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Home / News / India /  India smartphone market grew 1.5% YoY in January-March, says IDC report

NEW DELHI: India's smartphone market had a slow start, growing a tepid 1.5% year-on-year (YoY), with 32.5 million units shipped in the first quarter of 2020, International Data Corporation (IDC) said in its Quarterly Mobile Phone Tracker for January to March.

However, India was the only country among the top three that posted any growth. Smartphone shipments in US dropped by 16% YoY, and fell 20% in China during the period.

“The online channel grew by 9.0% YoY in Q1 20 due to multiple new launches, attractive discounts, cashback offers, and affordability schemes registering a share of 43.1%," Upasana Joshi, associate research manager, Client Devices, IDC India, said in a statement.

“On the other hand, offline channel shipments declined by 3.5% YoY, owing to fewer consumer offers, fewer retail walk-ins, and a more aggressive portfolio available on e-Tailer platforms across leading brands," added Joshi.

Budget smartphones continue to drive the market. The average selling price in the quarter ended March was $171, with the sub-$200 segment accounting for 76.2% of overall shipments.

However, people have started showing more interest in mid-range phones ($200<300) as their market share increased to 18.2%, growing at 87.4%. Samsung Galaxy A51, Vivo S1 series, and Redmi Note 8 Pro were some of the most sought after phones in this segment.

The mid-premium segment ($300<500) declined 33% YoY, accounting for just 3.8% of total shipments. Apple continues to rule the premium ($500+) segment, with 62.7% market share. In the $700<1000 segment, shipments doubled with the iPhone 11 alone accounting for 68% of shipments.

Feature phone segment fell further, with sales down 29.4%. However, feature phones still accounted for 41% of combined mobile phone market.

With 31.2% market share, Xiaomi still has a s significant lead over rivals Vivo (21%), Samsung (15.6%), Realme (13.1%) and Oppo (10.6%). In terms of YoY unit change from Q1 2019 to Q1 2020, Realme was the biggest gainer growing at 119.4% at a time when Xiaomi grew 3.4%.

Samsung was the only vendor whose shipments declined during the period under review, down 28.4%.

Although the home ministry permitted factories in green and orange zones to re-open, Indian mobile market will take months to recover from the shock of covid-19.

“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," Navkendar Singh, research director, Client Devices & IPDS, IDC India, said in a press statement.

IDC expects the India mobile phone market to follow a U-shaped recovery, beginning third quarter. The restricted demand from the first half of the year will gradually shift to the second half, and may even trickle into 2021. A revival in consumer demand is expected around the festive quarter of Q4 2020, if brands amplify marketing and promotional activities.

“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," Singh added.

According to CMR and Counterpoint Research’s quarterly report, India smartphone market performed slightly better, growing at 4% YoY.

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