Used smartphones take 21% of global sales; Samsung declines as middle market disappears

The smartphone market is continuing to highlight major changes in consumer demand patterns, as the chart confirms;

  • Used smartphones are now 21% of the total market, compared to just 4% in 2014
  • 309m were sold last year, versus 1.1bn new smartphones
  • New sales are in long-term decline and were down 22% from 2015’s 1.55bn peak
  • Used sales are seeing exponential growth, up 450% since 2014

The data is flagging up critically important changes in consumer demand patterns, as the chart shows:

  • Samsung’s issue is that they were the market leader in 2013 with a 32% share
  • But the middle market is now disappearing and they are now down to 20%
  • 60% of the market is now held by low-cost Chinese companies (‘T0p 3’ and Others)

As analysts Canalys note:

“Products in the mid-to-low-end price range are the growth drivers“.

Essentially, Samsung’s core market is disappearing, and it doesn’t have a Value product to compete with Chinese suppliers. So it is losing market share:

“Samsung focused on the mid-to-high-end segment for profitability but lost share in the low-end segment and also its leading position in the global market.”


The issue is that the market is returning to the pre-SuperCycle model. Companies can either compete on Value and price, or on Luxury and “high perceived value”, as the chart suggests.

Unsurprisingly, China is leading in the Value segment:

  • Xiaomi entered the market in 2014 with a 2% share, but has now reached ~14%
  • Low-cost producers such as OPPO, VIVI and Transsion are also all fighting for share
  • And they are building brand-loyalty to compete with the Western majors

Apple is also under threat, particularly in China, as discussed here in the Q3 update. Not only did it have to offer 5% – 8% discounts last month as the New York Times reports.

But its sales still fell 30% in early January. Rising US trade tensions are encouraging Chinese consumers to support local producer Huawei, as Counterpoint report:

“Apple is facing competition from a resurgent Huawei in the premium segment and multiple China OEMs digging into iPhone 13 and 14 volumes.”


As Computer Weekly has confirmed, replacement cycles are also changing:

“For smartphones, at least, this will likely translate into lengthier replacement cycles. Rather than upgrading devices every 2 years, most enterprises managing large Apple smartphone fleets will shift to 3 – or perhaps 4-year cycles. Why would they not?

“But this won’t stop at smartphones.”

In other words, smartphone volumes are set to continue falling – at the same time as pricing pressures are increasing – as noted here in August:

“Apple have changed strategy to maintain market share and profits:

  • In the past, they focused on latest model iPhones. But today’s iPhone sites show every model
  • They are now happy for you to choose a cheaper, older, model instead of top-of-the-range
  • So they now offer the SE at €559 alongside the 14 Pro at €1349
  • And iPhones now dominate the second-hand market, with a 49% share”

These changes in demand patterns are not just impacting Apple and the smartphone market.

They are already impacting suppliers to the market. And they are also starting to impact a vast range of other major consumer markets.