Smartphone sales dropped by 13% in the second quarter of 2015

Devices from 5 to 5.5 inches represent the largest share of the market

Between April and June 2015, more than 11.3 million smartphones were sold in Brazil – an average of 86 per minute. The volume represents a drop of 13% compared to the same period last year, when more than 13 million smart phones were sold. The data is part of the Mobile Phone Tracker Q2 study, carried out by IDC Brasil, a leader in market intelligence, consulting services and conferences with the Information Technology and Telecommunications industries. Regarding feature phones, the survey shows that there was a drop of 78%, with 936,725 devices sold.

"The problems in the economy, inflation above 9%, the rising unemployment rate and the consumer confidence index, which is at a worse level than during the 2009 crisis, are the factors responsible for the poor performance. In 2015, we will only have the first quarter with high sales", says Leonardo Munin, research analyst at IDC Brasil. According to him, the only positive aspect of the survey is the drop of only 7% in revenue. "This shows that the Brazilian consumer is no longer so sensitive to prices and buys more expensive products as well. Manufacturers are investing and putting better and better devices on the market", completes Munin. However, the analyst at IDC Brasil points out that better smartphones have a longer life cycle, which also impacts sales results.
 
The study also reveals that the stock throughout the production chain, whether of inputs or ready-made devices, has never been as large as in the second quarter of this year. "The high of the dollar forced the market to advance purchases to avoid the transfer of prices. Now, for the market to turn, manufacturers, channel and retailers had to use aggressive price strategies to sell the products. There is no reference of values applied In addition, operators are currently concentrating efforts on renewing their customers' devices, that is, they look at users who purchased smartphones some time ago in their databases and propose updating. If there were no such movement, the drop in sales volume would be even greater", warns the IDC analyst.
 
According to the study, the scenario for the rest of the year should not be different. Only Black Friday and Christmas can give the market some breath. If the dollar remains high, a new price pass-through could happen in the coming months. IDC Brasil expects that 50 million smartphones will be sold by the end of 2015, a number that is 8% lower than the volume sold in 2014. The total market, on the other hand, including the feature and smartphone, should fall by 24%.
 
Trends and other information for the second quarter:
 
– Manufacturers are increasingly investing in dual-sim cell phones with embedded 3G and 4G technologies.
 
– The average ticket of handsets increased by R$ 78.00. It went from R$ 789 (first quarter) to R$ 867 (second quarter).
 
– Phablets, devices with screens over 5.5 inches, accounted for only 3% of sales.
 
– Devices from 5 to 5.5 inches are already the ones that represent the biggest share of the smartphone market.
 
– 34% of handsets sold in the second quarter have 4G technology.