Is Refurbished The Future Of Smartphones?

Turnover
rates of old to new smartphones are slowing down in 2019, which makes total
sense as consumers are more cautious of pulling the trigger and spending a
thousand dollars over a new model device.

Refurbished Smartphone Industry On
The Rise

It all
started in 2017, when consumers started choosing refurbished units over
brand-new mobile phones. According to the report made by Counterpoint, the
global refurbished market grew by 13 percent, which accounts for approximately
140 million products. Back Market U.S. coordinator Serge Verdoux states that
the figure could get closer to around 22 percent.

The website
Back Market was established in 2014 and handled aggregrate sales of refurbished
electronics in Europe. In 2018, the site started handling U.S. customers and
discovered the high demand for refurbished smartphones. Furthermore, the site
found out that sales for refurbished electronics were about ten times as much
as its Europe-based counterpart in the same six-month span.

What Are The Factors Revving Up
Refurbs?

In 2016,
data showed a forecasted slowdown in the mobile phone industry, more notably
the lack of new phone buyers in regions Europe, China and the United States.
Companies turned their attention to other markets to compensate for the
potential loss of profit. To match the financial capabilities and expectations
of the consumers, smartphone manufacturers turned to refurbished as a way to
sell at a lower price without losing sales or profits.

The problem
with this was that there were other smartphone companies who dominated this
part of the market. Competition came from makers such as Xiaomi, OPPO and the
like, who dominated with their budget offerings. In the fourth quarter of 2017,
these companies were touted as the fastest growing brands according to the
Global Smartphone Shipments Ranking and Market Share
(https://www.counterpointresearch.com/apple-surpassed-samsung-become-number-one-smartphone-brand-4q-2017/)

One factor
that drives the refurbished market growth is the fact that shareholders are
keen on maximizing the lifetime value of smart phones when they realized that
there’s money to be had in refurbished models.

Companies Introduce Refurbished
Policies and Systems

Profit
potential hasn’t been lost with tech giants such as Samsung and Apple. These
brands are major players in the refurbished niche, and each one has their own
robust platform for collecting and selling refurbished products in many
countries. Some of the better known model units that are getting a second life
include the Galaxy S and the older iPhones.

Making some
headway into the refurbished industry is a wise move to compensate for the loss
of sales in the new phone department. Mobile network giants and carriers have
been doing it for years, offering rebates and promos for older phones in a
trade-in procedure. Increased turnover rate is better for both consumer and
phone manufacturer alike, as brands get the revenue they need while satisfying
the economic demands of the public.

What’s more,
there are various recycling and take-back programs that make it easy to give
your older device in exchange for a small amount of cash or a discount towards
a refurbished model. Take a look at the following:

Samsung
Responsible Recycling.
Offers convenient take-back options on various electronic products.

Apple
GiveBack.
You get a
competitive offer for a trade-in. Any eligible device may be inspected at an
authorized Apple Store. If successful, you get a refund or an Apple Store gift
card for your troubles.

Motorola
Mobility.
Has a few
take back programs with recyclers, retailers, carriers and consumers.

The greatest
response came in from Europe and the US, with rapidly emerging markets in
India, Southeast Asia and Africa. All major mobile network operators have come
up with initiatives to include full life cycle services.

What Effect May The Emerging Industry
Have For The Future?

Consumers
can look forward to being able to get a buyback for their current device at any
point during their ownership. Possibly via manufacturers or independent
specialists like Freestyll – which specialises in refurbished Apple products.

High costs
of upgrading to the newer models can be offset a bit, which helps improve sales
and turn the economy.

Refurbished
units will continue to grow as they provide a win-win for both sides. According
the newest IDC report, the market will grow up to $52 billion over the next 5
years.

The Switch to Refurbished Has Its
Advantages

The lower
price is the biggest benefit of buying refurbished. Consumers can now buy
almost any kind of electronic appliance, item or device at a much lower cost
than a brand-new one. Businesses can get refurbished TVs, tablets, laptops and
smartphones and save money for use on other assets.

Buying
refurbished is better for the environment in a number of ways. One, manufacture
impact is slowed down; two, the less electronic items we buy, the lesser the
amount of e-waste we produce. Last, less devices made equal less raw materials
used, fuel and greenhouse gas emissions.

Refurbished
is here to stay for the considerable future. The benefits it has on the
environment, the consumer and the smartphone brands are many and they are all
positive. Buying refurbished means you save money and help save Mother Nature
as well. For this reason the trend can only head one way- up!

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