Samsung and China-Based Smartphone Makers Continue to Steamroll in India - eMarketer

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Samsung and China-Based Smartphone Makers Continue to Steamroll in India

Fighting for market share, they embrace omnichannel

May 4, 2017 | Mobile

Foreign manufacturers continue to dominate India’s smartphone market. According to Counterpoint Technology Market Research, Samsung accounted for 26% of smartphones shipped in the country in Q1 2017. The next five largest manufacturers as measured by shipments all hailed from China.

Smartphone Shipment Share in India, by Brand, Q1 2017 (% of total)

eMarketer forecasts that demand for smartphones will remain strong, with the number of smartphone users in India growing from 267.1 million this year to 381.5 million by 2020.

Some China-based smartphone manufacturers have managed to make significant gains in India by focusing on offline retail. Players like Oppo and Vivo—which are really two brands sold by the same company, BBK Electronics—have focused largely on getting their products into brick-and-mortar retailers in both urban and rural areas.

In this way, they’ve managed to reach many consumers interested in buying a smartphone who may not yet be comfortable with the idea of making an online purchase. But Oppo and Vivo are also now expanding onto ecommerce platforms like Amazon and Flipkart to tap into digital sales channels, embracing omnichannel to corral as many customers as possible.

At the same time, companies like Xiaomi that have demonstrated great ease with both online marketing and online sales are learning how important offline sales channels are in India. In March, Xiaomi announced that it would send its popular Redmi Note 4—which was previously only available for purchase via ecommerce—to physical stores to reach offline consumers.

Counterpoint Technology Market Research also noted that smartphone buyers in India are slowly moving toward more expensive devices. The firm found that the average selling price of smartphones in the country was up INR2,000 ($30) in Q1 2017 when compared with figures for Q1 2016. Just as has happened in China, smartphone buyers are now spending more on smartphones with a better set of features. But the price point sweet spot in India still remains relatively low, at between INR8,000 ($119) and INR20,000 ($298).

That explains one notable absence from the list of dominant smartphone manufacturers in India: Apple. The Cupertino, California-based company’s device remains a luxury item in India, a situation that has left it with a small portion of the smartphone market there.

Apple, which reported earlier this week that total shipments of the iPhone declined by 1% year over year in the first quarter of 2017, has yet to figure out how to crack the market, despite making efforts to begin manufacturing its flagship device in the country.

Separately, Counterpoint Technology Market Research noted that 96% of smartphones shipped in Q1 2017 were 4G LTE-enabled, underscoring India’s continued shift toward the faster mobile network standard.

This change has been catalyzed by the launch of nascent carrier Reliance Jio’s low-cost 4G data offerings, which will likely have a dramatic effect consumers’ adoption of data-intensive smartphone behaviors such as video consumption.

Rahul Chadha

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