Once aimed at a small elite with their blingy designs, luxury smartphones are being toned down as manufacturers look to broaden the appeal of their high-end devices.
Vertu has released a £4,200 ($6,800) smartphone known as Aster, with a 5.1-inch sapphire crystal screen and titanium casing, materials often used on expensive Swiss watches. Consumers can customize their handmade phone with different leathers including ostrich.
Despite the high-end material used, the design marks a shift away from the diamond-encrusted flashy look Vertu used to make as the company attempts to attract a wider audience looking for a more refined product,
“They have changed their designs a lot to appeal to more Western markets where it is still high quality but a little more understated,” Daniel Gleeson, senior mobile analyst at IHS, told CNBC by phone.
Lower price point phones?
Vertu has typically targeted wealthier consumers in emerging markets such as China and Russia as well as some Middle Eastern regions. Luxury mobile phones saw more than $1 billion of global sales last year, according to Euromonitor, with China, Britain, the U.S. and the United Arab Emirates (UAE) among the biggest markets.
While many in China and the UAE demanded loud designs to show off wealth, the mood is changing among consumers of top-end phones. Vertu’s Aster phone is cheaper than its previous Signature Touch offering released earlier this year, which started at £7,600, but can go above £15,000 if users chose certain customizations.
The company’s chief executive gave a hint that Vertu could be looking at even lower-end luxury phones.
“There are things we are exploring the future, we are a looking at the market, we are looking at our consumers and we will see if we will be able to do something that is truly Vertu … at a high level of integrity that we want, then we can possibly launch another device at another price point,” Max Pogliani, Vertu’s CEO, told CNBC in a TV interview.
BlackBerry also announced the P’9983 Porsche design smartphone last month which sells for £1,400, putting it in the lower-end of the luxury phone market. Swiss watchmaker Tag Heuer is also in the space, and earlier this year announced the Meridiist Infinite phone, which it says can charge via solar power.
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But high-end manufacturers could be jeopardizing their exclusivity by lowering the price point, making it unlikely prices will fall to too low a level, one analyst said.
“Any small change in price has a powerful effect on the demand for the product; i.e., lowering the price of such luxury products will make the device less valuable to a consumer, as the exclusive nature of the product is eroded away,” Nitin Bhas, head of research at Juniper Research, said via email.