Short-term spike in SA feature phone sales

2016-06-05 17:43 - Duncan Alfreds, Fin24
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Smartphones. (Duncan Alfreds, Fin24)

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Cape Town – Price is the reason for an even split between first quarter smartphone and feature phones in SA, a research organisation has said.

Smartphones and feature phones are evenly poised in SA in the first quarter of 2016, according to the International Data Corporation (IDC).

Data from the industry organisation showed that feature phone and smartphone sales had equal shipments of 2.1 million units each in the first three months of 2016.

The IDC data for the quarter showed that in SA, smartphone sales declined by 5% year on year, while feature phone sales increased by 6%.

“Consumers need to make a choice between buying luxury goods and buying the essentials to keep their household operational,” Teboho Leshage, senior research analyst of Imaging Printing, Document Solutions and Handset at the IDC told Fin24.

However, the feature phone sales increase may be temporary. 

READ: Here are SA's most popular smartphone, tablet brands

“We do not see an increase in the sales for feature phones due to tough economic climate,” Leshage said.

“First, with the tough economic climate, consumers’ disposable income will be adversely impacted, which will probably not boost the sales but help the feature phones not fade away easily," he added.

Leshage further said that smartphones are still becoming more affordable in South Africa, despite the trend in the first quarter of 2016.

“Smartphones are becoming more and more affordable in South Africa. This is good news for a consumer who wants the benefits of having a smartphone but cannot currently afford it,” Leshage said.

Samsung leads the local smartphone market, followed by Vodacom branded devices and Huawei, according to the IDC.

But locals are not flocking to premium Samsung devices, said the IDC.

“Samsung dominated the smartphone market in quarter one of 2016; this dominance was fuelled by Samsung’s Galaxy J1 Ace and Galaxy J5, the two models have low average selling prices,” said Leshage.

He said that the top three vendors accounted for over 70% of market share because of low average selling prices (ASPs) and sales decreased overall, following festive season shopping.

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