Smartphone player realme to focus on premium segment

As improved consumer sentiments lead to a rise in mobile phone sales, smartphone-maker ‘realme’ looks at a larger play in two niche segments — the sub-₹10,000 range that has seen rising traction due to online classes and in premium categories of ₹15,000 and above which have seen rising demand amongst professionals.

According to Madhav Sheth, Vice-President, realme and CEO of realme India & Europe, the company has seen its average selling price increase to ₹11,000-12,000, against an industry average of ₹8,000-10,000.

The focus on premium segment – with specifications suiting select customer bases, like say large screen, long battery and high resolution camera devices targeting professionals and gamers – have done well.

Offering for all groups

The company catered to select consumer requirements through ‘C series’ - in the sub-₹10k range, ‘Number’ and ‘Pro’ catering to the youth in the ₹10,000-20,000 range, ‘X’ series flagships (above ₹20,000), and the Narzo in the “performance oriented segment” targeting gamers and multi-taskers. Premium 5G devices and IoT offerings will continue to be focus in 2021.

‘realme’ is the third largest smartphone player in India, as per shipments in October 2020. For calendar year 2020, the company saw a 67 per cent growth in device sales – which was lower than expectations.

According to the International Data Corporation (IDC), the smartphone market in India fell 2 per cent year-on-year in 2020. The pandemic, lockdown, and various restrictions in the entire country led to the dip in sales. Stay-at-home mandates, remote work, remote education, travel restrictions, and manufacturing shutdowns led to a sluggish H1 CY20 — a 26 per cent YoY decline. The second half, however, witnessed recoveries and a 19 per cent YoY growth.

“A period of lockdown, and supply chain disruptions led to loss in sales and a slowdown in numbers. Supply chain disruptions continued all the way to Diwali leading to lower-than-expected sales,” he told BusinessLine.

Supply Chain Disruptions

Sheth added that supply chain disruptions continue still and the manufacturing unit at Noida is operating at 90 per cent capacities. While there was higher than normal demand (pent-up demand) during Diwali, numbers are now “returning back to normal”.

IDC’s Quarterly Mobile Phone Tracker said retail sales gradually picked up during the October and November pre-Diwali weeks in 2020; and the offline channel grew by 5 per cent.

“By April 2021, supply chain disruptions should normalize and we should be back to pre-Covid levels in terms of manufacturing,” he said.

Plans are also afoot to bring-in global component makers into the country. Nearly 60 per cent of the components (screen, batteries and internal structures) that go into a smartphone are now procured from component-makers based out of India; while the remaining 40 per cent are imported.

“We intend to bring down imports further,” he said adding, the company has already leveraged its Noida facility to include production of television sets. Television sets are fully manufactured in India. Wearables and some of the premium accessories are still imported though.

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