Have we reached peak smartphone, and what does that mean for marketers?

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Kleiner Perkins’ Mary Meeker’s highly anticipated kitchen-sink compendium of third-party stats dropped yesterday. Amidst the barrage of data was the following: global smartphone shipments grew zero percent in 2017. Many others have already pointed to this observation with some mixture of surprise and alarm.

Meeker also cites data that the average selling price of smartphones is declining. That’s largely a function of the need to produce lower-cost devices for developing markets. So does all this mean we’ve reached “peak smartphone?” If so, what does that mean for marketers?

n the US, the Pew Research Center found that 95 percent of US adults now have mobile phones and 77 of those people have smartphones. That leaves roughly 17 percent who have yet to “upgrade.” Most of those people tend to be older (above 50). The smartphone penetration rate is 85 percent and above for those under 49. This data directionally seems to confirm the Meeker observation.The Pew data suggests some growth is possible among older users in the US. However, the most sought-after consumer segments (18- to 49-year-olds) are near saturation. Therefore, the battle there is for “switchers” and upgrades.

A contrasting data point cited by Meeker is that internet penetration has reached about 50 percent of the global population, making growth harder to find. This leads inevitably to a half-empty, half-full interpretation. I would argue that while the remaining opportunity is not 50 percent, it’s also not 10 percent. Accordingly, there is room for new internet users — and the majority of those will likely be smartphone users first and foremost.
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