Smart phones have become a necessity for citizens. However, if you want the most sophisticated smartphone, the price is sometimes out of reach.
In Southeast Asia, citizens of these three countries, namely Indonesia, Vietnam, and the Philippines, are the least able to afford cell phone prices. This is calculated from the average monthly salary in the three countries based on World Bank data as reported by iPrice in their latest research. Indonesia has an average salary of IDR 3.8 million per month, Vietnam IDR 2.7 million, while the Philippines IDR 3.9 million.
As a result, in all three countries, the average price of a mid-range smartphone is twice or more than their monthly salary.
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Even buying a low-end cell phone is a sizeable expense for people in these three countries, costing more than 70% of their average monthly salary.
In all three countries, high-end smartphone models are certainly very unaffordable for most people, as they cost anywhere from 3 to 6 times more than their monthly salary.
Doc iPrice—Graphics of smartphone price affordability in five Southeast Asian countries
The low affordability of smartphones in these three countries is in stark contrast to the Malaysian and Singaporean markets, where low-end smartphones cost only one-third or less of their average monthly salary. While the price of high-end smart phones only costs about 1 month of their salary.
In addition to the salary amount, iPrice also found that the actual prices offered by local online sellers for several brands differed significantly depending on the MRP (Manufacturer’s Retail Price) value. So this also has a considerable influence on the affordability of smartphones.
The data shows the latest iPhone models – iPhone 13, iPhone 13 Pro Max, and iPhone 13 Mini – have consistent prices across all five Southeast Asian markets studied. For this type of smartphone, the average price offered by online sellers only varies by up to 10% between markets.
In contrast, prices for high-end models from Oppo, Vivo and Samsung appear to vary by around 50% between markets, with Indonesia and the Philippines having the largest variation. In fact, we can also see a similar price variation for the 2021 smartphone model.
So, the affordability of this smartphone is actually not only due to the significant difference in the average monthly salary, but also the pricing by online sellers that is adjusted to the strong public demand for certain products.
With conditions like this, it’s no wonder that many consumers sign contracts and pay monthly to telecommunication providers, so that they can take advantage of affordable payment packages for the latest smartphone models.
The payment option “Buy Now, Pay Later” is also one of the choices taken by consumers. (OL-1)