Consumers are demanding assurances from online trade-ins as more than half expect to upgrade to 5G mobile devices in the next two years, according to new research from Blancco Technology Group.
The Online Device Trade-Ins: Building Trust in an Invisible Process study found 57% of global consumers expect to upgrade to a 5G device in the next 24 months. Of these, almost half (49%) intend to trade in their old device as part of the process.
Blancco says the research demonstrates an opportunity for operators, retailers and OEMs to drive device trade-ins outside traditional retail store walls if consumers can receive the assurances they need.
Following a turbulent year of decreased smartphone sales, industry analysts expect the broader availability of 5G and strong global consumer intent to upgrade to cause a resurgence in smartphone demand. With purchase activity shifting to digital platforms due to pandemic-restricted store operations, the study aimed to explore whether this change in consumer behaviour had also influenced preferences around device trade-ins.
According to the study, while 69% of consumers have never engaged with an online trade-in process, consumers are open to the idea. Forty-one percent said they would be willing to use an online trade-in process in the future, and a further 31% said they would consider it.
However, assurances will be necessary to increase engagement. The findings demonstrate that online device trade-ins can grow if consumer confidence is improved through greater transparency and appropriate data management. Thirty-one percent of consumers said they are concerned about potential data misuse when they trade in a device online and 27% do not trust an invisible, unassisted process.
"The shift in shopping habits, along with the impending 5G smartphone super cycle, is creating a key inflection point for operators, retailers and OEMs to capitalise on their chance to put 5G devices in subscribers hands," says Russ Ernst, executive vice president, products and technology, Blancco.
"Trade-ins will continue to play a key role in incentivising consumers to upgrade by subsidising the costs of new devices, and there is a significant opportunity at play for organisations involved in the collection of used devices to drive revenue through online device trade-ins," he says.
"However, operators, retailers and OEMs will need to build their trust by providing assurances in data protection and device care throughout the customer journey."
The report concludes that the responsibility is on organisations involved in online device collection to provide visibility into every stage of device processing. At the same time, these organisations must mirror the in-store experience digitally and implement best practice data management to protect against personal data lingering on the device.
The report also found that providing consumers a user experience built on assurances in data protection, holistic device care, and sustainable e-waste policies will be essential in driving demand for online trade-ins.
"Online capabilities ultimately help to streamline and strengthen the mobile device trade-in process. They create new customer touchpoints for operators, retailers and OEMs," says Ernst.
"Trading in devices via an online mechanism also enhances customer trade-in experiences and understanding through quick, reliable online solutions that can be accessed anywhere, at any time, from any device," he says.
"The convenience, speed and transparency that online trade-ins can accomplish will ultimately be the driving factor for success."
According to Blanccos global study of 6,000 consumers:
- Of the 32% of respondents who prefer online trade-ins, 62% stated the process is convenient as it is done from home and 51% said it is faster.
- Due to the perceived lack of transparency, data privacy and data misuse is a persistent concern for consumers when trading in a device online. However, this study found that most consumers either already trust or can be persuaded to engage with online, provided they are met with the right kind of reassurances during the process. Only 29% of consumers said they will never trust an online process, no matter the assurances.
- Forty percent of consumers interviewed for this study said they need assurances of a fully recorded process allowing them to track the device step-by-step. Twenty-eight percent want full diagnostics of the device to accurately determine the devices trade-in value, and 25% want more information about where the device goes.