Smartphone Market Drops as Indonesian Consumers are Unwilling to Buy

smartphone market

The Indonesian smartphone market experienced its first decline in 2022 after 13 consecutive years of growth. One reason for the 14.3% decrease was that people are still reluctant to buy new phones.

According to a report by IDC, people’s purchasing power has been affected by inflation, particularly those with middle to low incomes who focus on meeting their primary needs.

In addition, people are said to be redirecting their spending, particularly toward transportation, as mobility increases after the decline of Covid-19 cases.

Another reason for the decline in the domestic smartphone market is due to supply chain issues that affected the sector in the first half of 2022.

IDC also reported that the number of phones shipped last year in Indonesia decreased from 40.9 million units in 2021 to 35 million units last year.

However, in 2023, the Indonesian smartphone market appears to be able to breathe a little easier.

In a positive scenario, Associate Market Analyst IDC Indonesia, Vanessa Aurelia, said that the market could grow by single digits. But this does not mean that people’s purchasing power has returned. Vanessa stated that people are still cautious about spending their income on buying new smartphones.

Vanessa also explained that low-priced phones will also be under pressure as people will spend their money on other sectors.

Meanwhile, some HP vendors are said to be expanding their product portfolios in the high-end segment.

For premium segment phones, she explained that they are expected to be more resilient because consumers tend to own smartphones that are more durable and have better specifications.

On the other hand, smartphone vendors are also focusing on expanding their high-end portfolio.