Why are more and more people buying premium phones?

Smartphones vary in price.From budget phones to flagships, there's something for everyone.However, despite the vastly enhanced capabilities of budget phones over the past few years, reports show that today, more people are willing to buy high-end phones.

Why is this?Are premium phones really more cost-effective?

High-end mobile phone sales on the rise

Before we dive into the reasons why more and more people are buying high-end phones, let's take a look at some supporting statistics to get a better perspective.Note that when we say premium phones here, we mean phones over $400.

In the image above representing Counterpoint's research, we can see that over a quarter of all smartphone sales in 2021 will be premium smartphones.Given the increasing sales contribution of premium phones from 2016 to 2021, we can safely assume that this trend is likely to continue into 2022 and beyond.

Unsurprisingly, the majority of the premium smartphone market is captured by Apple. The tech giant captures a whopping 2021% of the market in 60, and we're guessing Apple's recent success in Asia has played a big role in that victory.In the chart after Apple, Samsung has 17%, Huawei 6%, then Xiaomi, Oppo, Vivo and others.

Next, let's move on to see why today's buyers may be more willing to buy a high-end phone than a budget or mid-range phone.

1. High-end phones are more economical in the long run

Granted, premium phones are expensive and aren't for everyone.But there are ways to justify them being more economical than cheaper phones.The three main reasons people upgrade their phones are because the battery has degraded, software support has ended, or they just want new features.

Knowing this, a high-end phone is a better choice for you under three conditions:

1. You are willing to carry your phone with you for more than three years.

2. You don't care much about having the latest software updates.

3. Once the battery performance deteriorates, you can replace it.

Assuming you buy a cheap pair of headphones every year, even if the headphones are new, you'll still get terrible sound quality every time because the components inside are simply inferior.But if you switch to high-end headphones, you can enjoy great sound quality for a few years with just one pair.

The same is true for smartphones.If you buy a budget phone every two to three years, you'll get average performance, camera, and build quality every time.However, if you buy a premium phone, you can enjoy its premium hardware and software for longer, provided you have no problem with the three conditions we mentioned above.

Battery replacements can cost anywhere from $25 to $100, so you're actually saving money in the long run by not buying a new phone.

2. Mobile gaming is expected to explode

Mobile games have a bad reputation among the gaming industry and players.After all, most mobile games feel like they're there to help you pass the time, not immerse you in the story or the game.Think Candy Crushers or Subway Surfers.This is one of the biggest reasons why mobile gaming still sucks compared to console/PC gaming.

Fortunately, this situation is changing for the better.Experts believe that mobile gaming will see explosive growth in the next few years.After all, there are far more smartphones in the world than game consoles and computers.Mobile gaming enables developers to reach a larger audience, which helps generate greater revenue through microtransactions.

Also, as phones become more powerful and 5G spreads year by year, the graphics and multiplayer experience will also improve.All of this will translate into developers making better mobile games, and in order to play those games, buyers will be more likely to buy premium phones with better performance.

3. There are more options

As we can see in the chart, Xiaomi, Vivo, and Oppo now offer competitive flagships that go head-to-head with their Samsung counterparts, with impressive specs, great build quality, and plenty of cool factor .

Apart from OnePlus, Chinese brands are not prevalent in the US, but they have a strong grasp on the Asian market.As such, they may downplay their budget phones and prioritize marketing their flagships to increase sales of the latter.

4. Buyers are more informed

Unlike buyers of the past decade, today’s buyers are more informed, informed and outspoken about their needs.With more options than ever, they are free to choose.

And, with the rise of new content creators and tech publications, buyers can easily watch videos or read articles to compare two or more phones they like and make better buying decisions.

All this is not surprising.As society becomes more technologically advanced and we rely more and more on smart gadgets in our daily activities, people will naturally be more willing to spend more on said gadgets than just smartphones.Yes, budget phones have gotten really good, but there are some features that are unique to premium phones.

High-end mobile phones are becoming more and more popular

Most smartphone sales include budget and mid-range phones, as most of what the average buyer needs can be easily found in that price range.However, for all of the above reasons, buyers around the world are increasingly willing to pay more for the affordable high-end or "flagship killer" experience that the tech industry has been obsessed with lately.