Research firm Gartner has recently published a report stating that today’s mobile users are actually willing to spend more cash on high end smartphone devices. As indicated in the report, it is projected that people will be spending close to $400 billion on their handsets this year, which represents a 4.3 percent increase compared to the previous year’s.
Moreover, Gartner’s report says that the average pricing of mobile devices will go up by 2 percent. Mobile users based in the North American continent are already considered by industry watchers as the highest paying smartphone owners in the world. As a matter of fact, a report by another research firm, Statista, states that in 2013, US consumers spent an average of $531 for a device, and in 2017, that average will increase to $567 for each smartphone.
So what is driving the increase in pricing of smartphone devices? According to Gartner, it may have something to do with both the rise in the costs of parts and components needed in manufacturing today’s handsets, and of course, the willingness of the average consumer to shoulder some of the ballooning costs, especially if the product in question can deliver quality.
As explained by Ranjit Atwal, the research director of Gartner, the global smartphone market is becoming less price sensitive. The fact of the matter is -- people and business establishments are now looking to purchase higher quality products that are appropriate for their needs and preferences, instead of just selecting the products with lowest prices.
Also having an impact is the growing popularity of phone brands from China. Not only have these Chinese phone makers made basic phones more available, they practically also are responsible for increasing the average selling price of basic phones by 13.5 percent last year. Essentially, what these mobile manufacturers from China have done is put basic phones that have higher quality compared to older basic phones in the market, and in the process, notched up the average selling price of supposedly cheap devices.
Accordingly, with the increased pricing of basic phones, the cost of high end devices also get a push upwards. As predicted by Annette Zimmermann, research vice president at Gartner, the launch of Samsung’s Galaxy S8 models and Apple’s iPhone 8 later this year, will likely increase the average pricing of a flagship device 4 percent in North American mobile markets in 2017. And the thing is -- we probably will not mind that much.
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