As India’s refurbished gadget market matures, Cashify’s Nakul Kumar explores the industry’s growth drivers, challenges, and the evolving consumer mindset shaping this re-commerce sector like never before. Edited excerpts from my interview follows:
The refurbished market has always been predominated by unorganised players like local stores and websites where you can buy and sell things. They had introduced people to the value that pre-owned phones hold. The only gaps that the unorganised market had were a lack of warranties, refunds, or replacements. We, as organised players, are adding more structure to the market. We are helping bridge the gaps by improving the quality of gadgets and providing warranty, financing options and after-sale support. As a result, the trust in the segment is growing, further boosting the market. The segment has noticed a consistent growth of over 10% yearly since the pandemic. Increasing environmental consciousness is another factor encouraging people to make eco-friendly choices. As more and more upgrade to smartphones, the trend line will keep going up.
Driven by a large, price-sensitive consumer base, focusing on affordability, it is safe to say that India is a bigger market for refurbished goods than the western counterparts.
Also read: India’s refurbished smartphone market booming: Flipkart’s Recommerce Business Head
However, the market in India is less mature than that of the US and Europe. Consumer behaviour is largely different, with the US and Europe having a longer history of acceptance and education regarding refurbished products. The presence of strong policies and laws empowers the organised market, ensuring high quality and consumer protection. In contrast, India is yet to intensify its focus on these aspects.
On the other hand, much like the Western markets, India is also noticing a growth in consumer awareness and acceptance of refurbished products, driven by environmental concerns and the appeal of cost-effectiveness. Enhanced refurbishment processes and warranties are also playing a major role in improving the consumer trust globally.
Honestly, the refurbished world is clouded with doubts. As leaders of the organised market, it is our responsibility to structure our refurbishment process in a way that aids in building trust for refurbished gadgets. To ensure that only top-quality products leave our warehouse, we have a lineup of processes in place.
First is, every gadget is put through a rigorous 32-point quality check. Only the gadgets that pass this stringent inspection are certified as refurbished. To provide further clarity to the end-user, we grade devices as Superb, Good or Fair, based on their condition.
Data security is another top priority. We have tools that help us ensure that all phone data is irretrievably erased before resale.
Partnerships with reputable brands and retailers ensure a steady supply of high-quality gadgets for refurbishment and resale, further enhancing trust in the market.
Also read: ReFit Global on India’s gadget refurbishment market – Myths, Insights, and more!
Every phone comes with a comprehensive device report, a 6 or 12 month warranty, and a 15-day return policy. These help us foster consumer confidence. Moreover, with nearly 200 stores pan India, customers know that they can reach online as well as offline.
The biggest challenge is the uncertainty that people harbour about refurbished phones. The uncertainty is majorly due to insufficient awareness about the category. In one of our surveys, 2 in 5 respondents who claimed to know about refurbished phones didn’t understand the term correctly. While this knowledge gap is gradually closing, there is still much work to be done.
AI will be a game-changer in the market. Insights from our device diagnostics SaaS tells that most people are unable to share the accurate condition of their old phones – a requirement that’s paramount in deciding a phone’s buyback price. We’re building a device that auto-accesses a device’s condition, helping suggest the most-accurate and best offer price for their old phones. This will help us analyse a device’s condition most accurately, further helping provide better prices to our customers.
In itself, the refurbished segment is an opportunity to make technology available and affordable for all. We’re leveraging this by delivering value to the customer. We refurbish and add value to older devices, providing customers with phones that perform like new at a fraction of the cost. As 5G rolls out and new models launch rapidly, upgrade cycles are shortening. But it doesn’t mean that everyone will be able to afford a new phone. That’s where refurbished comes in. This is creating room and demand for older models, allowing us to reintroduce them in the market as refurbished.
Consumer mindset towards refurbished gadgets in India is evolving positively. Initially, there was significant scepticism regarding the quality and reliability of refurbished devices. There still is, but has narrowed down quite a lot. However, with increased awareness and education about the benefits of refurbished gadgets, consumers are becoming more open to these options. The aspiration to own a premium smartphone at up to 40% less is definitely a major push.
People’s main concerns about pre-owned devices are device quality and the unavailability of a warranty or refund policy. We ensure transparent communication about what is refurbished and provide comprehensive device reports detailing the condition and any repairs made. This transparency helps alleviate fears and reinforces the reliability of our products. To further build trust, we offer a hassle-free warranty-claim process available pan-India, which can be accessed online or at any Cashify store. These initiatives ensure consumers receive true value for their money and help shift the perception of refurbished gadgets.
Customer service and after-sales support are crucial for building trust, especially in the refurbished gadgets market. Our consumer surveys show that many prefer the unorganised market for its direct, in-person support. To address this, Cashify’s nearly 200-store network provides convenient, face-to-face assistance. We also offer comprehensive 6 to 12-month warranties and a 15-day return policy to boost confidence in product quality. Transparency in our claim process and responsive customer support further enhance trust, ensuring customers feel supported throughout their purchase journey. These efforts collectively reassure buyers of reliable products and dependable service.
We’re looking at a vibrantly growing market ahead. Predictions are that the market will double to $10 billion by 2030. The entry of newer players in the organised market is helping the category boom. But there’s still a lot of untapped potential. As more and more players enter the organised market, consumer base and trust grows and the market, which is predicted to boom by 2030, might boom sooner.
Also read: Flipkart’s refurbished phone business: Buying and selling of used phones explained
