Are we buying more expensive phones?

It might seem obvious to some people that smartphones are getting more expensive. After all, the iPhone X came out at an incredible £1,149, making headlines as it did so. However, it seems that this tactic is paying off for brands like Apple, as the amount of money they're making is going up.

This data came from Growth from Knowledge (GfK), a global market research firm, which has collected information about sales volume and value for smartphone in the last quarter of 2017. Between October and the end of the year, $18.8 billion (around £13.3 billion) of smartphones were sold across western Europe.

This is an increase of 17 per cent compared to the same period of 2016. However, interestingly, this rise in sales value is not coming from an increase in the actual number of phones sold. In fact, that figure is declining.

In quarter four 2017, around 37 million smartphones were sold in western Europe. However, this is a decrease of three per cent compared to 2016, when 38.3 million devices were sold in the same period.

This means that, while we're buying fewer phones, the ones we purchase are more expensive. This would suggest that a good tactic for the industry would be to produce more hi-spec, flagship handsets with high price tags, like the iPhone X.

This isn't just happening in Europe; China, another major global smartphone market, has seen almost exactly the same thing happen. Just like western Europe, the number of phones sold dropped by three per cent in the last quarter of 2017, but the value increased by 17 per cent.

Of course, China is a much bigger market, selling roughly 114.7 million phones compared to western Europe's 37 million. But the same pattern can still be seen. However, this isn't the case all over the world. In fact, in most cases sales volume and value both increased.

North America, for example, saw a six per cent increase in the number of phones sold, along with a four per cent rise in their value. Meanwhile, in central and eastern Europe the number of phones sold increased by seven per cent. However, the value of those sales skyrocketed by 28 per cent, suggesting a growing market for more expensive handsets.

Developed Asia appears to be the worst place in the world for smartphone manufacturers, as sales there declined by nine per cent. While other regions made up for this with an increase in sales value, this wasn't the case here; the sold phones cost a total of $13.2 million, which is a drop of five per cent compared to the last quarter of 2016.

Arndt Polifke, global director of PoS telecom research at GfK, said that globally, “sales value increased by 11 per cent year-on-year in the quarter, which is exceptional growth for such a mature technology category”.

He added: “This came as the proliferation of smartphones with larger and bezel-less displays incentivized consumers to purchase more expensive devices.”

Written by Mazuma

Mazuma Mobile is the UK's most trusted mobile phone recycling service.

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