The global market for used smartphones is growing rapidly, according to a new report from the International Data Corporation (IDC). The report estimates that the worldwide shipments of used smartphones will reach 333.2 million units in 2023, with a compound annual growth rate (CAGR) of 13.6% from 2018 to 2023.
The report attributes the growth of the used smartphone market to several factors, such as the increasing quality and durability of smartphones, the rising prices of new devices, the environmental awareness of consumers, and the expansion of trade-in and buy-back programs offered by manufacturers, carriers, and retailers.
The report also identifies some challenges and opportunities for the used smartphone market, such as the lack of standardization and regulation, the potential impact of 5G networks and devices, and the emergence of new business models and channels.
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According to Anthony Scarsella, research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker, “The demand for used smartphones is extremely high in both developed and emerging markets. Although drivers such as regulatory compliance and environmental initiatives are still positively impacting the growth in the used market, the importance of cost-saving for new devices will continue to drive growth.
Overall, we feel that the ability to use a previously owned device to fund the purchase of either a new or used device will play the most crucial role in the growth of the refurbished phone market. Trade-in combined with the increase in financing plans (EIP) will ultimately be the two main drivers of the refurbished phone market moving forward.”
The report segments the used smartphone market by region, device type, and operating system. The regions covered are North America, Latin America, Western Europe, Central and Eastern Europe, Middle East and Africa, Asia/Pacific (excluding Japan), and Japan. The device types are premium ($500+), high ($300-$499), mid ($200-$299), low ($100-$199), and ultra-low (<$100). The operating systems are Android, iOS, and others.
Why is Used Smartphone Demand Rising?
The smartphone market is constantly evolving, with new models and features being released every year. However, not everyone can afford or wants to buy a brand-new device every time. That’s why the used smartphone market is booming, with around 309.4 million units sold in 2023, according to IDC. (That’s up almost 10% on the preceding year.)
But what are the factors behind this trend? Why are more and more people opting for second-hand phones instead of new ones? Here are some of the main reasons:
Environmental awareness: Many consumers are becoming more conscious of the environmental impact of their choices, especially when it comes to electronic waste. According to the EPA, Americans generated 3.1 million tons of e-waste in 2019, of which only 17.4% was recycled. By buying a used phone, consumers can reduce their carbon footprint and help conserve natural resources.
Trade-in deals: Major carriers like AT&T, Verizon, T-Mobile and Sprint offer attractive trade-in deals for customers who want to upgrade their phones. These deals allow customers to exchange their old phones for credit towards a new one, or even get a free phone in some cases. This creates a steady supply of used phones that can be refurbished and resold by the carriers or third-party vendors.
Recycling programs: Some smartphone manufacturers also have their own recycling programs that encourage customers to return their old devices for recycling or reuse. For example, Apple has a program called Apple Trade In that lets customers trade in their eligible devices for an Apple Gift Card or credit towards a new purchase.
Apple also has a program called Apple GiveBack that accepts any Apple device for recycling, regardless of its condition or value. These programs help Apple reduce its environmental impact and create a loyal customer base.
Phone insurance: Another source of used phones is phone insurance, which covers accidental damage, theft or loss of a device. Many customers who have phone insurance opt to get a new device when their old one breaks or gets lost, instead of repairing it or finding it. This leaves behind a lot of used phones that can be repaired and resold by the insurance companies or their partners.
Demand in developing countries: Finally, one of the biggest drivers of the used smartphone market is the demand in developing countries, where many people cannot afford or access new phones. According to Deloitte, at least 10% of smartphones purchased in 2016 will still be in use in 2020, by their second or even third owners.
Many of these owners live in emerging markets like India, China, Brazil and Nigeria, where smartphones are essential for communication, education, entertainment and commerce. Used smartphones offer an affordable and convenient way for these consumers to access the benefits of mobile technology.
As you can see, there are many reasons why the used smartphone market is growing and will continue to do so in the future. Whether you are looking for a cheaper alternative to a new phone or Smartphone want to sell your old phone for some extra cash, you can take advantage of this trend and find a suitable option for your needs.