Stock Smartphone
How fast do you change your smartphone? UAE tech retailers want that to happen with each flagship model launch - and they are hoping the monthly payment schemes will do the convincing. Image Credit: Shutterstock

Dubai: Want to buy the latest smartphone model, but worried about the price? Then UAE’s tech retailers have a solution for you – extended payment plans, typically of 12 months and which could reach all the way to 24 months. Plus, at zero or near-zero interest rates.

As shoppers get more cautious about spending, retailers realise that their best shot at getting to buy is to make the upfront payment as low as possible. Whether it’s the new Samsung Galaxy S22 or the iPhone 13, each model is getting heavy backing through these 12-24 month payment offers.

“There are the diehards who want the latest smartphone immediately after the launch – they will buy at any cost,” said a spokesperson at one of the UAE’s biggest online tech portals. “But it’s the shoppers who come after who will be most conscious about pricing – this is why we need the extended payment plans. These days, more of them are buying this way.”

On the Samsung S22 Ultra costing Dh4,699, for instance, the deal on offer works out to a Dh196 monthly payment at 0 per cent interest. Sharaf DG is running instalment plans for Dh151-Dh198 a month on the new iPhone 13.

According to Rajat Asthana, Head of Sales at Eros Group, “Rather than straight discounts, the current deals are built on flexible payments, extended warranty and add-ons. We had a few good weeks with the new Samsung S22 – but we have run out of some models and these need replenishing.

Stock - Rajat Asthana from Eros group
Rajat Asthana of Eros group said: “Samsung and Apple represent 80-85 per cent of the UAE’s mobile sales in value terms. When it comes to other brands such as Huawei, the supply situation is better.”
Laptops and tablets
Demand for these product types has slipped from the time when work/study from home was a priority. Even then, there are supply shortages being felt here too.

“The pricing has been stable for laptops after the increases that happened in the last two years,” said Rajat Asthana of Eros. “Where the UAE market is seeing growth is in sales of gaming laptops, which has emerged as a new segment driving the overall PC market. More and more consumers are taking to gaming as a major activity and there is also a massive interest from the younger generation. Such consumers are looking to up their gaming experience with special laptops and monitors.”

Supply delays

Shipment problems have been a running issue in the UAE’s electronics and tech gadget space since the beginning of 2021. The global shortage in chips that power these gadgets was what set off the problem initially, and then came the supply issues created by the COVID-19 situation.

The biggest impact of this has been felt on white goods and home appliances, with higher freight costs pushing up retail prices by 15-20 per cent in recent months. On televisions, it was felt that chip shortages would affect their prices as well – “But what we have seen is there was a subsequent drop in panel costs, which make up 60-70 per cent of a TV’s retail pricing,” said Asthana. “When that went down, TV prices did not rise as high as white goods did.”

Holding the price line

With smartphones, latest model launches have seen stable prices compared with those of the last two years. “The only concern that’s left with smartphone sales is the erratic supply of new stocks,” said Asthana. “We have been told that the situation will improve only by end July or August.”

By then, UAE consumers will be ready for the next round of smartphone launches…

Will bundling win in the 5G game?
Latest smartphone launches are getting closer to realising the 5G vision for UAE’s telcos, both of whom have confirmed their 5G subscriptions are growing by the quarter.

e& (which is the Etisalat Group’s new identity) and du have also been price aggressive in backing up latest smartphone launches with data package bundles. Plus, they are also offering payment plans on the models that are on par with what is available from retailers. So, have these offers weaned away customers from traditional tech retailers?

“What we can see is that 80-90 per cent of new handset launches are still taking place at retailers, offline and online,” said Rajat Asthana of Eros Group. “UAE consumers by and large are sill buying the handset and data packages separately.

“Whether more 5G adoption will get users to choose telco provided packages is something we will look at closely.”