Analysts say smartphone demand set to boom in India driven by replacement buyers
Apple, the maker of iPhone and iPad is aggressively pushing into India, a market where it still enjoys a tiny share in the smartphone market compared to many other global markets.
While in one hand it has launched aggressive media campaign through its distributors in India Ingram Micro Inc and Redington, the California-based company is also going overboard in expanding its exclusive stores.
Apple's new found aggressiveness in India comes at a time when rivals like Samsung with its popular android-based smartphones and Blackberry backed by its recently launched Z10 smartphones are quite established brands in the Indian market.
Industry observers believe that while Apple’s aggressiveness is quite timely in the Indian market where the opportunities are set to expand driven by the replacement buyers. These are the users who have already tested smartphones and are looking at having different experiences.
“The smartphone boom is going to happen in the Indian market. If you look at China or other matured markets, smartphones are already over 30-40% of the total market. Such aggressiveness by Apple in the Indian market clearly shows their intent to capture the large opportunities which are available in India,” said Anshul Gupta, principal research analyst, Gartner.
Despite being the second largest cellphone market in the world, feature phones continue to enjoy significant market share in the country where about 95% of the users have prepaid connections. Smartphones account for just a tenth of total phone sales in the country.
Samsung dominates the smartphone market in India with a market share of about 40% share with its wide range of Android devices. Local players like Micromax and Lava also enjoy significant faith among Indian consumers in the smartphone segment offering similar look and feel smartphone devices at affordable prices.
Recently, Apple has started ad campaign in India through newspaper advertisements pushing iPhones through installment payment plans to make the device more affordable to Indian customers.
“I think with its aggressive ad campaign and by offering smartphones through installment schemes, Apple is clearly trying to understand the mindset of the Indian buyers who are always price sensitive. It is a well thought of strategy,” said Deepak Kumar, founder of Businessandmarket.net, a provider of market research and advisory services focused on IT and telecom.
Last year, Apple expanded its sales presence in India by appointing two distributors. According to recent media reports, the company is planning to triple its exclusive stores in the country to around 200 by 2015.
The company’s strategy for Indian market seems to have started paying dividends. A recent report by Reuters quoting analysts at a Singapore-based analyst firm, Canalys said iPhone shipments to India between October and December last year nearly tripled to 250,000 units from 90,000 in the previous quarter.
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