service and pay phones Sound components, equipment, and accessories Streaming and downloading audio Streaming and downloading video Telephones and answering machines Television sets Video cassette recorders and video disc players Video cassettes, tapes, and discs Video game hardware and software

100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

27.8 29.2 36.6 35.4 26.0 48.3 38.7 30.6 25.5 42.4 40.1 15.4 32.2 41.7 27.1 37.3 21.1 38.4 47.0 32.5 27.1 42.4 29.4 26.4 28.3

7.4 8.8 13.5 11.8 8.6 13.6 8.4 8.2 7.3 9.0 8.4 4.7 8.8 10.3 8.6 4.7 6.4 9.1 11.6 5.8 8.9 12.9 8.6 8.1 7.5

8.3 8.2 6.9 9.9 7.1 10.3 9.3 8.2 7.4 7.3 12.0 4.9 7.9 12.8 7.4 10.5 5.7 11.9 11.2 4.2 5.3 7.9 5.3 8.1 9.3

12.0 12.3 16.2 13.8 10.2 24.4 21.0 14.2 10.8 26.0 19.8 5.8 15.5 18.5 11.1 22.2 9.0 17.5 24.2 22.4 13.0 21.6 15.5 10.1 11.6



Table 16. Information and consumer electronics: Average spending by household type, 2006 (average annual spending of consumer units (CU) on information and consumer electronics, by type of consumer unit, 2006)

total consumer units

total married couples

married couples, no children

118,843

59,428

2.5

3.2

$60,533.00

married couples with children total

oldest child under 6

oldest child 6 to 17

oldest child 18 or older

single parent, at least one child

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