Monday, February 26, 2024

Sales are down, but the high-end is up

This is nothing new; they sell very few smartphones. What is so amazing is tha, every year, this event is repeated. Last year, we already told this medium how, according to the technology market analysis company Canals, worldwide sales fellby  11%. Now, the American consulting firm IDC has revealed that the situation has not improved. Shipments of new mobile phones fell by 3.2% in 2023.

Of course, the high end is in luck. The global market for premiumsmartphones continuess to experience record sales in 2023.

What is the origin of this phenomenon? What is happening in the global phone market? Let’s analyze the reasons for Economy 3.

The geopolitical context has an influence

The demand for new mobile phones fell, mainly due to two factors: inflation and the geopolitical context. A fact that does not influence the use of phones, according to the consulting fir,.

Shipments of used smartphones increased worldwide by 9.5% in 2023, compared to 2022, compared to what happened to new mobile phones, which fell 3.2% in the same year, according to IDC estimates.

In particular, in 2023, 309.4 million used or reconditioned units will be shipped, representing a turnover of 59,744 million euros. On the other hand, 1.17 billion new mobile phones were shipped worldwide.

What can we expect in the coming years? The consulting firm’s estimates suggest that there will be 431.1 million shipments of used mobile phones in 2027. This means an annual growth rate of 8.8% in 2022. It is expected that in 2027, the turnover of these mobile phones will reach 109,666 million dollars. It is important to emphasize that although the development of the secondary market is significant, it is slow compared to previous forecasts.

The high-end is experiencing a golden age

It may appear that the consumer is trading in a new one for a repaired one. However, when we examine the available data, we know that the winner is thehigh-endd.

According to data from another consulting firm, Counterpoint, global market sales of premium smartphones (those priced above $600) will grow 6% year-on-year in 2023, reaching a new record. This is contrary to the expected decline in the global market for smartphones, which we discussed.

In particular, it is expected that the part premium will capture nearly a quarter of the world’s smartphone marketshare andd 60% of revenue in 2023. In recent years, this segment has emerged as an area of ​​growth in a market that is generally, and according to data, weak.


Source: Counterpoint Research Market

Varun Mishrasenior, analyst at Counterpoint, explains this phenomenon: “Consumers are willing to spend more to get a high-quality device that they can use for a longerperiode. Owning the latest and most advanced flagships has also become a status symbol for many consumers. Especially in emerging markets, where they go directly from the intermediate price band to the premium band“. Moreover, he added, “These devices become more affordable due to promotional periods and financing options.“.

The king of smartphones

Apple remains the undisputed leader of the premium market, with a 71% share in 2023. However, compared to 2022 (75%), its share has decreased this year. This is mainly due to the resurrection of Huawei in China, driven by the Mate 60 series, as explained by the consulting firm.

Samsung also gaineda  share thanks to the S23 and folded series, almost 1%, from 16% to 17%. The Korean multinational remains the second brand for another year of premium purchases.


Source: Counterpoint Research Market

On the other hand, most of the premium marketgrowth inn 2023 will be driven by China, Western Europe, India, and the regions of the Middle East and Africa (MEA).It is expected that China, India, and Latin America will see a new market sales record when India is the fastest-growing premium market worldwide.

Within the premium market, this is the ultra-segment premium, the driver of growth. The $1,000+ price segment will capture more than a third of total premium market sales by 2023.

World Nation News Desk
World Nation News Desk
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