Info-tech

Old phones give Apple a big India bite

Varun Aggarwal Mumbai | Updated on January 09, 2018

Passers-by take pictures of Thane resident Mahesh Paliwal, whoarrived on a horse to buy an iPhone X, for ₹1.02 lakh. - DEEPAK SALVI

Tim Cook’s market strategy seems to have paid off



Apple’s bet on India seems to be paying off with the iPhone-maker witnessing over 100 per cent growth in shipments and a doubling of revenues.

For the quarter ended September 30, iPhone sales in India more than doubled to 8.90 lakh units. That’s close to 9,900 units a day. In the year-ago period, Apple shipped 4.39 lakh iPhones. It has thus grown 103 per cent, according to CyberMedia Research.

Apple Inc’s revenues across geographies grew 12 per cent this quarter from the year-ago period. “...revenue from emerging markets outside of greater China was up 40 per cent, with great momentum in India, where revenue doubled year over year,” Apple CEO Tim Cook told investors in a conference call on Thursday.

Old is gold

As markets such as the US and China move towards saturation, India continues to be Apple’s biggest bet. Even though the iPhone continues to be a niche brand, Cook’s strategy to keep older versions in play is paying off.

“iPhone 7 sales were better than iPhone 6S, and iPhone 8 and iPhone X could follow a similar trajectory. Moreover, the success of the flagship device also helps Apple sell older versions of the iPhone,” said Faisal Kawoosa, Lead Analyst at research firm CMR.

According to Anshul Gupta, Research Director at Gartner, “In India, there are a lot of replacement buyers who are buying their second smartphones — that is the target for Apple and those are the ones buying iPhones.”

The iPhone 5S is the biggest seller: the handset currently retails at about ₹16,999, vis-a-vis the iPhone X, which has a price tag of ₹89,000. With such a broad spectrum, Apple is able to sell models as much as four years old. “There is still a lot of pent-up demand for Apple products in India, considering the aspirational value that it still carries. Therefore, when people buy an iPhone for less than ₹20,000, they often don’t mind it being 3-4 years old,” said Jayanth Kolla, CEO at Convergence Catalyst.

The large product portfolio is supplemented by a plethora of offers from e-commerce and telecom companies, as well as credit card firms, boosting iPhone sales further.

Correction

This report was modified on November 7, 2017 to Research Director at Gartner as Anshul Sharma. The last name has now been corrected to Anshul Gupta.

Published on November 03, 2017

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