The report claims that despite global slowdown, refurbished smartphone market grew 14 per cent in India in 2018
The global market for refurbished smartphones slowed to one per cent year-over-year growth in 2018, reaching close to 140 million units, according to the latest research from Counterpoint’s Refurbished Smartphone Tracker. The secondary industry slowed due to the 11 per cent drop in new smartphone sales in key supply countries such as China and the United States.
However, Tom Kang, Research Director at Counterpoint Research said that the refurbished smartphone market in India grew despite the global slowdown. This growth, as per Kang, was impressive because the refurbished market ecosystem is still nascent in the country.
Kang said, “The India market grew 14 per cent to almost 14 million refurbished devices. This is an impressive number because the refurbished market ecosystem remains nascent in the country and 72 per centof devices in India do not go into the secondary market. Therefore, there are tremendous growth opportunities.”
Cashify, a India based company operating in the refurbished smartphones market in India had recently claimed that it had bought more than one million used smartphones in 2018. The average transaction value, as per Cashify, per used smartphone was Rs 4,500. Cashify has also said that the average upgrading span had gone down from 12 to 14 months to 10 to 12 months.
It is also to be noted here that India accounted for 10 per cent of total refurbished smartphone devices in 2018. The number of refurbished devices that made the used smartphone market in 2018, were approx 140 million devices.
Reasons refurbished market registered slowdown
The size of secondary market played a crucial role in the slowdown of refurbished smartphone market worldwide. Kang said, “The refurbished smartphone market cooled because of the slowdown of new device sales. The US and China markets saw lower upgrade cycles in 2018, which affected the flow of devices into the secondary market.”
He added, “In addition, China and US trade tensions held up devices in customs much longer than normal. This was especially true during the first half of the year.”
Actions required to grow the industry
The research company is of strong view that standardised and improved grading system will help grow the market globally in future. Jeff Fieldhack, Research Director at Counterpoint Research believes that standardised and improved grading system is important for growth of emerging refurbished smartphone markets.
Fieldhack said, “For the refurbished market to expand in new markets, the grading system must be standardized and improved. This is especially true in emerging markets where there is limited oversight and limited protections for consumers if the quality is lower than advertised. There will be improvements as the industry is using new technologies such as artificial intelligence to predict device usability and lifespans.”
He added, “There are also new software solutions being developed which will revolutionize grading. This will vastly improve on today’s diagnostic checklist. The next generation of diagnostic tools will be able to test many more components of the smartphone with the result being a much more qualified grading system.”