1. Improved understanding of consumers purchase intention towards refurbished smartphones
2.How to build and increase trust towards renewed/ refurbished devices
Refurbished smartphones - Building trust and consumers purchase intention
1. 1. Improved understanding of consumers purchase intention towards refurbished smartphones
2. How to build and increase trust towards renewed/ refurbished devices
3. How to build a brand for 32Checks
OBJECTIVES
Individual differences of consumers
(e.g., involvement, product class knowledge, innovativeness)
Framework
Used
2. ORIENTATION PHASE: BARRIERS
Many consumers are currently
unaware that refurbished
smartphones are available. If it
is not available in their familiar
retail channels, potential
consumers may miss the
opportunity altogether.
Only 79% of consumers are
aware that there is something
called refurbished
smartphones
Many customers don’t
understand what refurbished
devices mean. They club
refurbished and open box
smartphones in same category
as a regular second hand used
phone.
In a survey conducted, 30% of
consumers aware about
refurbished products thought
they were defective or of
inferior quality
People look forward to
verified sources/vendor to
purchase high cost products
that are reliable.
Presently market is
fragmented, unorganized & is
lacking credible players
Because of lack of reliable
players in all the markets
consumers are hesitant to buy
refurbished smartphones
Lack of enjoyment related to the
purchase of a new product, can be a
reason to reject a refurbished
product in an early stage.
One respondent said “it is boring to
purchase smartphones but the
pleasure of newness is great”.
Also, social stigma still exists with
majority of millennials as they
perceive them to be inferior
LACK OF
AWARENESS
MISCONCEPTION
ABOUT REFURBISHED
LACK OF
AVAILABILITY
LACK OF THRILL
OF NEWNESS
3. EVALUATION PHASE: RISKS
• Firstly, refurbished smartphones trigger a
perceived performance risk, which may
hinder their adoption. Due to uncertainty
about the use history and refurbishing
process and the fact that refurbished
Smartphones are typically older, potential
consumers may fear that a refurbished
smartphone will not perform as well as a new
one.
• Refurbished products may also provide a
financial risk. If a refurbished smartphone
falls short of expectations, consumers will
experience this as a financial loss
RISKS
53% of consumers perceive buying refurbished products as risky
4. EVALUATION PHASE: BENEFITS
• Firstly, a refurbished smartphone offers financial benefits because of the lower price and
same quality as a new phone
• Secondly, refurbished smartphones offer environmental benefits. These benefits are largely
unknown to consumers, as refurbished smartphones are currently marketed mostly from a
cost-savings perspective. Making environmental benefits more salient may alter the
perception of refurbished products, and increase adoption
Benefits
BENEFITS RISKS
• Performance Risk
• Financial Risk
• Time Risk
• Obsolescence Risk
Financial Benefit •
Environmental Benefits •
Unique Product Features •
Higher Performance than 2nd Hand phones •
5.
6. SOME AFTER SALES REVIEWS BY THE
CUSTOMERS
• Some of the best products sold by 32Checks: Asus max pro 2, Mi Redmi Note 6
• People have started to trust them and they are one of the fastest selling products.
7. • While Samsung Galaxy A20 on the other hand mostly negative reviews like - they were clearly
cheated with fake or non-refurbished 2nd hand product with bad packaging, we have to
look into how this delivery was handled and improve the accountability
• And on another model same phone has two extreme reviews clearly showing difference
between someone who understands refurbed and non refurbed phones.
8. CUSTOMER SEGMENTS
• Casual Supporter - “I like sustainable products, but I see my smartphone
mostly as a tool”
• Casual Supporters have a high environmental consciousness when compared to
others. They see it more as a utilitarian tool than a status symbol or extension of
their personality. Their lower involvement in smartphones goes along with a low
level of innovativeness and thus conservative purchase behavior.
• Casual supporters do not need the newest technology to be satisfied with their
smartphone. Their level of knowledge about smartphones is also low when
compared to other groups, but they do want to have good value for their
money
• Because Casual Supporters are more focused on the smartphone’s primary
utility, they are more likely to accept devices that are not new.
• Casual Supporter is strongly influenced by the product-related incentives of an
upgraded battery, guaranteed software updates and an upgraded
performance.
• According to the offline dealers most of these purchases are made by people
who are on the move constantly. They need a utility phone, quick and easy to
use with most features a new phone gives at cheaper rate.
9. CUSTOMER SEGMENTS
• Sustainability Enthusiast - “I happily pay the price for any sustainable
alternative”
• They have a strong environmental consciousness and thus the highest motivation
to use sustainable products. They are relatively conservative when it comes to
purchasing smartphones and do not desire the newest features. Price is less
important to the Sustainability Enthusiast.
• They prefer smartphones with standard features and they are driven by
sustainable motives, the proposition of a refurbished smartphone is appealing to
them.
• The purchase intention of Sustainability Enthusiasts is influenced most by the
product-related incentives of an upgraded battery, and an upgraded
performance. Furthermore, this customer group is less influenced by a
classification system
10. CUSTOMER SEGMENTS
Conservative Critic - “I’m not fully convinced by sustainable electronics”
• They do not have a strong desire to use sustainable products. Conservative
Critics do not use smartphones to communicate their identity, and care little
about others’ opinions. They are significantly older than the other customer
groups.
• Conservative Critics have a relatively negative attitude towards the proposition
of refurbished smartphones. Specifically, they perceive fewer financial and
environmental benefits.
• Persuading the Conservative Critic to purchase a refurbished smartphone will be
challenging. Specifically, though the incentives related to a better performance
(through updates, battery, and speed) are among the most influential incentives
for Conservative Critics, their impact is lower than that for other groups..
11. CUSTOMER SEGMENTS
Susceptible Follower - ““I want a smartphone that expresses who I am”
• They have relatively high scores for both the value-expressive and social-
adjustive functions of smartphones. They are looking for a smartphone that fits
their personality and find it important that others value the smartphone they
possess.
• Although Susceptible Followers are environmentally conscious, they are
generally unfamiliar with the concept of refurbished smartphones and have a
low purchase intention.
• Next to the generally preferred incentives of an upgraded battery, guaranteed
software updates, and an upgraded performance, Susceptible Followers
respond positively to an updated camera and an updated appearance. A
smartphone’s appearance can reflect the personality of the owner, and if the
appearance is updated and unique, it is more appealing. Being unfamiliar with
refurbishing, acquiring more information on the process will also increase their
purchase intention.
12. CUSTOMER SEGMENTS
Proud Power-User - “I select my smartphone based on both performance and symbolism”
• Proud Power-Users can be considered an ‘expert’ customer group.
• They tend to buy the latest available technology before others do. Price
is an important factor in making a purchase decision.
• Proud Power-Users do not like to settle for last year’s model. Hence, they
perceive higher performance and financial risks in refurbished
smartphones.
• Proud Power-Users should be incentivized by product-related incentives
(e.g., software updates, upgraded battery, overall speed, screen quality,
picture quality, and innovative features, upgraded or better version of OS,
removal of bloatware) because these would enable them to acquire a
smartphone that provides high-quality performance and possesses the
latest technology, despite being refurbished.
13. CUSTOMER SEGMENTS
Expert Techie - “I set high demands for the smartphone I use”
• They are also involved in and knowledgeable about smartphones and like to
have the latest technology. Contrary to the Proud Power-User, the smartphone
does not necessarily reflect their personality and they are not influenced by
peers (low value- expressive and social-adjustive functions).
• Due to their knowledge of smartphones, they are well aware of the refurbishing
process. However, it is unlikely that refurbished smartphones can meet their
expectations.
• Expert Techies’ response towards the incentives reflects their expertise and desire
for new technology and high performance as especially the product-related
incentives that result in a better performance increase the chance of purchasing
a refurbished smartphone.
14. RECOMMENDATIONS
• In general, consumers evaluate refurbished products with visual
information about prior use (i.e., wear and tear) more negatively.
• It is best to update the exterior to a like-new condition. Consumers
evaluate refurbished products more positively if no signs of prior use are
visible.
• When we decide not to upgrade the exterior (e.g., due to high costs), it
can be interesting to provide verbal information about the prior use of a
refurbished product. Consumers then consider this information “nice to
know” and it may help them in trusting the functionality of the refurbished
product.
• In order to get around this barrier the refurbishment companies can
communicate planned messages about packaging and through using
sales promotion.
15. • Ideal packaging that can e given by
refurbed phone providers. This not only
rejuvenates the new phone feeling but also
reinvents packaging of used phone market.
• As we stated earlier people are looking for
that “NAYA Phone Wala feeling”
• With every new launch of iPhones, Samsungs,
OnePlus we have a mandatory unboxing
video.
• This is basically cheapest promotion one that
a techie customer (Online buyers) will look
into.
• For example – 2Gud does not provide their
own packaging while amazon wraps the
products with their own box(which is widely
accepted by customers). In both situations a
branded packaging feeling will increase
customer curiosity.
VS
17. ATTRACT
• First, it is crucial to attract consumers when still in the orientation phase, by
tackling the identified barriers and triggering consumers’ interest to take
refurbished products into consideration.
• Attracting consumers starts with building awareness and making refurbished
products widely known as a high- quality alternative for new products.
• Promotional activities should be developed that arouse consumers’ curiosity
and communicate the distinctive properties of refurbishment.
• Collaborate to improve accessibility and offer refurbished products via
different online and offline stores close to the consumer.
• Extrinsic product characteristics, like store interior, advertising, product
presentation and packaging, can be used to develop a shopping
experience that evokes emotional appeal and a thrill of newness
18. CONVINCE
• After attracting the consumer, the consumer should be convinced of the value of
a refurbished product during the in-depth evaluation of risks and benefits.
• Because the evaluation phase comprises of a more rational assessment of risks
and benefits, consumers should be provided with extensive, transparent and
accessible information about both the refurbishment process and specific
product properties.
• This information provision should communicate the functional, financial, and
environmental benefits of refurbished products to attract environmentally
conscious consumers.
• To significantly reduce the perceived risk related to refurbished products,
companies should strengthen their product offer with high-quality service and
warranty programs that relieves consumers from any product performance-
related risks.
• Finally, to gain consumers’ trust, companies should strive to support their offer with
independent confirmations, such as consumer reviews or quality labels.
19. INVOLVE
• The last step in working towards increased consumer acceptance of
refurbished products, is to involve consumers in the use and growth of
refurbishment.
• Companies should invest in building strong relationships with customers and
use customers as ambassadors of refurbished products. (Testimonials from
users, referral programs etc.)
• Positive word of mouth and increased familiarity will be crucial to build
awareness and convince consumers of the value of refurbished products
• Unboxing videos by enthusiasts, and by well known news channels (their You
tube handle) featuring this category of phone with 32Checks brand
20. BREAKING BARRIERS
The incentives aim to boost the adoption of refurbished smartphones by
1) Providing information
• Consumer awareness and knowledge about refurbed process can increase through promotional
activities and content marketing.
• A detailed classification system that informs consumers about
what to expect from their specific smartphone regarding outer
appearance, use history, battery status etcetera and thereby
reduce the perceived performance and financial risk.
• Show images on the listing such as
• A quality certification can also reduce the perceived risk. These be
via third-party certification systems such as amazon renewed verified vendor or if possible some
govt. recognized certification
• 32Checks already uses a highly advanced diagnostic tool from Blancco, which they can leverage
21. BREAKING BARRIERS
2) Providing service
• Firstly, companies can allow consumers to try the product by introducing a longer trial period (15-20 days
replacement/exchange). This reduces doubts that consumers have about the functionality
• Another way to achieve this is through extensive warranties. Giving consumers the option to extend the
warranty coverage (like water or drop damage) similar to what we have for new smartphones. This can
give them the extra incentive to overcome the perceived risks associated with refurbished smartphones.
• Finally, offering consumers a new business model via a leasing option(buyback/exchange options) may
decrease the perceived performance and financial risks
22. BREAKING BARRIERS
2) Adapting the product
• Companies can also employ incentives that relate to the actual smartphone and its
functional performance to reduce risks and enhance perceived financial benefits.
• Although adapting the product via hardware upgrades is not yet possible for all
smartphones, smartphone design provides ample opportunities for enabling these changes
in future refurbishing processes
• By upgrading separable components of the smartphone during this process, different levels
of restoration can be established for the following 4 components:
• Battery
• Performance
• Screen
• Internal storage
• A novel appearance can positively affect perceived performance quality
23. WHY WE NEED BRAND 32CHECKS
• For high volume sale – they have to get their brand name out in the market.
• They want to increase their customers, for this they have to increase the volume that
they sell. Right now they only get their inventory through amazon and 2gud.
• In general after sales provided for refurbished phones are bad due to sector being
highly unorganized, here 32Checks who provide highest quality of after sales
equivalent to Samsung or Apple in terms warranty and quality of refurbished phones
is lost to the consumers.
• A consumer will value 32Checks’s service at same level as any other or even treat it
as just a 2nd hand phone as he doesn’t know 32Check’s brand and its value.
• 32Checks has to leverage its high quality service to create a benchmark in the
market. So that if someone buys a refurbed phone it should be synonymous as
buying from 32Checks. This will also increase their sales volume.
24. SOLUTIONS FOR BRAND BUILDING
• Online brand building:
• Search engine optimisation on google. Targeting
keywords –+Refurbished +Phones, 2nd hand phones
• “32gunn sampan” social media campaign.
• Unboxing videos by most trending social media
personalities.
• Small advertisements on social awareness of
refurbished phones – recycle/reuse
• “Naya phone wali feeling” social media campaign.
25. • Offline Brand Building: Though this is smaller market with increasing digitization, they
can still tap into this market and grow faster
• They can get the retailers to spread word of mouth for them, they can give
incentives to them.
• Display hoardings with 32Checks on it. Visiting cards with 32Checks on it. For retailers
and dealers.
• Display 32Checks process in simple language on the tables in retailer shops. Or
strategic locations where a customer will look at commonly on the shop.
• Shelf linings covered with 32Checks banner, creating a perception for customer that
they are buying premium brand and not a phone (similar feeling to iPhones)
• Small kiosks with repeated flash sales where 32Checks buys back old phones at
easily accessible places: Malls, major office parks – Stalls near digital stores, Big Bazar
(using their flash sales). Seasonal buy backs like Diwali Sales.
• Other ideas for 32Checks:
• High quality box with brand logo. QR coded pamphlet for authentication of service
gone into the phone to refurb. Techies look at this and can explore this tweet on
their handles about its uniqueness.
• Small articles in big papers or maybe a trendy online campaign on twitter, everyday
some tweet that is fresh and catchy and relates to brand 32Checks