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The cost of new phones is increasing for many Americans, according to a study

According to an online personal finance platform, the high cost of a new phone is making many consumers decide to wait until next year to upgrade.

In a survey of over 210 respondents using normalized data by age, income, and gender to reflect U.S. demographics it was found that almost two thirds of Americans (63%) would not buy a cell phone in this year due to inflation.

Scott Dylan is the founder of NexaTech Ventures A venture capital company in Manchester, England.

“With phones lasting longer and more affordable options on the market inflation may be accelerating a shift that was already happening — where the days of annual upgrades are becoming a thing of the past.”

Dev Nag CEO and founder QueryPal A chatbot for enterprises based in San Francisco said: “It is important to note, that while inflation might delay purchases for some people, smartphones are essential tools for personal and professional life for many.” This may prompt some consumers to prioritise phone purchases in difficult economic times.

TechNewsWorld reported that “additionally,” the trend to keep phones longer could accelerate due economic pressures. “This may impact the traditional upgrade cycle and revenue models of smartphone manufacturers.”

Inflation Resistant Phones

Rob Enderle is the president and principal analyst of the Enderle Group He told TechNewsWorld that iPhones are sold to non-wealthy groups. Apple’s luxury brand image should have suffered, but not as a result. The impact of inflation on buyers in the middle class and below is much greater than on wealthy consumers.

Ironically while many products have seen their prices rise, the majority of flagship smartphones remain inflation-resistant. Max McCaskill from The Telegraph noted that most of the price hikes were limited to high-end models. WhistleOut Search engine for mobile phone and internet services.

The iPhone 16 maintains the same level of quality and performance as its predecessor. [US]He told TechNewsWorld that the iPhone 12 in 2020 was the first to have a $799 price point. “The $799 launch price of the Samsung Galaxy S24 matched the S21 release price from 2021. Google has been the only company that has bucked this trend, by raising the Pixel’s price consistently for the last two years.

Consumers can be discouraged from buying a phone for reasons other than the inflation rate. Greg Sterling, cofounder of Near Media.

Consumers sometimes take the approach of ‘If it ain’t broke, don’t fix it,'” added WalletHub Chip Lupo is a writer.

My current iPhone 12 works fine. I will use it until the support for it ends.

Reduced Feature Returns

As well, consumers are increasingly using their old phones as new ones. “We have certainly seen replacement cycle lengthen. Ross Rubin is the principal analyst at Reticle Research A consumer technology advisory company in New York City.

He told us that smartphones are now a mature category of devices. Take Apple’s announcement from this week. They continued to advance the platform, but things like the camera control button are probably not going to be something that’s going to spur a lot of people to scream, ‘I have to have this now!’ They continued to advance the platform, but things like the camera control button are probably not going to be something that will cause many people scream “I have to have this now!”

Dylan, NexaTech’s Dylan, added: “We are seeing diminishing returns between model upgrades in terms of significant advances.”

“Consumers are holding onto their devices longer because the improvements — whether in processing power, camera quality, or software — are becoming incremental rather than groundbreaking,” he continued.

Dylan said that the sustainability of products is also beginning to influence purchasing decisions. “Many customers, particularly the younger ones are becoming more conscious of the environmental impact every year,” explained Dylan.

He said that companies are now offering software support for older devices, making it possible for users to use their devices longer without losing functionality.

Self-Worth Phone Link

A survey found that over two fifths of Americans consider a new iPhone to be worth incurring debt. Lupo, WalletHub’s Lupo, was a little confused by this finding. “I am surprised that anyone would think it was okay to take on debt in order to buy an iPhone,” said WalletHub’s Lupo. “You would take on debt to buy a house, or maybe a car, but an iPhone?” “I think two out five is too much.”

“The willingness of consumers to borrow money to buy the new iPhone is a testament to Apple’s marketing and brand strength,” said QueryPal Nag.

He continued, “Apple’s products are now positioned as desirable premium items worth a budget stretch.” This reflects the perceived status and quality of Apple products.

He said that “however,” it also highlighted potential issues with financial literacy of consumers and the power marketing has to influence purchase decisions, sometimes in the best interests of consumers.

A further survey found that 42% Americans feel having the latest iPhones is important to their self-image. Other findings include:

  • Nine out 10 Americans believe iPhones to be overpriced.
  • People who are always in possession of the latest iPhones are viewed as wealthy by 30%, and as wasteful by 27%.
  • Apple is perceived as a monopoly in 65% cases.

Dylan stated that smartphones have become an extension of identity. In many ways, smartphones are not only tools for communication, but also markers of personal taste, success and social currency.

“The technology we have shows others how productive, connected and wealthy we are,” he said.

The culture of upgrading regularly, particularly in the younger generation, is a major factor. Apple and Samsung have done a great job of positioning their products as luxury items, similar to designer clothing or automobiles, making it easier for people to connect their self-image with the phones they use.