High consumer demand for smartphones and entry level handsets in southeast Asia’s developing markets continue to soar.
In the last 12 months, sales of over 118 million units across the seven key markets in the region including Singapore, Malaysia, Thailand, Indonesia, Vietnam, Cambodia and the Philippines, took the total worth of the mobile phone sector to almost US$137 billion, according to the latest results from GfK Asia.
Consumers in this region bought additional 10 million units of ‘feature phones’ (which have more features than entry level handsets but not as many as smartphones), 12 per cent more than a year ago. However, it is the intensifying popularity of smartphones that is accounting for the larger proportion of the total mobile phone market worth.
GfK says smartphone purchases rose by 78 per cent across the seven countries and now account for over 61 per cent of the sector’s overall value in the region.
“Feature phones still reign as the more prevalent mobile phone type used by consumers in the region’s emerging markets,” observed Gerard Tan, account director for digital technology.
“However, smartphone adoption is escalating at a rapid pace with individual countries’ growth rates reported in the range of 42 to 326 per cent.”
Indonesia, world’s fourth most populous nation, is the region’s largest smartphone market. Its combined feature phone and smartphone volume sales grew by 26 per cent in total, with individual segments reflecting concurrent growth of 19 and 56 per cent respectively.
Although nearly four in every five mobile phones (78 per cent) sold in the country are still feature phones due to their greater affordability, increasing number of consumers there are embracing smartphones, which registered sales of 4.5 million units over the previous year.
The Philippines continues to report exponential three-fold growth of 326 per cent in smartphone volume sales, rendering it the fastest growing market for smartphones in southeast Asia. It is also the country with the highest jump in smartphone market share within a year, from nine per cent to 24 per cent.
“Unlike the more developed countries like Singapore and Malaysia, smartphone sales penetration levels in some of the less developed markets such as Thailand and Vietnam are still relatively low at 19 and 11 per cent respectively, leaving a significant portion of the population still available for potential growth,” noted Tan.
Consumers in southeast Asia spent some US$8.75 billion on almost 29 million smartphones within the last 12 months, translating to 61 and 78 per cent growth in volume and value.
Findings showed that smartphone growth in the region is driven primarily by the more affordable devices priced in the range of US$100 to US$200.
“However, with major manufacturers recently announcing their intentions to launch low-end smartphones priced below US$100, the device will be within the reach of an even larger pool of consumers and the market expected to grow even faster when these models are made widely available,” said Tan.
“This move is likely to significantly expedite the demand surge for smartphones in the region’s yet to be converted feature phone user population which we expect to see continued robust growth for at least the next two years,” he concluded.
GB
