Second Hand SmartHone Market Booming Trade In Prices Pushed Up

The second-hand smartphone market is booming with trade in driving sales in Australia according to both carriers and retailers such as JB Hi Fi.

"According to the latest research study from Custom Market Insights, the demand for Global Refurbished and Used Mobile Phones Market size & share was valued at approximately US$64.10 Billion in 2022 and is expected to reach US62.79 Billion in 2023.

Overall growth is tipped to be 11.45% during the next two years.

How the market works is that used smartphone that have been returned to a manufacturer or retailer such as JB Hi Fi is then sent to be inspected and re packaged.

After testing and inspecting the devices’ internal and external components with some parts particularly covers or display screens replaced the products are then returned to the market.

Any models that are deemed unfit to be resold are discarded.

According to researchers the average trade-in value of smartphones since COVID have risen more so in Q1 2023 as inflation pressures affected many families.

US consumers scraped back $865 million through trade-in programs in Q1 2023 according to figures from Assurant's latest Mobile Trade-in and Upgrade Industry Trends report,

The average iPhone trade-in value surpassed $350 for the first time since 2021.

Other stats to come out of the report include the fact the top five traded devices during the quarter were the iPhone 11, iPhone XR, iPhone 12, iPhone 11 Pro Max and iPhone 12 Pro Max.

The iPhone 11 made up 38% of these, while the Pixel 6 Pro was the top traded Android device.

The average age of the smartphones traded-in was 3.35 years, slightly older than 3.26 years in Q4 2022.

Overall, the online trade in business grew by 41% during the past year.

As for wearables, the Apple Watch Series 7 commanded the highest average trade-in value at $150 a 22% value decrease from Q4 2022.

"An increase in trade-in values shows how smartphones are retaining their value, meaning carriers, retailers, cable operators, and OEMs can offer more appealing trade-in and upgrade deals to consumers—increasing their subscriber base and making it a win-win-win for all," said Biju Nair, EVP & President, Global Connected Living & International at Assurant.

"These industry players get to boost sales and maintain customer loyalty, consumers get money in their pockets, something which is very much needed in today's challenging economy, and devices stay out of landfills and get to live a second life.".

According to IDC researchers the second-hand market and the demand for refurbished models is contributing to the slowdown in new models.

ChannelNews understands that manufacturers, retailers, and third-party second-hand phone Companies in Australia are now being forced to offer more for trade ins, which might have benefits for customer retention.

Another factor that can affect stats about the value of trade ins are schemes brought in by manufacturers such as Samsung and Apple who not only manufacture and sell a smartphone, but they also then offer a trade in price for a model pushing the traded in model to the open market.

Currently Google in the USA is offering healthy trade-in deals for its new pricy Pixel Fold – including A$1,300 for the iPhone 14 Pro Max.