Smartphone sales and literacy rate go hand-in-hand in India, reveals study

States with higher literacy rates, such as Kerala, Maharashtra, Himachal Pradesh, Gujarat, prefer smartphones over feature phones

Are consumers who can read and write more likely to pick a smartphone? Is literacy a definitive factor in their preferences when it comes to choosing a mobile phone? Prima facie, it appears to be so.

While there is no concrete study on a co-relation between literacy and smartphone sales, the data suggest that regions with a higher rate of literacy are the ones with stronger smartphone penetration.

A recent study conducted by Mobilytiks, a big data-driven analytics programme at CyberMedia Research, shows that people in states with higher literacy rates, such as Kerala, Maharashtra, Himachal Pradesh, and Gujarat, prefer smartphones over feature phones. Delhi is among the top five regions with a higher percentage of smartphones in use.

Kerala, the state with the highest literacy rate of 94 per cent, tops the list with 62 per cent of mobile handsets being smartphones. Fifty-six per cent of mobile handsets in Gujarat, which has a 79 per cent literacy rate, are smartphones. Delhi, Maharashtra and Himachal Pradesh rank third, fourth, and fifth, respectively, with smartphone penetration level pegged at 52 per cent – much higher than the national average of 42 per cent. According to the 2011 Census, these states put together have about 82 per cent literate population, compared to the national average of 74 per cent.

Conversely, states with lower literacy rates are the ones where the smartphone industry has not been able to make considerable inroads. Bihar, the least literate state (61.8 per cent), has the least number of smartphones in use. Only 27 per cent of all mobile handsets in the state are smartphones, followed by Assam with 30 per cent of mobile handsets being smartphones. West Bengal and Madhya Pradesh, where only a third of total handsets are smartphones, have literacy rates of 76.2 per cent and 69.3 per cent, respectively. While the literacy rate of West Bengal is higher than the national average, it ranks 20th among the 36 states and Union Territories in India.

According to executives of handset companies contacted by Business Standard, the co-relation between literacy and preference for smarter devices could be drawn from the fact that educated consumers are more aware of the benefits of possessing a smartphone. Apart from convenient internet browsing, smartphones with larger screen sizes are fast becoming an alternative to other reading devices. Also, the growing number of apps and content providers focusing on digitising books and other reading materials are only adding to its benefits.

“Most states with lower penetration are also the ones that see a large number of working population migrating in search of employment. Also, the lower purchasing power of consumers in these states has kept the penetration level of smartphones lower than the rest," said Faisal Kawoosa, head, new initiatives, CyberMedia Research.

Four out of the five states with the least percentage of smartphones in use are located in the eastern part of the country, which remains off the radar of most consumer goods companies, including mobile handset makers. The market in eastern India is generally considered smaller than its counterparts.

According to Kawoosa, smartphone makers in the country have long ignored the potential in the region and are now gradually increasing their focus on these markets.

The scenario is also changing due to the availability of data at cheaper rates after Reliance Jio disrupted the market. Consumers with lower levels of education, too, are now opting for smartphones over feature phones as online content, mostly in video format, is becoming mainstream. CyberMedia Research predicts the pecking order of states, in terms of smartphone penetration, may look different by the end of this year.