Is the Fairphone 2 ready to beat competition?


Without a doubt, it can be stated that competing with gigantic smartphone brands such as Apple, Samsung, LG and HTC is tough. However, the startup Fairphone apparently saw a niche market for a new type of smartphone.

The introduction of the ‘smartphone’ was probably the last major change in the telephone industry. However, the working conditions and salaries in the manufacturing companies that produce those smartphones, have been heavily criticized. In 2014, an undercover BBC investigation discovered poor treatment of factory workers in Chinese factories that assemble iPhones, which confirms that Apple broke their promises to protect factory workers (Bilton, 2014). Even worse, in 2010, 14 factory workers under the age of 25 committed suicide at Apple’s biggest manufacturer, Foxconn (Moore, 2012).

Bas van Abel, the founder of Fairphone, believed there is a demand for a fairly produced or ‘fair trade’ smartphone. Therefore, he first started to raise awareness about ethical production of products and creating a ‘buzz’ around that idea. Fairphone’s goal was to establish collaborative, fair and transparent relationships with their manufacturers in order to ensure worker representation, safe working conditions and fair pay (Fairphone, 2015). In addition, they aimed to extend a smartphone’s longevity by improving the life span of the product and increasing repairability by making use of a modular design.
Moreover, millions of smartphones are thrown away every year, generating mountains of electronic waste (Reardon, 2012). Fairphone aimed to find a solution for this problem by by creating a simplistic modular design that allows users to repair their own phone by replacing the old parts with new parts, thereby reducing electronic waste.

With the above mentioned ideas in mind, they started developing the Fairphone, but instead of moving to investors or venture capitalists, they directly went to the end users, because they believed the phone should be funded by the public. In their Kickstarter campaign, they were looking for 5,000 people who were willing to pay 325 euros for a mid-range Android device, with no special specifications or industry changing features (Best, 2014). Therefore, the value proposition was the story behind the product, and they needed to fully leverage the social message behind the product in order to be successful. In their first campaign, they sold even more than 10,000 Fairphones upfront, indicating that the production could be started right away.

After the success of their first model, they launched the Fairphone 2 two weeks ago, on September 25. Compared to the first model, the Fairphone 2 has a better life span and it is even more fairly produced. In technical terms, the software got upgraded, the phone is equipped with a faster processor and a better screen resolution (Van Lier, 2015). However, the Fairphone two has a price tag of 525 euro, which is, looking at the hardware and the specifications, rather expensive (Verlaan, 2015).

The-Fairphone-2-Dissassembled_2

For smartphone users that often drop their phone, the Fairphone might be a cheaper option, since all parts are easily replaceable. Also, the device has a considerably long life span, but I think consumers often wish to buy a new smartphone after 2 years.

To conclude, the most important ‘feature’ of this smartphone is that it is produced in a fair and ethical way. As the trend in the organic meat industry shows, more and more people care about how food and products are made. This is the probably the only reason why there is a demand for this product, because if you compare the Fairphone 2 with a smartphone that has equal specifications, you are very likely to find a cheaper option. So, the Fairphone 2 is expected to be successful in their niche market if they fully leverage the media attention and word-of-mouth effect that this product can bring, but they will not evolve into a real ‘competitor’ of Samsung or Apple.

References:

Best, J. (2014). The gadget with a conscience: How Fairphone crowdfunded its way to an industry-changing smartphone [Blog post]. Retrieved from http://www.techrepublic.com/article/the-gadget-with-a-conscience-how-fairphone-crowdfunded-its-way-to-an-industry-changing-smartphone/Verlaan, D. (2015, July 14).

Bilton, R. (2014, December 18). Apple ‘failing to protect Chinese factory workers’. BBC. Retrieved from http://www.bbc.com/news/business-30532463.

Fairphone. (2015, October 09). Our roadmap to a fairer phone. Retrieved from https://www.fairphone.com/roadmap/

Moore, M. (2012, January 11). ‘Mass suicide’ protest at Apple manufacturer Foxconn factory. Telegraph. Retrieved from http://www.telegraph.co.uk/news/worldnews/asia/china/9006988/Mass-suicide-protest-at-Apple-manufacturer-Foxconn-factory.html

Reardon, S. (2012). Will we ever be able to buy a fair-trade smartphone?. New Scientist, 214(2860), 18.

Verlaan, D. (2015). FairPhone 2 Preview: aan de slag met de eerste modulaire smartphone [Blog post]. Retrieved from http://www.androidplanet.nl/reviews/fairphone-2-preview/

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