Only 3% of USA Today readers would buy a smartphone over US$1,000 (about AU$1,410) according to an online survey of 1,303 readers.
The survey is really about sentiment and who knows what will happen once a consumer faces the tsunami of marketing hype or the salesperson lusting after more commission. But it does reflect what the typical US buyer thinks.
Smartphone price sensitivity (USD)
- $1000+ 3% would buy
- 751-1000 16%
- 501-750 25%
- 301-500 26%
- <300 30%
In GadgetGuy’s interview with Danny Adamopoulos, the Motorola Australia chief said as much, “The Australian smartphone industry in 2019 heralds the era of the affordable mid-range.”
He sees the <$200 pre-paid market exploding – spoilt for choice. The Moto e5 is as good as last year’s G-series and half the price.
The other area of growth is the <$500 segment where features only found in the $751+ market now abound.
While only 3% of the US will buy a $1000+ phone, there are the ‘whales’ in Asia that regard a smartphone as a status symbol. Overall flagship devices are less than 10% of the market.
Foldables and 5G
About half had heard of foldables (otherwise you are living under a rock) but had no desire to use one, let alone fork out US$1500 or more. About two-thirds had heard of ‘blazingly fast 5G’.
But when asked if these were drivers to replace a phone there was a resounding “No”. The drivers were
- Longer battery life (iPhone 76% and Android 77%)
- A better camera (52%)
- Bigger screen (not foldable) 31%
- 5G (when it is ready and cheaper 2020+ not now) 37-40%
- Foldable (phone to tablet) 17-19%
- Retro or nostalgic devices like Motorola Razr flip or Nokia feature phones no interest
Stickiness to operating systems/brands
Over 90% of iPhone and Android users would not swap OS confirming GadgetGuy’s report OS Switching is all but over.
And as Huawei is not a major player in the US brand stickiness was high as well. 54% of the Android respondents owned Samsung, and it was likely to remain that way. In Australia,
The average upgrade cycle was ‘every couple of years’ based largely on the Teclo lock-in contracts.
Interestingly all respondents were happy with their existing phone and what it does
As for upgrade motivation – extra juice (batteries do wear out) and better cameras. There is little recognition of AI advancements, new OS versions, or added functionality – to most a smartphone is simply a phone, SMS, email/calendar and a camera.
iPhone users are hanging onto phones longer – 40% had had it over two years. That reflects Apple’s analysis, but we venture it is because of the huge price increases forced on the pubic last year. In fact, 45% of iPhone users said they had held off upgrading due to price. 55% of iPhone users were happy with the current device.
Interestingly only 21% of Android users have had their device over two years. In that market, fierce competition has forced prices down and features up. 65% of Android users also said they were happy with how their current phones were working and were not planning to upgrade.