Premium models and increasing prices dominate the market
Imagine you are holding a next-gen smartphone in your hand: Improved technology, an even slimmer design, the best display yet – and the price? Higher than ever before. This reflects the trend in 2024. The smartphone market experienced a significant increase in value of 3% in the first eight months, although demand grew only by a moderate 1.6%. A clear sign that consumers are willing to dig deeper into their pockets. The average price of smartphones climbed from $360 last year to $388. One reason for growth: in 2024, many customers are replacing the three-year-old devices they bought during the 2021 sales boom.
Smartphones in use for longer: The shift to later upgrades
72% of consumers who replaced their smartphone in the first half of 2024 had used the previous device for three years or more. This is a significant increase compared to 2021, when only 52% of consumers replaced phones that old. Consumers are now using their smartphones much longer. This is likely due to the increasing durability and functionality of modern devices. However, when consumers do upgrade, they are more likely to invest in premium models. The data shows that in 2021, only 6% of smartphones sold cost more than $900. By 2024, this share has risen to 13%.
Premium smartphones: sales drivers for product launches
The trend towards premium smartphones is particularly evident in major product launches. In the launch week of a leading smartphone manufacturer, revenues in 2023 rose by up to 27% compared to a normal week – a trend that was seen across multiple manufacturers. These prominent launches are the ultimate sales driver.
The trend towards premium smartphones is increasingly shaping the strategies of manufacturers, who are increasingly relying on their flagship models. The latest market launches at IFA 2024 also clearly showed this. For many manufacturers, the top models account for up to 75% of revenues in the first two weeks after market launch.
The smartphone market continues to evolve, and one thing is certain: those who want the latest technology are willing to dig deeper into their pockets for it – a trend that will continue to drive growth in the coming years.