India has emerged as the largest (in some case second largest) potential market of smartphones. But based on the results of the reports of Cybermedia Research, Smartphone sales in India has gone down by 7% in the first financial quarter this year. Speculations says that it is due to the change in duty implementation and recent restrictions of supplies from China.
Lets take the look at the complete smartphone market :
The whole mobile market is down by 15% to 53 million units in Jan-Mar compared to Oct-December period. The most intersecting fact about the impart of mobile handset in India is that 37% were smartphones. So before even discussing it further, lets take a scenario. Suppose do you have a smartphone bought by you a few days ago, would you buy another one in coming week?
The result of this decline is basically the law of demand and supply:
Smartphones in India have been bought by consumers as an urge of the smartphone over once traditional keypad mobiles. Other customers are those who wished to have a change of smartphones just to get 'with the pace of the technology'. And remaining are those who quench their thirst of deals and exclusive offers while shopping smartly buying exactly what they need. But after it the customers saturates him/herself for a few years to go till he/she buy another one. Recently, India developed a gap between the requirement of handset and the availability of them in the market. Now the gap is filled upto a large extent and it will again take a few months till the gap widens.
CMR Lead Analyst Telecoms Research Faisal Kawoosa said in a statement:
“With major announcements of new handsets and entry of some new brands happening in a big way in Q4, 2014, there wasn’t really something very exciting in the market for customers that could push up sales in Q1, 2015, Samsung’s ability to add to its portfolio in all the major price segments within smartphones by launching new models in each of the entry-level, mid-range and high end segments of the market contributed to this increase.
Micromax, at second spot, registered a decline in market share in smartphone segment to 16.2 percent in the said period from 17.8 percent in the previous quarter. (because it is one of the king of smartphone below Rs.10,000 market.
Micromax strategy is wrong. said CMR Telecoms Analyst Karn Chauhan:
"e-Retailing works effectively for a brand aiming for 0-5 percent or 5-10 percent of the market share and those without a wide portfolio like Xiaomi and OnePlus.
But, if you are Micromax, having a double-digit market share of middle to higher order price segment handsets, trying to replicate what Xiaomi and OnePlus are doing isn’t a very good idea.”
It would only take a few months when India again gets the same growth as it had last year.