Smartphone trade-ins in South Africa — Oppo, Xiaomi, Huawei need to step up

Cellucity CEO Sean Joffe has said that Samsung’s competitors in South Africa will have to respond to the electronics giant’s aggressive smartphone trade-in promotion launched with the Galaxy S22 series.

“OEMs like Oppo, Xiaomi, Huawei will need to formulate a trade-in reply to remain relevant at the higher end of the market because this landscape has now changed forever,” Joffe told MyBroadband.

When upgrading your smartphone, trading in your old device is an effective way to make new and expensive phones affordable.

Trade-in deals are now common practice among cellular retailers in South Africa.

However, Joffe explained that this hasn’t always been the case.

“It has taken Cellucity almost three years to get any meaningful traction with trade-ins,” he said.

“But as the Trade-in values for these devices have risen in conjunction with new product launches with greater support from the OEMs, the adoption rates have climbed significantly,”

The time it took for trade-ins to become more commonplace was due to the belief that South Africa was a hand-me-down market.

Joffe said this view has well and truly ended with the recent Samsung Galaxy S22 trade-in campaign, which saw nearly twice the engagement than the Galaxy S21’s did.

Samsung’s campaign lets you trade in selected previous-generation flagship smartphones and get R10,000 off the price of a Galaxy S22 smartphone.

Cellucity is a Samsung partner for the campaign.

“When planning the programme, we knew that there would be a growth of trade-in customers and expected this to be approximately 120%. We never expected 3,200%!” Samsung South Africa’s integrated mobility director Justin Hume told MyBroadband.

Everyshop is also one of the retailers capitalising on trade-ins and has found great success with the service.

“Trade-ins are a big focus as part of our overall strategy. Not only does this provide more affordability on new devices to consumers, but it encourages a responsible way to dispose of old tech,” Everyshop marketing executive Stef Michael told MyBroadband.

If phone trade-ins have become a significant part of regular business for new phone launches, it raises the question of what happens to the old phones.

Old phones are graded and then distributed based on their model and quality after being traded in.

“Typically, A-grade devices might be resold in South Africa. However, A-grade devices make up a very small proportion of the overall volume. The balance will be sent overseas where they will be re-sorted and reconditioned for sale into other markets,” said Joffe.

This practice has proven so successful that Everyshop has also expanded trade-ins to products other than smartphones.

“In our business, we have extended trade-ins beyond just cellular and now also include laptops and other selected tech. We work with various partners to recycle, resell or donate products post-trade-in,” said Michael.

Trade-ins offer an effective way of disposing of old tech safely, providing substantial discounts for consumers, and ensuring that the market won’t run short of lower-end phones.

It’s not surprising that it has become an important part of the market, stated Joffe.

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