Even though the global smartphone direct sales market showed ominous signs of growth in the second quarter, there was strong momentum for trade-in and upgrade programs in the United States and the amount of money back into the hands of consumers through trade-in programs has been found. increased significantly quarter-over-quarter and year-over-year at the end of the third quarter of 2022, according to research by global business services firm Assurant.
Using data from Assurant’s Device IQ analytics platform, along with industry market data, to provide insight into device trade-in and upgrade trends in North America, the report quarterly Mobile Recovery and Upgrade Industry Trend Report for Q3 2022, revealed a steady pace of growth in the secondary device market with approximately $970 million returned to US consumers in Q3 2022 through mobile device trade-in and upgrade programs. Not only was this the highest third quarter on record, but it also represented a 28% year-over-year increase.
The report describes the top smartphones returned through trade-in and upgrade programs during the quarter, the average smartphone trade-in value, as well as Apple Watch trade-in trends.
Among the highlights, the average device trade-in value was $111, down $26 from the prior quarter. For the second consecutive quarter, the iPhone 11 was the first device received under the trade-in and upgrade program. The device accounted for 38% of the top five devices shipped, closely followed by the iPhone XR, which was the best device throughout 2021.
In an indication of the maturity of the smartphone arena, the analysis highlighted the fact that the iPhone 12 was the first 5G smartphone to make the top five returned list. Looking at the Android phone arena, the Galaxy S9 remained the flagship device surrendered as it has since Q2 2020.
For wearables, the Apple Watch Series 7 continued to have the highest trade-in value at $171, followed by the Apple Watch Series 6 at $109.
The total number of transactions conducted online in the third quarter saw an 86% year-over-year increase compared to the same quarter last year. Since the pandemic, more and more consumers have been seen to shift their trade-in business from store to e-commerce.
The study also found that the average age of traded-in devices fell slightly across the board, to 3.46 years from 3.5 years last quarter. The average age of traded-in iPhones is now 3.41 years old, while the average age of traded-in Android smartphones is 3.56 years old.
“We typically see higher volumes for device trade-ins in the third and fourth quarters due to new device launches at this time of year, prompting consumers to upgrade,” Biju said. Nair, Executive Vice President and President, Connected and Global World at Assurant commenting on the study.
“Although the average trade-in value has declined, the total dollars returned to consumers through trade-in programs increased significantly in the third quarter as we saw more customers take advantage of trade-in offers. Positive volumes reflect consumers’ reception to the various promotions that carriers, OEMs, cable operators and retailers are offering to migrate customers to 5G-enabled devices and premium service plans.
More generally, the analyst noted that many consumers are becoming dependent on promotions for their purchases of new devices, especially during times of economic uncertainty, such as the current inflationary environment.
Assurant added that globally, its customers and their customers are now paying increasing attention to sustainability initiatives and how exchange and upgrade programs allow them to contribute to those initiatives.
To date, Assurant has found that through these programs, 16.5 million devices have been collected, resulting in the diversion of over 3,000 metric tons of potential e-waste from landfills.
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