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Rules and standards are more important to selling trade-in mobile devices on the secondary market than you may think. Here we’ll explore how B-Stock, the world’s leading B2B auction platform, joined an important standardization initiative, and wound up improving sales for mobile device merchants.
Think of the first cell phone you owned. It was probably a blocky brick with few features beyond call and text. Or maybe it had a hinge, or even a camera. And every year or two your one looked vastly different and was packed with exciting new features.
Now think of the last few devices you’ve had. Odds are it was pretty much the same iPhone or Android device as the previous model with a few spec bumps. Not as exciting as it used to be, is it? But the result of a slow-marching, iterative (if unexciting) market is that devices are now more powerful, reliable, and long-lasting than ever. Naturally, they’re also more expensive.
All together, these factors have given rise to considerable consumer demand for affordable pre-owned handsets. Today, used, trade-in, and refurbished devices fuel a thriving secondary market. The trouble, however, is that until recently, mobile manufacturers, carriers, retailers, refurbishers, and secondary market resellers had no shared standard for grading device condition.
Think of it from the perspective of someone who buys devices and flips them for a living. Yes, some of your orders might arrive pristine. But many come with scratches and dings, shattered screens, broken charging ports, dead microphones, and other issues. All of these factors and more comprise a device’s overall condition and, ultimately, its resale value.
Now imagine how the listings for these pre-owned devices must have looked when sellers did the rating. Whether they were making an honest effort to represent the condition of their items or trying to pawn off their less-than-stellar devices as great, they had to rely on arbitrary terms. One seller’s self-awarded “Excellent” or “Grade B” rating meant very little to someone who buys these devices from dozens of different sellers. This created a seller-buyer disconnect that led to disputes, distrust, lost time, and wasted cash value.
Even when sellers would develop and abide by their own very specific grading standards, buyers had to constantly learn, interpret, and compare multiple systems. Although this was better than simply guessing the items’ condition and hoping for the best, the time and effort required still presented a significant barrier to scaling up business.
Recognizing this problem, CTIA Certification, a leading mobile industry association, tasked its Reverse Logistics and Service Quality (RLSQ) working group with developing a voluntary, standardized grading system for use by device suppliers, wireless operators, insurance companies, logistics, parts suppliers, and repair organizations.
The group assembled a board of experts to weigh in on exactly what a grading standard should include and how to structure that standard to make it as descriptive, comprehensive and useful as possible. The group included representatives from major carriers, consumer electronics giants, top insurance organizations, logistics leaders, key refurbishers, and others.
When B-Stock, an online auction platform created to connect buyers with sellers, learned of this effort, we saw this as a great opportunity to join the cause.
As the world’s largest B2B auction marketplace for pre-owned mobile devices, our business depends on low-friction, high-transparency interactions between trusted buyers and sellers. We knew we would have something important to add to the discussion. In 2018, the company approached CTIA offering to contribute its expertise.
CTIA happily received the overture and, with B-Stock on board, the group set out to determine every key aspect of a mobile device’s functionality and established a granular grading system for each area.
In early 2019, CTIA RLSQ published the first edition of its Wireless Device Grading Scales Criteria and Definitions.
As expected, the widespread adoption of this new standard benefited countless mobile industry stakeholders. In particular, B-Stock’s sellers were able to:
B-Stock buyers, in turn, were able to:
Each side’s satisfaction feeds into the other’s and the end result is a more efficient and productive interaction for everyone.
Hopefully, it’s clear enough how the new standard made our sellers feel when purchasing through the B-Stock platform. But what tactical and strategic differences did these changes actually precipitate?
As mentioned earlier, leaving behind ambiguous descriptions and independent grading standards, buyers felt more confident in the lots they were browsing. In fact, device price depreciation slowed significantly. Prices for old devices will never go up, so curbing depreciation, the rate at which prices drop over time, is the next best thing.
Prices on our marketplaces historically declined at 2.8% per month. But after B-Stock began encouraging sellers to adopt the new CTIA standard, depreciation dropped to 1.9% per month. That’s an impressive 32.7% reduction.
Not only were existing buyers willing to pay more, but purchases among new buyers rose remarkably—post-adoption at 6 months saw a 37.5% increase in the number of new bidders compared to the prior 6 months. Growth of that magnitude is impressive in any endeavor, let alone an enterprise-scale B2B marketplace. With expectations aligned, more buyers were bidding more decisively, putting cash into sellers’ pockets faster than ever before.
Beyond price and active buyers, the switch to a new standard had several other benefits. With the new standard establishing highly accurate market prices, our sellers could now:
Finally, both sellers and buyers enjoyed an incredible 50.7% reduction in disputes over device condition, saving time and improving seller-buyer trust and relations.
In 2021, the organization published CTIA Certification Wireless Device Grading Scales Criteria and Definitions V2.0, which expands the industry standard for grading aftermarket wireless devices to include tablets, another well-loved development of the ever-shifting tech landscape.
Today, the standard remains a living, breathing resource. Always on the lookout for the latest mobile market trends, the CTIA Certification team has been carefully watching foldables, wearables, and IoT devices.
With the standard still relevant today, B-Stock remains determined to contribute its expertise in developing new iterations that cover the latest products and features that the mobile device market has to offer. It will also continue to support and evangelize these important standards across its own user base—for everyone’s sake.