During a time when nearly all industries are in flux due to COVID-19’s economic impact, consumers’ minds are fixated on finding saving money wherever they can. While few people will be disconnecting from their cell phones to save money, many are rethinking their spending habits in regards to device upgrades. Many people are taking savvy measures and using trade-in “hacks” to reduce the cost of owning a smartphone.
WeSellCellular recently set out to capture a snapshot of attitudes and trends regarding trade-in and cost-saving practices in the current economic climate. End-user feedback is important for retailers and wholesalers because it offers a way to make measurable predictions and assessments regarding demand and customer behavior going forward. To get a better understanding of attitudes and habits regarding phone upgrades, we asked customers to share how they’ve approached saving money amid COVID-19. What many in the resale industry may find fascinating is how quickly phone users have adapted by using hacks that allow them to get the devices and models they want while managing costs. For some, adapting has been a necessity due to the fact that they’ve lost access to work phones while companies are shut down. Others simply have had a hard time justifying the cost of a new phone.
Pouncing on Discounts
Many customers are taking the patient route by waiting for discounts that would put pricey phones within reach. “I recently bought a new cell phone and was able to save a significant amount of money by waiting for a special discount on a less recent model,” shares Jesse Silkoff, Co-Founder and President of MyRoofingPal. Many respondents repeated Silkoff’s sentiment of being willing to wait for a discount on a slightly older model.
“Verizon is my service/contract provider, and I always wait until they have exceptional deals on new phones before I buy,” shares Dan Bailey, President of Wikilawn Lawn Care. “This means I sometimes miss out on the latest models, but I’m not usually bothered by that.” Generally, it seems that customers are less obsessed with getting the “latest and greatest” models than they are with paying a reasonable price for a good product.
Seeking Manufacturer-Exclusive Upgrade Options
For some phone customers, simply inquiring about what their preferred manufacturer is willing to offer is the best strategy for upgrading. Laurie Wilkins, the Founder of Call Outdoors, shared that he was able to trade in his old iPhone for a new model by cashing in Apple gift cards that were paid out when he gave back his old phone. “The experience was quick and easy, and it’s not much of a hassle, except for the fact that I had to physically go to the store,” says Laurie. Laurie’s experience shows that customers are willing to make the physical journey to a brick-and-mortar store if it means getting what looks like the best deal. Laurie also shared that he had no apprehensions about letting his old device go if it meant saving a little more. “I’ll probably never use my old phone anyway, so I think it’s a better deal than letting an old device gather dust in my drawer,” he reasons.
Opting for Refurbished
Many phone customers are happily making the transition to refurbished phones after discovering that they can potentially save hundreds of dollars. “I’ve done this several times through the Apple Store, and while it means I might not have a bleeding-edge phone, I always get the current generation for much, much less than buying it at the normal cost,” shares Rex Freiberger, CEO of Gadget Review. As an expert in all things tech, Freiberger has a unique understanding of the benefits of refurbished devices when sourced correctly. “You just need to make sure you’re doing this directly from the manufacturer, or from a trusted third-party,” he shares. “Just buying a refurbished model through Amazon or Walmart or some other online store is often a recipe for disaster,” Freiberger cautions. This point echoes a much larger, universal thought that is seen among phone buyers we queried in 2020. None of the respondents we engaged with were willing to accept an inferior product to save money. However, nearly all were willing to be calculated about “bargaining down” for a slightly older or simpler model if that meant saving money. For retailers and wholesalers selling used smartphones, this means never compromising on quality, and ensuring accurate testing and grading of all products.
The final trend that we’re seeing among customers right now is a big emphasis on being patient. The perception in the phone market up until recently has generally been that people are “chomping at the bit” to get their hands on the latest devices each season. While this will always be true among a subset of phone buyers, it does appear that more people are simply content to hold on to their current devices until the right deal pops up. This take-it-or-leave-it view of phone upgrades points to a growing trend of hanging on to something as long as it’s working instead of jumping devices just for the sake of getting the latest features. This particular trend will likely have a negative impact on used smartphone supply, but will hopefully be counteracted by other trends, such as increased adoption of trade in options.
Conclusion: Phone Buyers are Using Creativity and Flexibility to Get the Best Deals
It’s clear that “getting a good deal” is a priority for consumers seeking new devices right now. The urgency of jumping to the next and best model seems to have all but faded for the time being. However, it’s clear that buyers are generally very willing and eager to upgrade to a new device as long as certain criteria are met. Those criteria are that a discount is being offered and the phone is coming from a reputable source.
Industry insiders like Liz Hamilton, the Director of People and Customers at Mobile Klinik, are taking notice. “If you lost your phone or it’s beyond repair, purchasing a certified pre-owned cell phone (a good shop will offer a solid warranty) is another alternative that should be considered before buying another brand new phone,” says Hamilton. She adds, “For the most part, you’ll be purchasing a well-featured cell phone at a lower price point than a similar new model for a sound reduction in the price.”
The big takeaway from WeSellCellular’s deep dive into customer habits is that phone buyers are generally more conservative at the moment—however, they are not so scared of spending on a new phone that they are not willing to hop on good deals when they come across them. The overarching trend we can observe is that customers are getting more creative when it comes to using hacks or purchasing strategies instead of simply going through the traditional purchasing cycle. This trend in consumer behavior will have mixed effects on the industry for wholesale cell phones. On the one hand, the adoption of trade-in will likely increase, but consumers will likely hold onto their phones longer before trading in. Hopefully, the former will outweigh the ladder and our industry will continue to benefit from the move towards cost-consciousness.