Refurbished smartphone sales declined 1% globally in 2019, Indian market saw a 9% growth
The trend has been changing since many people now prefer to buy a cheap new smartphone instead of buying a refurbished one and there are a lot of options in the former category available in the US and Europe.
The global smartphone market witnessed a decrease in shipment in 2019 and that also affected the global market for refurbished phones that went down as well. Counterpoint Research data reveals that manufacturers sold 137 million refurbished smartphones in 2019 (9% of their total sales) and this figure was a 1% decrease from the previous year.
However, certain markets saw an increase in the sale of refurbished smartphones like India, Africa and the Latin American regions.
According to Jeff Fieldhack, research director at Counterpoint, this is the first time in four years that the refurbished market has witnessed a decline for the full calendar year. The trend has been changing since many people now prefer to buy a cheap new smartphone instead of buying a refurbished one and there are a lot of options in the former category available in the US and Europe.
Another factor that contributed to the decline in refurbished smartphone sales is the sluggish economy and lack of a proper ecosystem for the refurbished market to make a profit.
Refurbished devices are still preferred in relatively underpenetrated markets like the Latin America where a new premium device is not very affordable. However, sales in these markets as well are expected to drop over 2020 thanks to the pandemic.
"In terms of smartphones, these markets remain underpenetrated. Many users are looking for affordable devices to come online. The transition from feature phones to smartphones and the aspiration of premium devices at an affordable price point continue to fuel growth in these markets," Varun Mishra, Research Analyst at Counterpoint Research, said in a statement.
According to the Counterpoint report, Apple and Samsung continued to dominate the refurbished market in 2019 with the Galaxy S series being the main driver for Samsung.
"Apple continues to foster its trade-in and insurance programmes. This also makes sense for Apple as it has been focusing on its service segment. The experience of these services is more enriched with the newer hardware, and a strong trade-in program can help users upgrade," the report said.
Samsung has also been quite aggressive with its buy-back programs and the addition of more repair partnerships. Another brand which made significant sales in this market was Huawei and they used new sales and brand building efforts to increase their presence in the refurbished market.
"But the US sanctions are likely to hurt sales and the brand outside of China in 2020 unless an agreement is made within a China-US trade deal," the Counterpoint report said.