Smartphone Prices Drop Over 50% In Nigeria - Sundiata Tech

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Wednesday, April 4, 2018

Smartphone Prices Drop Over 50% In Nigeria

Data from an annual mobile report by Jumia, one of Nigeria’s biggest e-commerce sellers, show that prices of smartphones sold on its marketplace platform dropped by more than 50 percent to around $100 in the last three years.
The lower prices have predictably been a boon for sales, as Jumia says its smartphone sales increased by 70 percent in 2017. Despite the fall in prices though, $100 smartphones remain out of reach for some Nigerians as it comes to double to current monthly minimum wage.
Jumia attributes the fall in prices to the “Africa-specific strategy” of Asian brands, which produce and sell cheaper smartphones in Africa’s largest market.
At the turn of the decade, Asian production of smartphones first started with knock-off versions of well-known brands, but, over time, some Asian brands have since evolved to become more distinctive and sophisticated while being priced at much lower price points than top brands like Apple and Samsung. As a result, these more affordable brands have become more appealing to Nigeria’s middle-class buyers.
The most successful with this strategy is China’s Transsion Holdings, which holds popular brands including Tecno, Infinix – among the top sellers on Jumia and Itel.
The company has long focused on an Africa-first strategy with its products, and it is now reaping the rewards across the continent. Last year, Transsion’s brands combined for a 32 percent share of smartphone shipments in Nigeria – up from 25 percent in 2016. In comparison, despite still being the market leader, Samsung’s share dipped to 34 percent.
Nigeria remains Africa’s largest mobile market, with about 162 million subscribers and a penetration rate of 84 percent.
The number of internet users fell in 2017 as consumers responded to a poor economic climate, adopted other OTT channels for voice and data services, and as regulatory measures continued to oblige operators to disconnect unregistered SIM cards.
Despite these setbacks, four key growth drivers enhanced the adoption of smartphones in Nigeria and Africa: First, the multiplicity of affordable smartphones and a growing market for second-hand devices played a major role in driving the country’s e-commerce sector, which is estimated to be worth $13 billion by 2018.
The third lever is the multiplication of easy payment options such as credit or debit cards payment, or even cash on delivery; and the fourth is the increasing use of social media sites (active social media users).

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