![]() ![]() Third, there would likely be a margin in processing used phones, similar to that earned by car dealers. Used, refurbished premium smartphones may be more appealing than new unbranded devices. Second, the availability of a formal second-hand market could make their devices more affordable to customers with smaller budgets, without having to create less profitable, budget variants of their devices. First, encouraging an annual replacement cycle among a growing number of users may increase annual sales. Deloitte Global would expect that over time, most markets should see a steady increase in trade-ins.įor smartphone vendors the direct benefits of a thriving second-hand market are three fold. In Singapore, about a quarter of smartphones were traded in in Norway, Italy, Russia and Finland, only five percent were sold or exchanged. Of these two-thirds sold their smartphones outright, and a third traded them in with an operator or device manufacturer. Deloitte member firms’ research in 20 markets found that as of mid-2015 approximately 12 percent of all consumers sold their smartphones. Globally, we expect there to be significant variation in the practice of trading in smartphones by market. However, in the future specialist companies may emerge which forecast trade-in values after one, two or more years of ownership, similar to the equivalent service providers in the automobile industry. A decade back, those wishing to sell their old phones would often use online auctions or marketplaces, which could be far slower and uncertain relative to being quoted a trade-in value at the point of sale, or simply swapping one phone for another with a leasing plan. We expect the market for acquiring second- (or third- or fourth-) hand devices to become steadily more organized. The remainder will likely be sold online privately, to retail shops or to second-hand device specialists.įor consumers the primary incentives to sell a device - rather than keeping it as a spare, giving it to a family member or throwing it away - will likely be driven by the ease of doing so, the luster of owning a latest model device and the trade-in value on offer. About half of the devices are expected to be traded in to manufacturers or carriers in exchange for credit toward a new smartphone. We predict at least 10 percent of premium smartphones ($500 or higher) purchased new in 2016 will end up having three or more owners before being retired, and will still be used actively in 2020 or beyond. What’s more, we expect the practice of selling smartphones could well accelerate through 2020 as both consumers and suppliers increasingly embrace the practice of selling or acquiring second-hand smartphones. And the growth rate of the used smartphone market is forecast to be 4-5 times higher than the overall smartphone market. The value of sold or traded-in smartphones will likely be about twice that of wearables and 25 times the value of the virtual reality (VR) hardware market. This is a 50 percent increase from the 80 million smartphones traded in 2015, with a value of $11 billion, or an average value of $135. Deloitte Global predicts that in 2016 consumers will sell outright or trade in approximately 120 million used smartphones generating more than $17 billion for their owners, at an average value of $140 per device. ![]()
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