Back Market, the world’s largest online marketplace for refurbished electronics, just announced an amazing growth in sales. They increased their revenues threefold within one week when former President Donald Trump declared tariffs on electronics. This surge is indicative of consumers’ fear of both rising prices, as tariffs are about to be imposed, and the uncertainty that comes with them.
On April 11, Trump declared a temporary exemption for electronics. This maneuver provided a brief respite before the anticipated wave of targeted, sector-specific tariffs began. These tariffs are likely to take effect as soon as May. Consumers will be left to begin panic-buying to avoid paying even higher prices.
Dan Ives, a notable analyst, suggested that many American consumers might currently opt for used or refurbished devices as a temporary solution. He predicts that as soon as their financial situation is better, they’ll go back to buying new technology.
Back Market recently expanded to the U.S., where it now sells roughly one-third of its products. With the upcoming tariffs, that would be a shocking situation to continue. Thibaud Hug de Larauze, co-founder of Back Market, American’s biggest opportunity yet! He challenged them to start looking at electronics with a different set of purchasing criteria.
“This is a big opportunity to change the way American people consume this stuff, because the incentive has never been as high to avoid those tariffs,” – Thibaud Hug de Larauze
What’s more, the lack of clarity about how long these tariffs will last only compounds the consumer panic. They can take days, weeks, months — or in some cases never see the light of day. Consumers are responding, albeit quickly, to this unprecedented Wild West environment. Such urgency may lead to a quick and dramatic increase in the sales of used and refurbished devices, particularly smartphones.
“Maybe some people rushed into [replacing their smartphones or computers] earlier, because they were afraid it’s going to cost so much more weeks from now,” – Thibaud Hug de Larauze
Hug de Larauze made it clear that this is a red flag consumer behavior can shift overnight. He’s counting on tariff-dodging financial incentives to result in two-thirds of those sales going to U.S. customers.
Reflecting on this unusual boom in interest towards refurbished devices, Dan Ives was quick to temper expectations about what consumers really want. He stressed that of all the consumers who are focused right now on alternatives, a huge number still want new products.
“We believe 80% to 90% of consumers like buying a new smartphone [and] buying behavior is hard to change,” – Dan Ives