Sure the extra money can be spent on other items, but once the kids are out of the house and the obligatory spending on groceries goes down, the same consumers would be looking at replacing the cheap audio gear with something with more advance engineering (maybe a Wiim amp) or a class A or class A/B amp.
Most consumers will never spend a dime on high-end audio amps. They are satisfied with inexpensive amps that sound "perfect" (to them) and will find other ways to spend money as/if they accrue it over the years. We're in a bubble and we have to remember that most regular consumers just don't care nearly as much about audio quality as we do.
Advanced engineering in audio gear is only worthwhile if it results in a measurably better product -- by whatever criteria you value (noise, distortion, longevity, MTBF, linearity, etc.). If a $280 pair of Fosi V3 mono amps outperforms an $800+ class A/B amp, what's the motivation to "upgrade"?
You can already see quite a few of the Topping dac offerings going with pennies on the dollar on eBay, perhaps too many sellers are addicted to the cheap hobby.
That's the beauty of cheap stuff. I have DACs from Emotiva, Audioengine, Audioquest, M-Audio, Topping, SMSL, JDS Labs, and probably some more that I can't remember. It's been a lot of fun and most have been problem-free. Features and performance varied, with the older units performing significantly worse. I had $99 'invested' in a Topping D10 and I bought the newer Topping E30II Lite for $99 which blows it away in performance and features. Had I been playing in the Chord/Linn/etc. price class, I'd likely be using something much older and much more expensive that performs much worse than the E30II Lite.
I used to wonder about the strategy that companies from China are using in releasing a new Amp model every 6-9 months. I used to think it was about meeting the markets in different countries, but that seems inefficient since a lot of gear sold poorly (the A08 is an example) and might have to be sent back. I am now in the camp that the marketing is coming from above.
I am convinced that it's all about profits -- even when I don't understand how they make profits.