India’s smartphone market witnessed flat opening in Q1, hope for revival in the festive quarter: IDC

Hemani Sheth Mumbai | Updated on May 08, 2020 Published on May 08, 2020

India’s smartphone market witnessed a flat opening in the first quarter of 2020 with a year-over-year (YoY) growth of 1.5 per cent to 32.5 million units, according to the International Data Corporation’s (IDC) Quarterly Mobile Phone Tracker.

Despite a slow start, India was the only country amongst the top three to witness a growth n the smartphone segment. Both, China and USA markets faced a YoY decline by 20.3 per cent and 16 per cent respectively in Q1FY20.

“Inventories remained high throughout the distribution channels due to seasonally low demand in the first quarter, clubbed with the Covid-19 impact from mid-March 2020 onwards as the nationwide lockdown was announced,” the report said. The growth is largely due to online channels, it said.

“The online channel grew by 9 per cent YoY in Q1FY20 due to multiple new launches, attractive discounts, cashback offers, and affordability schemes registering a share of 43.1 per cent. On the other hand, offline channel shipments declined by 3.5 per cent YoY, owing to fewer consumer offers, fewer retail walk-ins, and a more aggressive portfolio available on e-Tailer platforms across leading brands,” said Upasana Joshi, Associate Research Manager, Client Devices, IDC India.

Premium segments decline

The market was dominated by the sub-US$200 segments according to the report which accounted for 76.2 per cent of the market. The mid-range segment of grew 87.4 per cent owing to the sale of devices such as the Samsung Galaxy A51, Vivo S1 pro/S1, and Redmi Note 8 Pro.

The mid-premium segment declined YoY by 33.8 per cent.

“Samsung shipments still witnessed multifold growth with its newly launched Galaxy A71, Galaxy S10 Lite, and Galaxy Note 10 Lite, followed by the realme X2 Pro/X50 Pro and OnePlus 7T,” the report said.

The premium segment was dominated by Apple, followed by Samsung and OnePlus. The feature phone segment, which accounted for 41.2 per cent of the overall mobile phone market in India declined by 29.4 per cent with shipments of 22.8 million units in Q1 of 2020.

Xiaomi leading the India market

Xiaomi continued to lead in the overall mobile phone market for the second consecutive quarter with a market share of 18.3 per cent, followed closely by Samsung and Vivo. Realme and Oppo followed closely behind.

Xiaomi accounted for 45.8 per cent market share with its shipments growing by 3.4 per cent YoY.

Vivo following Xiaomi had a 29.8 per cent share in first quarter.

Festive quarter poses hope for revival

The pandemic is likely to have a substantial impact on the Indian mobile industry owing to supply chain disruptions and slower consumer demands.

“Covid-19 will have a substantial impact on the Indian mobile phone market in 2020, with potential supply chain disruptions and slower-than-expected consumer demand for the next few quarters,” said Navkendar Singh, Research Director, Client Devices & IPDS, IDC India.

“IDC expects the India mobile phone market to follow a U-shaped recovery from 3Q20 onwards. The pent-up demand from the first half of the year will gradually shift to the second half, rolling over to 2021 as well. A revival in consumer demand is expected around the festive quarter of 4Q20; with amplified marketing and promotional activities,” Singh said.

“In these challenging times, brands must relook at their marketing investments, supporting offline channels with hyperlocal delivery initiatives in key cities and try to make up for the lost ground in the all-important second half of year, under the assumption that normalcy will gradually resume Q3 onwards," he further said.

Published on May 08, 2020

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