Despite the crisis and a drop in demand, the average price of a smartphone rose in the second quarter, according to a study by Counterpoint. While the demand for affordable devices has declined, the market for premium models has been more resilient.
For this study, Counterpoint uses data, the average wholesale price (ASP) or the average wholesale price. According to this company’s study, this average sales price increased by 10% in the second quarter of 2020 compared to the average sales price in the same period of 2020.
This has increased on all continents except Latin America. And that would have been only 1% in Europe. This increase in the average price for smartphones despite the crisis could be explained by several factors.
The premium segment is more crisis-resistant
“While the COVID-19 pandemic has impacted the entire smartphone market, the high-end segment has been very robust, with a small 8% year-over-year decline in the quarter compared to the largest decline in the global smartphone market “we read in a counterpoint article.
“The economic impact of the pandemic on the potential user base of the premium segment was smaller compared to other customer segments.”adds the company. On the flip side, Apple, the main player in the premium segment, was ultimately not too badly hit by the pandemic in the second quarter.
The surge in 5G smartphone shipments is also believed to have contributed to this increase in the average retail price of smartphones around the world. Counterpoint estimates that 5G devices account for 10% of global shipping but 20% of industry revenue.
In the second quarter, most of the 5G models were still premium devices, while today we have more 5G models, but affordable models like the OnePlus North. In addition, sales of 5G smartphones were increased in China, where the economy had already recovered in the second quarter.
On the other hand, the mid-range and entry-level smartphone market has been harder hit by the crisis and containment. These devices are more common in stores, but not online. And people who are interested in these devices would have avoided unnecessary expenses due to the economic situation.
“Overall, lower demand for cheaper devices due to the economic impact and offline store closures, the resilience of the high-end segment, and the surge in 5G sales, particularly in China, contributed to the rise in ASP in the quarter (Note, Average price) for a smartphone at “, sums up counterpoint.