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Australian smartphone and smartwatch sales on the rise and so are mobile payments

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Australian smartphone sales grew in 2017 with year-on-year figures showing an 11 per cent increase for a total of 9.2 million units and taking the total number of smartphone users to more than 19.3 million, according to figures from Telsyte. 

Smartwatch sales also increased and for the first time have overtaken smart wristband sales.

And it’s no surprise to hear mobile payments are also growing in Australia.

The Telsyte Australian Smartphone and Wearables Devices Market Study 2018 shows 4.8 million smartphones were sold in the second half of 2017 which is up 6 per cent from the second half of 2016.

Android devices make up 55.1 per cent of all units sold while while the iPhone occupies 44.7 per cent of the Australian market.

According to Telsyte, the iPhone X didn’t deliver significant additional sales in Australia due to its high price and relatively short time in market in 2017.

But the iPhone 8, iPhone 8 Plus and iPhone 7 were the most popular models in the second half of 2017.

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Another thing that has increased is the average cost of a smartphone in Australia.

Since 2015 prices have risen by more than 30 per set with the main reason being customers looking for models which include more internal storage.

In fact, internal storage is now ranked as the fourth most important feature when deciding on a smartphone, up from sixth in 2016.

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And as a result of this price increase the average replacement cycle is now moving to three years rather than the previous two years.

Even though iPhone sales remain steady in the second half of 2017, Apple maintained the highest repeat purchase rate of any brand in Australia.

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Of those who used an iPhone and purchase a replacement in the second half of last year, around 85 per cent chose to buy another iPhone.

The next highest brand was Samsung which had a 70 per cent repeat purchase rate.

For the first time, the sales of smartwatches have eclipsed smartbands with a total market of more than 844,000 devices sold in the second half of 2017.

Smartband sales actually declined year-on-year by more than 30 per cent.

But the six month sales of smartwatches grew by 29 per cent compared to the second half of 2016 with health and fitness features on smartwatches accounting for the decline of less capable wristbands.

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Almost three quarters of smartwatches sold in the last six months of 2017 were Apple Watches, a total of more than 360,000.
Telsyte puts this increase down to the release of Apple Watch Series 3 which now includes a cellular model that can connect independently to mobile networks.

The research shows almost 30 per cent of all Australians are showing interest in smartwatches that have that built-in mobile connectivity.

Apple exceeded one million Apple Watch users in late 2017. Apple and Fitbit are the market leaders in the smartwatch and fitness band markets.

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With even more smartphone and smartwatch users, it’s no surprise that mobile payments are also growing in Australia.

Telstye’s report shows one in seven (14 per cent) have completed a mobile contactless payment transaction at a payment terminal in a store at least once. That’s an increase from 8 per cent in 2016.

It is this increasing adoption of mobile payments that is beginning to influence Australians’ banking decisions.

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Whether a bank offers Apple Pay has the most potential to influence our banking choice despite Android Pay being more widely supported by the major banks in Australia.

From these figures it is obvious that Australians are more loyal to their smartphone platform –  iOS or Android – that they are to a bank with many willing to change to be able to use Apple Pay.

More than half of Apple Watch users in Australia can’t use Apple Pay with their primary bank and this is resulting in customers turning their backs on their financial institutions.

About one in five (22 per cent) iPhone users said they be more likely to bank with a provider if it supports Apple Pay with that figure increasing to 32 per cent for those who are also using an Apple Watch.