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Asia-Pacific the key market for global smartphone sales

Global smartphone sales grew 5 per cent to hit US$522 billion last year, with Asia-Pacific accounting for nearly half of those.
According to a recent Consumer Life Study by GfK, smartphones, feature phones and wearables accounted for a 44 per cent share of the global $1.2 trillion technical consumer goods (TCG) market. But it warned smartphone sales are expected to grow by just 1 per cent this year.

Apac the key driver
More than 732 million smartphone devices were sold last year. Despite a slight decline in demand, overall consumer spend increased by 5 per cent.
China accounted for 60 per cent of the Apac region’s market value and 54 per cent market volume, making it the largest contributing country to the global smartphone market.
“The Chinese market consumes the majority of the global smartphone production, as well as being the home of local brands that are becoming increasingly global,” observed Alexander Dehmel, GfK regional senior market insights manager.
“Some 40 per cent of the Chinese brands’ smartphone production in 2018 was purchased outside of China, up from 31 per cent in 2016.”
In second position, India bucked the global demand downtrend, reporting growth in both sales volume and value in 2018, by 19 and 21 per cent respectively. More than 161 million smartphones worth more than $28.5 billion were sold last year.
“In Asia’s emerging markets such as India, a country where feature-phone sales still exceeds half of the total handset market, smartphone market rapid growth is fuelled by the high adoption rate of first-time smartphone users, in addition to the fast replacement cycle and upgrading of existing smartphone users,” said Dehmel.

Premium models and Chinese brands fuel growth
Globally, 12 per cent (up from 9 per cent in 2017) of smartphones sold were priced at more than $800 last year. The $150-400 segment continues to be an important competitive battleground accounting for 46 per cent of smartphones sold globally (up 2 per cent from 44 per cent in 2017).
Within Asia, developed markets drove the take up of high-end smartphones. Last year, every other device (53 per cent) sold in these countries cost more than $800. On the other hand, the most affordable phones priced below $150 accounted for half the total market.
“Chinese brands have been significantly increasing their presence worldwide, and specifically in emerging Asian markets, their popularity have been largely driven by their affordability and faster model refresh cycles with improved specs,” commented Dehmel.
“Take the region’s third largest smartphone market of Indonesia for instance; Chinese brands accounted for more than two in every five (42 per cent) smartphones sold in the country in 2018.”

Looking ahead
The study shows that consumer trends are changing when it comes to possessions. Not only do consumers “prefer to own fewer but higher quality items” that they will pay premium prices for, but they also “value experiences more than possessions”. If larger memory or screen size and multiple high-megapixel cameras can enhance their overall usage experience, such innovations will likely help ignite consumers’ imagination and stimulate greater demand.
With rapidly evolving technology, the later part of last year saw new launches in the market which offered consumers features such as larger screen sizes, higher resolutions for both the front and back cameras, along with increased number of camera lens, and more-advanced AI functionalities.
One of the key observations for last year was the continued popularity of larger screen sized smartphones – a trend consistently reflected across every single Apac market. China and Korea were the top two markets where almost nine in 10 smartphones sold had 5.5 inch or larger screen sizes.
“From the trends that emerged in the second half of last year, we anticipate the growth of larger display smartphones with high screen-to-body ratios (i.e. slim bezels) to continue developing this year, as well as rising demand for models with stronger camera offerings in both resolutions (megapixels) and the number of lenses, powered by more advanced AI capable chipsets,” concluded Dehmel.

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