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The Real Significance Of CES

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CES or the Consumer Electronics Show held each January in Las Vegas, is the largest technology show in North America. It is only rivaled by IFA, the largest consumer tech show in the world, held in Berlin in early fall each year. CES attendance is in the 140,000-160,000 range, while IFA draws closer to 240,000 to its show.

However, CES is a trade show and restricts its audience to just tech industry professionals. IFA also dedicates the first part of the show just to tech professionals but invites the public to the show towards the end of their worldwide trade event. 

CES 2022 will be the 55th anniversary of the winter CES Las Vegas show, and I have attended 48 of them. Additionally, over the years, I have served on CES’ Advisory Boards and led Supersessions during the Winter CES shows. I have actually attended more CES events because for many years, from the early 1980s through the mid-1990s, CES also had a summer show in Chicago and I went to many of those as well.

It is produced by the Consumer Technology Association (CTA), the trade organization that supports the companies that create consumer and business technologies from around the world. They track the trends and forecast consumer technology sales, especially in the U.S. 

Last week the Consumer Technology Association (CTA) released their prediction for consumer spending in 2021 and said it would be another record year for the U.S. tech industry. In its latest bi-annual industry forecast, the CTA upgraded its sales forecast from earlier this year to $487 billion, a 7.5 percent jump from an already record-breaking 2020.

“The pandemic strengthened consumers’ relationship with technology forever,” Gary Shapiro, the CTA’s president, and CEO said. “From working to learning, staying connected with loved ones, and taking care of our health, tech played a crucial role in improving our lives. Tech has proved time and again that innovation makes our country resilient in the face of crises.”

As you can see from the chart below, CTA expects smartphones to be a major driver of industry growth this year, with 5G devices contributing an estimated $61 billion to a total of $73 billion in smartphone sales. Laptops are also expected to see another strong year as many Americans continue to work, study, and socialize from home in face of the pandemic.

For most people, CES is a tech show where the latest and greatest new tech is unveiled. While that is what it is best known for, its real significance is the role it plays between vendors, distributors, and retailers and the dealmaking that is made behind the scenes. Most of these deals are done privately and have a major impact on what comes to market in the 4th quarter of any given year. 

The timing of the Winter CES is strategic for this dealmaking. It begins the buying cycle for the back half of any current year and especially for the fall and holiday selling season. Companies do show off new products publicly, at Winter CES, especially ones ready to be sold in the first half of the year. But, most of the products the vendors show the distributors and retailers are products that will not be announced until late summer or early fall, with an eye on them being on the market for the holiday season. Hundreds of billions of dollars of tech products are ordered through these meetings at CES.

The other major significance for Winter CES is that vendors show these new products that are in development to determine interest from distributors and retailers about their acceptance and demand for them later in the year. In essence, the vendors rely on feedback and orders from their distributors and retailers to pre-order the products for the fall so that they know how many to build and by when they need to have them in the market. Given the R&D cycles for these unannounced products take anywhere from six to nine months, most new products shown behind the scenes are almost all coming to market just-in-time for the fall and holiday season. 

While CES' main purpose is to be a technology industry trade show, it has evolved and added an area for start-ups to show off their new products in a section called Eureka Park. They have also organized the show floors to reflect dedicated interests, such as areas just for health technology, sports tech, home, and IOT as well as giant sections where major companies like Sony, Samsung, LG, and others show off all of their new products that mostly will ship in the first half of any given year. 

One could argue that the need for an in-person trade show is less important given that so much of the buying and selling could be done via other digital means. Indeed, even with a trade show, a lot of selling and buying these days, and especially the actual transactions, are done digitally. Perhaps over time, trade shows may lose their appeal to some degree but given the history and success of CES, especially over the last 20 years, and the demand from CTA's members for a physical show remains strong, a Winter CES in Vegas could have legs for many years to come.

One other experience of going to CES is the ability to see products in person and touch, feel and even play with products on display. Seeing a new 70 inch 8K TV in person vs over some streaming media is not the same thing. And the networking and special events that companies have for their customers and the media are a big part of companies' branding and customer relations programs. 

Last year CES had to be all digital and that was successful in its own right. CES 2022 will be an in-person show as well as a digital one given the reluctance of many who choose not to attend CES in January due to ongoing Covid concerns. Indeed, due to so many international travel restrictions because of the pandemic, the international audience will be light at best. CES will have over 1000 companies exhibit in January, compared to over 2500 in a normal year. 

It will also have major keynotes from Mary Barra, CEO of GM, Mike Seivert, CEO of T-Mobile, and other top business leaders that have not been announced yet. 


Although CES is a tech trade show that is a platform to introduce new products, its most important value is to connect CTA companies and tech vendors with distributors and retailers, which is their lifeline for selling their products to businesses and consumers.

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