Yahoo Finance Used and Refurbished Smartphone Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The global used and refurbished smartphone market (henceforth referred to as the market studied) was valued at 251. 09 million units in 2021, and it is expected to reach 459. 86 million units by 2027, registering a CAGR of 10.
New York, May 19, 2022 (GLOBE NEWSWIRE) -- Reportlinker.com announces the release of the report "Used and Refurbished Smartphone Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)" - https://www.reportlinker.com/p06227801/?utm_source=GNW
23% during the period of 2022-2027 (henceforth referred to as the forecast period).
Key Highlights
Multiple product launches in the premium smartphone segment, more brand options, new price points, and the overall aspirational value of an upgraded smartphone are some of the significant factors rapidly driving the second-hand smartphone industry to increase its market in multiple geographies globally.
The ability to use a previously owned device to fund the purchase of either a new or used device is also playing a crucial role in the growth of the used and refurbished smartphone market. The trade-in, combined with the increase in financing plans (EIP), is also anticipated to act as a significant driver for the used and refurbished smartphone devices over the forecast period.
An increase in the upgrade cost has been one of the prominent reasons for the market’s growth. An increase in the prices of premium smartphones led to multiple consumers holding on to their phones much longer than expected. However, at the same time, this factor also raised the average selling price of a pre-owned device.
The overall mobile device industry has declined due to supply concerns, large inventory levels, and declining customer demand due to high inflation. The smartphone will spend the next decade acting increasingly as a central hub until being completely replaced by wearable screens, ubiquitous voice assistants, and ambient interfaces, thanks to converging trends, such as 5G and AI in the cloud. This might be a deadly trend for smartphones.
The emergence of COVID-19 led to a movement toward working from home and studying from home. The trend toward remote work has been steadily growing over the past decade. However, the effect of COVID-19 has dramatically accelerated this trend in an extremely short period, forcing companies, irrespective of their size, to adapt quickly to the self-isolation measures that governments across the world were recommending.
Delayed availability of new handsets owing to supply chain constraints and lower disposable cash due to the pandemic has pushed local demand for refurbished smartphones to new milestones. According to the CEO of Yantraa, refurbished smartphones in the price bracket of INR 4,000 - INR 6,000 got stock out in less than 30-minutes which suggests the increasing demand for used phones in the market.
Key Market Trends
Growing Popularity of E-commerce Platforms for Used and Refurbished Smartphones
The market witnessed several players making strategic investments and acquisitions to tap into the growing secondary smartphone market. For instance, to diversify and expand its association with offline retailers, in July 2021, the popular re-commerce platform Cashify announced that it would help offline retailers sell refurbished smartphones online. Cashify also acquired UniShop, an omnichannel retail solution platform, to enable businesses to start a full-fledged online store. This new service line will be rebranded as PhoneShop.
Moreover, in November 2021, Meridiam invested EUR 15 million in CertiDeal, a prominent French circular economy digital platform selling top-of-the-range smartphones, tablets, and other devices refurbished in-house in France.
In January 2022, Flipkart Group announced the acquisition of Yaantra, an electronics re-commerce company, for an undisclosed amount as part of efforts to strengthen its re-commerce business and enhance its re-commerce business after-sale offerings for its customers in the smartphones segment.
Such an increase in buy and sell platforms has, in turn, increased the visibility and helped sellers to get the right price for their old phones. It has standardized the secondary smartphone market and has also increased competition among different players in the market.
As e-waste is the world’s fastest-growing solid-waste stream, increasing at a rate three times faster than general waste in the country such as Australia, the market sentiments have switched over to buying refurbished smartphones which have gained traction among several players such as Boost Mobile, Cole’s, and Phoenix Cellular.
Amazon, the world’s largest online retailer, has a dedicated section for refurbished devices. Customers can sell their old smartphones to Amazon in exchange for a discount on a new gadget. The business inspects them and makes any required repairs to seem and function as new. These devices are then sold in the refurbished sector. They’re even backed by a vendor or manufacturer’s limited warranty.
Supply chain concerns and chip shortages are also helping to propel the refurbishing sector forward. Businesses are turning to refurbished electronics suppliers to meet this demand, which is projected to drive the refurbished electronics industry, particularly Smartphones.
North America Expected to Register Significant Growth
The growing advancements in smartphone features and the expanding scope of the 5G smartphones are some of the major factors driving the growth of North America’s used and refurbished smartphone market. The United States is one of the most advanced markets for smartphone vendors globally. The region has a history of developing innovative smartphones, especially with vendors, like Apple, that have changed the market dynamics of the global smartphone market.
According to GSMA, North America will surpass 1 billion 5G connections by 2022 and 2 billion by 2025, driven by continued network investments from operators and the expanding range of 5G smartphones at varying price points. By 2025, North America will have become the first region where 5G accounts for more than 50% of total connections.
The region is also witnessing the trend of low-end smartphones and mid-range devices, as many smartphone manufacturers believe it is more viable during the market situation affected by the COVID-19 pandemic. Although other brands and product lines are available, iPhones and premium Samsung flagship products mainly accounted for the major market shares. The changing trends can drive the region’s used and refurbished smartphone market.
North American trade-in service providers witnessed product business growth in the last few years due to companies and consumers updating and upgrading their devices due to the changes in the workplace and workforce. For instance, in February 2021, Phobio, a trade-in service for mobile operators and consumer electronics brands, was named a trade-in provider to three new companies: Hyperion Partners, Amazon Canada, and Drone Nerds. The company approximately doubled its revenue in 2020. This momentum continued in 2021 as the company added new business.
Refurbished smartphones market in the region has been witnessing increasing investments. For instance, in May 2021, within three years of launching in North America, Back Market, a dedicated refurbished electronics marketplace, announced an investment round of USD 335 million led by General Atlantic, with the support of Generation Investment Management and existing investors Aglaé Ventures, Goldman Sachs Growth Equity, Eurazeo, and Daphni.
Competitive Landscape
The competitive rivalry amongst the used and refurbished smartphone providers is very high, owing to the presence of various smartphone brands across the globe. Some of the major smartphone giants are Samsung, Huawei, Apple, Xiaomi, Oneplus, and many more, competing for market shares across the world. The demand for refurbished smartphones has spiked in recent years due to the massive smartphone penetration across developing countries. This has led to an increased focus on customer acquisition and formulating distribution channels as key strategies to maintain competitive advantage and market share.
March 2022 - The iPhone 12 and iPhone 12 Pro models were introduced to Apple’s official Certified Refurbished store. A new battery, a new outer shell, authentic Apple part replacements (if necessary), and a one-year warranty are included with products purchased from Apple’s Certified Refurbished store.
September 2021 - Reboxed Limited secured GBP 1 million in funding during the new seed investment round led by the Ministry Of Sound and angel investors and totaled up to GBP 705K. Funds raised in this round aim to support the launch of the Reboxed Recycling Service, enabling customers and retailers to trade in used devices through the Reboxed TechCheck software.
Additional Benefits:
The market estimate (ME) sheet in Excel format
3 months of analyst support
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