Used smartphone market to be worth US$65b by 2024

Refurbished and used smartphones are expected to be in hot demand, growing from 225.4 million units in 2020 to 351.6 million units in 2024, a compounded annual growth rate of 11.2 percent, according to IDC.

In 2020, much of the 9.2 percent growth was driven by mature markets where trade-in emulates a form of subsidy to push consumers to upgrade. Rapid growth is also seen in trade-in programmes and average selling prices (ASPs) across numerous channels. Flagship offerings continue to rely heavily on trade-in programmes to make the upfront cost more affordable to consumers.

Apple, Samsung, and Huawei are among those that have adopted this tactic with very aggressive trade-in offers compared with other channels.

On the other hand, telcos are using trade-in combined with bundling (family plans and services) to get consumers to turn over their old device and upgrade.

Although 2020 volume was not as large as expected, the used market still performed well compared with the new market, where IDC is expecting a 6.4 percent decline for smartphones for the year. Overall, the research firm still expects to see double-digit growth during the forecast period, at an average of 11.8 percent.

“In contrast to the recent declines in the new smartphone market, as well as the forecast for minimal growth in new shipments over the next few years, the used market for smartphones shows no signs of slowing down across all parts of the globe,” said Anthony Scarsella, Research Manager of IDC’s Worldwide Quarterly Mobile Phone Tracker.

“Refurbished and used devices continue to provide cost-effective alternatives to both consumers and businesses that are looking to save money when purchasing a smartphone. Moreover, the ability for vendors to push more affordable refurbished devices in markets where they normally would not have a presence is helping these players grow their brand as well as their ecosystem of apps, services, and accessories,” he added.

Will Stofega, Program Director of Mobile Phones at IDC, noted that although the COVID-19 pandemic has posed challenges for secondary market participants around able-bodied workers and logistics, most of the industry has been able to satisfy demand for refurbished smartphones.

“Once the pandemic begins to fade, those that were able to invest in technology will be well-poised to prosper during the recovery,” he said.

Photo: Tim Gouw from Pexels