Analysts already see the light at the end of the tunnel for the European mobile market, including Spain, and estimate that it will grow again in 2024 or even earlier. The comeback is expected to be a relief after 2 and a half years of selling less and less, and these are its main causes.
Mobile phone manufacturers have been wandering in the desert for a long time since since the end of 2021 their sales began to drop in Spain and in the rest of the world market. From then until today, mobile phone sales have only declined.
Despite the negative of the current trend, which has not softened in the first quarter of 2023, quite the contrary, analysts are finally finding reasons for optimism in the short term.
At the end of 2023 or next year 2024 will be the time when mobile sales return to growth in the Spanish market and the rest of Europe after what could be 2 and a half years of negative results, as IDC and Canalys, 2 of the main analysis firms, agree.
This has been the volume of the market that mobile manufacturers have left by the wayside so far and the reasons that according to experts justify the return of growth.
The collapse of the mobile market, in figures
The mobile market is said to be falling, but how big has this slump been since it started back in the second half of 2021?
ComputerHoy has analyzed the number of mobile phones that have been marketed in the world since the market began to fall so that you can see the drift that has followed.
Worldwide, 347.7 million smartphones were sold in the first quarter of 2021, a time of skyrocketing for the industry just after the COVID-19 pandemic hit.
If we take into account that in the same period of 2023, only 269.8 million mobile phones were sold, we can see that the market has lost 22.4% in volume in just 2 years. Or put another way: there are almost 78 million fewer units sold per quarter.
Mobile sales in Spain 2020-23
Canalys
And in Spain the outlook is not exactly improving.
In the first quarter of 2023, less than 3 million smartphones were sold in Spain, 14% less than the same period of the previous year. It is about 1 million units per quarter less than in 2021.
Market recovery is just around the corner
Despite the bad trend, analysts finally place in their short-term forecasts that the market will return to growth figures. In this sense, the projections of IDC and Canalys differ slightly.
On the one hand, Canalys believes that the Western European smartphone market will continue in a downward trend this year 2023, reaching 9% in the case of Spain but in 2024 there will finally be a rebound with a growth of 6%, although in Spain it will be 5%.
“The low demand comes mainly from consumers who are extending the useful life of their mobiles. If before, for example, a device was used for 2 years, now it can last between 2.5 and 3.5 years. The increase contributes to this of buying high-end mobile phones,” explains Runar Bjørhovde, an analyst at Canalys.
Selling more is not always the most profitable: do you know how many mobiles are bought per day?
On the other hand, IDC points out that recent market symptoms suggest that at the end of this 2023 more smartphones will begin to be sold That the last year.
“Although we are optimistic about the recovery at the end of the year, we still have a difficult 3-6 months ahead of us,” says Nabila Popal, research director of IDC’s international Tracker.
“IDC hopes that the market enters positive territory in the third quarter and record double-digit growth in the holiday quarter,” adds the expert.
The reasons for the trend change
©adrianhancu/123RF.COM
After reaching the lowest levels in the last decade, the mobile market in Spain will soon return to positive numbers for various reasons, as highlighted by analysts.
One of these reasons has to do with telephone operators, who once sold most mobile phones in Spain directly through their rates, and which are once again gaining importance after the pandemic hit.
“The recent economic situation has allowed the operators recover channel share up to just over 50%recovering from a pandemic-induced slump,” according to Runar Bjørhovde.
And what is the reason for this renaissance of operators as kings of mobile sales? That more and more expensive mobile phones are being bought has a lot to do with it.
“This revival is largely due to attractive financing plans and combined offers adapted to a market increasingly interested in upper-middle-range devices,” says the Canalys analyst.
Another reason that allows sales to return to healthy levels for the market has to do with the recent drop in sales, which has helped manufacturers to better take the pulse of the market and do not manufacture more to avoid suffering from excess inventory.
“Everyone is anxious to know exactly when the trend will turn and wants to be the first to ride the wave of recovery. But it’s a tricky situation. Anyone who jumps in too early will drown in excess inventory. Now more than ever, it is important to keep the pulse of the market”, points out Nabila Popal.
And the last reason, quite obvious, has to do with the time that smartphones usually last, which is limited. Therefore, it is logical to expect that users whose mobile stops working or runs out of support buy another, since today it is still an indispensable device.
“Many of the mobiles that are currently used in Spain were purchased between 2020 and 2021periods of very strong demand, and these devices will have to be renewed in 2024. This is particularly the case for devices that cost less than 400 euros, which constitute a significant part of the Spanish market,” Bjørhovde adds.
