If you want to buy a smartphone today, you can get a well-functioning device for little money. But despite falling entry prices, the average sales price has been rising again for several years. Behind this is a clever strategy of the manufacturers.
The smartphone has been told for a number of years. A small rectangle, almost completely covered by the display at the front, surrounded by a metal frame and glass or plastic at the back and a camera bulge with several lenses. And yet camera manufacturers have increasingly managed to drive up the average price of smartphones in recent years. The secret: the newly invented high-price segment, which is still above the premium class.
Apple set the trend again. For the tenth birthday of the iPhone, the group not only presented the traditional iPhone 8, but also the iPhone X, the first model in which the display covered almost the entire front of the smartphone. Apple wasn’t the first to think of that. The idea of being able to offer it even more expensively than the basic models that are already considered premium smartphones – no company had ever thought of that before.
Systematic luxury
With the iPhone 11, it got a system. Since then, the basic iPhone still looks classy, regularly gets a better camera and now and then a new look. But if you really want the latest and best, you have to pay more – and get an iPhone Pro. With an even better camera, smarter screen technology and higher-quality materials. And a significantly higher price. In the meantime, Samsung and others have followed suit and also offer premium smartphones under names such as Pro or Ultra.
With success. While the average smartphone price has continued to fall for many years, it has been climbing again for a few years. There are still tons of cheap models under 200 euros over the counter. They are good as an everyday device, but they are not sexy. However, the average price is slowly rising again. According to Statista, it was EUR 268.89 worldwide in 2017, but last year it reached a new high of EUR 318.62. So almost 20 percent more.
bet on the future
The form factor, which the manufacturers actually hoped would give the market a huge boost, plays a rather minor role: Although foldable smartphones are selling better and better, they are still a long way from replacing the classic smartphone design. In comparison, they are much more exciting. Anyone who has tried one of the devices understands the magic. Whether it’s flipping open a smartphone to reveal a tablet, or folding the full-size smartphone in half for portability, both feel like the future.
At the same time, the models, which are reminiscent of folding cell phones, appear immediately familiar. They can’t be as cool as the Motorola Razr. Still, there’s something unexpectedly satisfying about simply snapping a smartphone shut when a task is done. You’re done and don’t just stray straight back to the next colorful app.
Apparently not too many customers are willing to pay the surcharge that manufacturers such as Samsung or Huawei call for it. According to Samsung, ten million so-called foldables were sold worldwide last year by all manufacturers. For classic smartphones, it was almost 1.5 billion.
The strong cameras of the premium models are more suitable as an incentive to buy. While every economy model now takes decent snapshots, the premium smartphones have long been snapping at the level of good digital cameras. And that even in difficult lighting conditions or moving subjects. Although the most recent leap in smartphone photography was the use of artificial intelligence to improve the images, the better hardware of premium smartphones scores with faster image calculation, more light-sensitive sensors or a telephoto lens. And ultimately with better-looking photos. Apparently that convinces many customers. After all, the best camera is the one you have with you.
Inflation brakes
However, rising inflation could make the strategy more difficult. One example is the iPhone 14. The upgrade was unusually small in the base model this year, but there were real innovations in the two Pro models in particular. So the noble devices should be made more interesting for the customers. However, because the prices of all devices were increased at the same time, this strategy probably backfired in some cases. The price of the iPhone 14 was suddenly on a par with the technically still more attractive Pro model from last year.
The new iPhone 14 Plus, the first basic model with a larger display, was also convincing in the test. But apparently significantly less among the buyers. According to reports, Apple is anything but satisfied with the sales figures, the planning for the iPhone 15 should already be adjusted. The prices at least speak a clear word: While new iPhones usually only become cheaper after months, the iPhone 14 and iPhone 14 Plus have already fallen in price very quickly, they cost ten to 15 percent less. With regard to the premium models, however, Apple’s calculations apparently worked out: They cost almost the same everywhere as when they were launched in September.
Sources: Statista, Idealo, MacRumors
