Once a new iPhone, iPad or other next generation mobile device hits the market, early adopters, diehard techies, and those who are just looking to upgrade their outdated (and often damaged) gadgets aren’t sure what to do with their old, once-loved predecessors.
They could try selling them online but that means burning a lot of calories taking pictures and writing descriptions only to have to worry about potential spammers and scammers, all to make a couple of bucks. If you’ve ever gone through the hassle, you know exactly what I’m talking about.
They could try re-gifting them to a niece or nephew. Although it won’t help offset the cost of purchasing a new device, doing so could earn them huge karma points and the title of “coolest aunt (or uncle).”
Or, if they’re anything like me, they’ll probably end up throwing them in a junk drawer never to be seen or heard from again. Even though I probably paid a few hundred dollars just a few months ago, overnight the device often becomes more or less worthless. At least that was the case until retailers started to realize the potential size of the secondary market for consumer electronics.
With more than 278 million mobile devices idle or deactivated in the United States (and growing), startups such as Gazelle.com and BuyMyTronics (which was recently acquired by GameStop), as well as traditional brick and mortar retailers such as Best Buy, are hoping to turn old gadgets and gizmos into cash while, at the same time, keeping them out of landfills by redistributing them to consumers both in the U.S. and globally at an affordable price.
“If you assume the average U.S. household has 3 electronic devices, with a population of approximately 300 million, that could mean there are approximately 1 billion devices currently not being used,” says Brett Mosley, founder and CEO of BuyMyTronics. “If the average payback for those devices was only $50 that would equate to approximately $49 billion,” he added. And that’s no small change.
As retailers explore new and different ways to incentivize customers to make a purchase, some are looking to buy-back and trade-in programs as a category expansion. With Best Buy’s Buy Back Program customers can upgrade mobile phones anytime within 2 years of the purchase date. When they do, they receive a Best Buy gift card with a scheduled value to use toward another purchase.
Not to be out done, GameStop has expanded its trade-in program from games to entire gaming systems and mobile devices including iPods and iPads. Since expanding the program in the fall of 2011, more than 3,000 of GameStop’s 6,627 company-operated stores are already selling refurbished iPod, iPhone and iPad devices–an area I’m sure they are only hoping to expand through the BuyMyTronics acquisition. Even though you might not get as much for your devices as you would if you tried to sell them online, there is definitely something to be said for not having to worry about the hassle–to be able to bring your device into a store and receive an immediate appraisal.
Despite a significant uptick in marketing and advertising over the past few years to help better educate consumers about the opportunity to sell their used electronics devices, with millions of devices still sitting around gathering dust, it looks there’s still a lot of work to be done before companies are able to fully realize the market potential for secondary consumer electronics.
Will buy-back and trade-in programs help drive sales for electronics retailers by incentivizing consumers to upgrade to the latest technology? Or will they continue to throw their devices in the junk drawer? Stay tuned.
[Image: Flickr user Nate Bolt]