Smartphone unit sales slumped by 7% year on year in the first quarter of 2019, according to new data from market researcher GfK.

But it wasn’t all bad news: the value of the smartphone market actually rose by 3%, to about R8.6-billion, as consumers traded up and bought higher-end models with larger screens.

GfK’s latest point-of-sale tracking data, via its Weekly Monitor, indicates that the consumer technical goods market as a whole grew 1.6% compared to the same quarter in 2018.

“The GfK data shows that high-end devices are now driving the growth of the smartphone market, with average sales prices up 11% year on year for the quarter,” the company said.

The feature phone segment enjoyed a slight resurgence, with unit sales up 4% year on year, while tablet unit sales plunged by about 22%, contributing to an 8% year-on-year fall in IT revenues during the first quarter of 2019.

“The smartphone market showed a marked slowdown in the first quarter of 2019, with fewer than three million units sold,” said Kali Moahloli, commercial head for market insights at GfK South Africa, in a statement.

“Though absolute unit sales numbers are down, the migration of users toward large-screen devices with high-end features has driven revenue growth for smartphone manufacturers and retailers. With smartphones emerging as the primary Internet access device, higher-end consumers are seeking a better user experience for Web browsing, video and other applications.”

Strong start

The consumer electronics market — which includes televisions and audio devices — had a strong start to the year, with revenues growing 6.2% year on year in the first quarter, GfK said.

Panel television unit sales were up 5.7% to more than 275 000 units and market value increased by more than 9%, helped by the 45% growth in unit sales and value for ultra-high-definition TVs. However, sales decelerated in audio home systems, receivers, mini speakers and headphones.

“IT retail had a difficult quarter, with revenues from mobile computer, desktops and storage product all declining. Of the IT categories, only monitors showed significant growth.”

The office equipment market saw a 10% year on year revenue increase, with strong printing device sales boosting the market. There was strong uptake of ink-tank printers.