Covid-19 pandemic spurs smartphone uptake in Africa

Majority of Africans are using the pandemic period to join the digital revolution through smartphones, a research by global provider of market intelligence International Data Corporation (IDC) indicates.

The survey, from IDC's Worldwide Quarterly Mobile Phone Tracker, conducted during the first three months of 2021, reveals that the continent’s purchase of smartphones grew by 16.8 percent from the previous year.

There are now 23.4 million smartphones in Africa, while the overall phone market which includes feature phones rose by 14 per cent to 53.3 million devices.

While the dream to own a smartphone among low-income families was realized, many users also bought feature phones both as primary device and backup phone for mobile money transactions, resulting in an increase of 11.9 percent in simple phones, with their sales hitting 29.9 million pieces.

Affordability

But the jump in sales has been driven by affordability and the necessity to attend Zoom meetings for employees who are now used to working from home, with many users opting to purchase new smartphones for better videoconferencing experience.

"There are a lot of elements at play that are fuelling the smartphone market recovery – pent-up demand, continued supply push on 5G, aggressive promotions, and the popularity of low to mid-priced phones," said Nabila Popal, research director with IDC's Worldwide Mobile Device Trackers.

"Vendors also seem to be better prepared for lockdowns, ensuring they have the right channel set up ready to fulfil orders and reach the end consumer. Lockdowns also have people spending less on areas like leisure, travel, and dining out – and smartphones are benefitting from this. In addition to all these factors, the fast recovery and resilience of the smartphone supply chain also has to be given some credit."

Banking on affordability, Transsion brands, which consist of Tecno, Infinix and Itel tightened their grip on Africa's smartphone space in the first quarter of the year, commanding a combined unit share of 44.3 per cent.

Feature phones

Samsung, which is slowly realising the need to make devices affordable for the African market followed with 22.9 per cent unit share, with Oppo coming third at 8.3 per cent.

Unsurprisingly, Transsion brands are also the leading choice for feature phones across the continent, with a combined unit market share of 78.7 percent, followed by Nokia and Stylo with respective shares of 8.1 percent and 1.7 per cent.

Phones costing less than Sh10,000, according to the report, account for 42 percent of all shipments from January to March, but this was a 7.6 percent decrease from the same period in 2020.

However, smartphones whose price range from Sh10,000 to Sh20,000 saw their market share rise from 35.2 percent last year to 43.3 percent this year.

"The increased specs and attributes in smartphones are driving prices upwards, as evidenced by the growth of the low-end price band," said Taher Abdel-Hameed, a senior research analyst at IDC.

"The main vendors, like Transsion, Samsung, Oppo, and Xiaomi, all launched new feature-rich models in this price band. These models were well received by channels and customers alike, feeding the growth of the low-end price band."

Looking ahead, IDC expects Africa's smartphone market to grow 5.6 percent year-on-year. "Despite supply shortages impacting mobile phone vendors, the major brands succeeded in broadening their model portfolios and driving growth in their shipments into Africa during Q1 2021," explained Ramazan Yavuz, a senior research manager at IDC.

Globally, smartphone vendors shipped over 345 million devices during the quarter.  And while the smartphone market is recovering, a major shift is happening in the competitive landscape.

Huawei is finally out of the Top 5 for the first time in many years, after suffering heavy declines under the increased weight of US sanctions.

International markets

Taking advantage of this are the Chinese vendors Xiaomi, OPPO, and Vivo, which all grew share over last quarter landing them in third, fourth and fifth places globally during the quarter with 14.1 per cent, 10.8 percent, and 10.1 per cent share, respectively.

All three vendors are increasing their focus in international markets where Huawei has grown its share in recent years.

In the low- to mid-priced segment, it is these vendors that are gaining the most from Huawei's decline, while most of the high-end share is going to Apple and Samsung.

Samsung regained the top spot in quarter one of 2021, with impressive shipments of 75.3 million units and 21.8 percent share. The new S21 series did well for Samsung, mainly thanks to a successful pricing strategy shaving off Sh20,000 from last year's flagship launch.

Apple, with continued success of its iPhone 12 series, lost some share from their very strong holiday quarter but still shipped an impressive 55.2 million iPhones grabbing 16.0 percent share, IDC data shows.

Xiaomi, Oppo and Vivo shipped 48.6 million, 37.5 million and 34.9 million phone units respectively, with Xiaomi having the highest rise in global shipments at 64.8 percent.

"While Huawei continues its decline in the smartphone market, we’ve also learned that LG is exiting the market altogether," said Ryan Reith, program vice president with IDC's Worldwide Mobile Device Tracker.

 LG’s exit creates some immediate opportunity for other brands, and with competition being more cutthroat than ever, especially at the low-end phones, up to ten brands are eyeing the share opportunity.

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