The Indian smartphone market, the world’s second-largest after China, is experiencing a significant shift towards used devices.
The above chart from IDC indicates the growth of smartphone business in India during 2019-2023.
According to IDC research, India’s used smartphone market is expected to grow 9.6 percent in 2024, outpacing new smartphone shipments, which are projected to grow at 5.5 percent.
Only a third of the 650 million Indian smartphone users have a 5G smartphone, the rest are still using 4G smartphones. The price differential between 4G and 5G smartphones and the lack of wide availability of 5G models under INR 10K (US$125) is restricting their upgrade to a 5G device.
Key Factors Driving Growth
Affordability: Rising average selling prices (ASP) of new devices, improving device quality, and income stress in the mass consumer segment have led to increased demand for used smartphones.
Upgrade Cycle: The average smartphone replacement cycle has elongated from 24 months to 36 months, restricting new device sales.
5G Adoption: The price differential between 4G and 5G smartphones has driven consumers to opt for mid-priced used smartphones.
Market Leaders
Apple: Leads the used smartphone market with a 25 percent share, driven by its premium brand positioning and aspirational value.
Xiaomi: Holds the second position, followed by Samsung, with the top three brands accounting for around two-thirds of the market.
Organized Players
Cashify: One of the largest platforms, with over 200 stores in 100 cities.
Yaantra (Flipkart Reset): Focuses on online sales, with offline partnerships with Airtel.
Budlii and Instacash: Other notable players organizing the market.
Insights
Premiumization: Indian consumers aspire to upgrade to mid-premium or premium devices, driving demand for used high-end smartphones.
Rural Expansion: Organized players are expanding to Tier 2 and 3 towns, tapping into untapped markets.
Quality Assurance: Players are building consumer trust through quality assurance and omnichannel presence.
Outlook
India’s used smartphone market is poised for continued growth, driven by affordability, upgrade cycles, and 5G adoption. As organized players expand their reach and improve quality assurance, the market is expected to become increasingly competitive. With 650 million smartphone users and only 46 percent penetration, India remains an attractive market for smartphone ecosystem participants.
India ships around 145-150 million new smartphones per year for the domestic market. There are 650 million smartphone users in India or about 46 percent smartphone penetration in the country.