U.S. consumers aren’t getting as excited as they used to about buying a new smartphone, Argus Insights contended, and that could mean trouble for handset vendors in a market with an extremely high penetration rate.
It could also lead to underwhelming consumer interest in participating in carriers’ frequent-upgrade programs.
Argus checked more than 622,000 online consumer reviews “scraped” from 14 major websites during January 2014 through June 2015. The sites are AT&T, Amazon, Best Buy, Boost Mobile, CNet, Microsoft Store, Newegg, Sprint, Staples, T-Mobile, U.S. Cellular, Verizon, Virgin Mobile and Walmart.
“New phones are typically a vague improvement on old ones, with better cameras, memory, etc., but these small improvements are failing to create urgency for consumers to upgrade right away,” Argus said. “Smartphone manufacturers have yet to present novel features to greatly improve the consumer experience, and until this happens, consumers continue to flock to iPhones.”
Based on the volume of reviews, Argus postulated an 8 percent drop in smartphone demand in June compared to the year-ago month. The volume of reviews has been a proven indicator of sales and adoption, the company contended.
“The holiday season of 2014 saw extreme smartphone demand, and it will take something truly interesting in a handset to inspire those consumers to ditch their holiday gifts and upgrade early,” the company said. The smartphone market, in fact, “may have reached a point of saturation as consumers are failing to demonstrate the same amount of interest as they were during the same time just last year.”
Perhaps consumers aren’t wowed by smartphones anymore because of their lack of knowledge about what a specific smartphone model can do for them. And that comes down to advertising and promotion. Everyone has seen the Apple commercials and billboards touting the capabilities of the new iPhones’ cameras, but what do other suppliers’ phones offer?
Perhaps some vendors have to promote more, and others have to promote better.
