The pre-smartphone days gave the secondary mobile device market a bad reputation.
Locked into two-year contracts for devices, any accident led to an inevitable trip to the carrier to receive a refurbished device. Malfunctioning refurbished devices caused reporters and bloggers to create content all about the dangers of embracing the secondary market.
It didn’t take long for consumers to distrust secondary mobile devices. And that secondary market reputation carried over in the age of smartphones.
However, smartphones retain more of their value than ever, giving us an opportunity to change the narrative around the secondary market. We just have to dispel the myth that used/refurbished smartphones are somehow bound to fail.
The Secondary Smartphone Myth
Back in 2015, an article came out on Business Insider that warned consumers never to trust refurbished and pre-owned devices. Without diving too deep into the details, this quote sums up the common feeling about secondary smartphones:
“As a general rule, expect any refurbished device, even one from a major brand, to have a significant risk of failure. With a refurbished device, it’s in a third-party’s best interest to find any reason it can not to honor the warranty.”
This quote is echoed in some way in many different articles. Consumers simply don’t trust the secondary market. We know that device processing is more stringent than ever, but a mindset shift has to happen at the consumer level.
That mindset shift depends on realizing that as devices retain more of their value, the secondary market inherently becomes more trustworthy.
Consumers Hold onto Phones Longer
Studies show that consumers are happy to hold onto their phones longer than in the past. What was once 50% year-over-year growth for smartphone sales has dwindled to less than 2%.
The reality is that annual upgrades to smartphone hardware/software has become somewhat iterative. Every manufacturer has essentially made slight changes to Apple’s original, 2007 iPhone, relying on camera innovation, screen upgrades, and software innovation to drive sales over the years.
But consumers realize that their 2 or 3-year-old iPhone can still access social media apps, banking apps, and get online just as well as a brand-new device—without costing them upwards of $1,000. Our own research confirms that the average trade-in device is about 2.5 years old.
And that’s exactly why consumers should have more faith in the secondary market. The combination of better backend logistics and phones that hold value longer creates a secondary market full of refurbished/used devices consumers can count on.
Then, the real question becomes: “what’s the most financially-sound way for me to approach the smartphone buying process?”
Get the Most Value for Your Smartphone
We’ve said this before, but it bears repeating—the best time to trade in your smartphone is (almost) always right now.
Your mobile devices depreciate every day, so the longer you wait to trade it in, the less value it will provide towards a new phone. Most consumers apply this idea to new devices by getting involved with deals like the Apple iPhone Upgrade Program.
However, it’s important to remember that this idea applies to devices that are on their second, third, even fourth lives as well. There’s never a time when old devices have to sit in drawers. Instead, take advantage of your carrier’s trade-in program regardless of the age/condition of your phone—even if it can’t go on to the secondary market, the right program will recycle it properly.
The value you get from trading your device is a direct reflection of its demand in the secondary market. Don’t let outdated myths cloud your judgment of the secondary market. Even if you aren’t purchasing refurbished devices, the secondary smartphone market still provides you with value.
If you want to learn more about all the value consumers get from the secondary market, check out our new infographic that lays out our trade-in research.