Africa’s smartphone market declines despite major campaigns in the fourth quarter of 2017

Africa’s smartphone market witnessed a 6.4 percent quarter-on-quarter (QoQ) decline in the fourth quarter of 2017 as its shipments reduced to 20.3 million units for the quarter, announced International Data Corporation (IDC).

According to the reports by the global technology research and consulting firm’s Quarterly-Mobile-Phone Tracker, smartphone shipments were down to 20.3 million units for the quarter, representing an 18.0% Year on year (YoY) decline.

In the feature phone space (a mobile phone that incorporates features such as the ability to access the Internet and store and play music but lacks the advanced functionality of a smartphone), which continually account for a majority share of 62.2 percent of Africa’s mobile phone market, shipments to the continent totalled 33.4 million units signalling a 3.1 percent quarterly decrease.

Feature phones are a go-to phone Africans because it adequately meets their need of making calls without them robbing a bank to do so. With limited purchasing power, they can have access to a reliable long-lasting tool of communication, especially those living in rural areas with limited power supply.

Generally, people go for smartphones because of its advanced functionality. The IDC research also show that 4G phones account for a majority share of the smart phone market at 56.8 percent as shipments of 4G devices were up 3.9% QoQ in Q4 2017, with a drop-in price for entry-level 4G phones and an increase in the number of 4G networks across the continent driving this growth.

However, Nabila Popal, a senior research manager at IDC noted that “Despite the push of operators towards 4G, the price differential between 3G and 4G devices together with the price sensitivity of African consumers means that many people in Africa still prefer 3G phones.”

When the IDC combined smartphones and feature phones overall phone market on the continent, the global technology research and consulting firm noticed that the mobile phone markets saw a 0.7 percent QoQ downturn with its 53.7 million unit’s shipment in the last quarter of 2017.

Continental decline, specific market increase

When it comes to mobile phone space in Africa, Nigeria and South Africa are the two biggest markets. Between Q3 to Q4 of 2017, the two countries witnessed a strong growth as shipments to Nigeria were up by 19.9 percent and 27.0 percent in South Africa.

The reason for the increase in Nigeria and South Africa according to a research manager at IDC, Ramazan Yavuz, is because “major campaigns took place around Black Friday and during the lead up to Christmas, which positively impacted consumer spending in Nigeria and South Africa.”

He added that “while Nigeria continues to recover from recession and consumer spending is on the rise, there are also clear signs of improvement in South Africa. The end to the political crisis means that challenging economic conditions will be addressed as a priority by the new government, which will have a positive effect on consumer confidence and spending on mobile phones.”

Meanwhile, the IDC forecast growth Africa’s overall mobile phone market. Growth for QoQ in Q1 2018 is forecast at 0.7 percent, as overall shipment is expected to increase slightly this year, leading to a 2.0 percent Year on Year growth for 2018. Demand for feature phones is expected to remain strong, although IDC expects vendors to drive smartphone uptake by offering more features in affordable price bands.