Ever wonder what happens to your phone once you turn it in for an upgrade? Well in Samsung’s (OTC:SSNLF) case, it plans to refurbish its higher end models and resell them in other markets.
The company isn’t the first to do so – Apple already does this too – and there are concerns about it eating into sales of its mid-tier products. But that doesn’t mean it shouldn’t be done.
Speaking on cannibalizing its own sales, the late-Steve Jobs used to say something along the lines of, “If we don’t do it, someone else will.” That’s exactly the case with Samsung in this situation. If they don’t take market share in emerging markets like India, which has a population of more than 1 billion people, then someone else will instead.
And right now, it’s hard to bet against Samsung. The stock is up more than 30% on the year and hitting record highs, and has done pretty well selling into India. Samsung sales in the country are up 15% year-over-year and ~11% quarter-on-quarter. Not to mention, India’s smartphone market is growing about five times faster than the rest of the globe.
Plus, by getting its higher quality devices in users’ hands, it will (hopefully) lock them into a more engaging ecosystem and keep them around for future generations.
