Online retail rules when it comes to smartphone sales, says study

This reflects the rising consumer trust and digitalisation of purchase journeys fueling online retail contribution to overall category sales of smartphones, said a report from GfK market intelligence

Online channel contribution for the smartphone market accounted for 40 per cent in terms of sales units and 41 per cent in terms of sales value during YTD 2021, compared to 35 per cent  in 2020, said a report from GfK market intelligence.

According to GfK market intelligence, overall category sales in terms of units for offline retail (point-of-sales) grew by 4% whereas online retail sales grew by 29% during YTD Oct 2021 as compared to 2020. This reflects the rising consumer trust and digitalisation of purchase journeys fueling the online retail contribution to overall category sales of smartphones, said the report.

Kartik Vasudevan, Director – Sales, GfK India, “As markets have moved from “want” to “need” norm, it is not only about the product/ device but consumer ‘Lifestyle’. Consumers turned to tech to continue working and learning while staying at home and this has triggered some structural shift in buying behavior. As @home norm continues, consumers are keen to invest in products which promise quality and longevity.”

Looking at the price trends, GfK Market Intelligence point-of-sales data outlined an increase of sales unit by 56% for premium smartphones ranging between Rs 30k – Rs 40k. Sales also went up for smartphones priced above 40k by 41%, which underlines the increasing demand for premium products in the Indian smartphone market.

In terms of geographical penetration of the smartphone market. The overall sales for smartphones in tier 5 & above representing less than 50k population registered 11% volume growth in offline retail during YTD Oct 2021/ 2020, followed by 7% increase in tier 3 cities.

Vasudevan added, “Smartphone market is still dominated by less than Rs 15k price segment, however, there has been an increase in sales of premium products as mobile phones have essentially become the first digital touchpoint or device to access the internet. For some consumers it is their first computer in a way and with 5G paving its way, this trend might accelerate the price push further.”