Online Sale Share Increases to 43% in the Indian Smartphone Market in Q2 2020: Report Xiaomi, a Chinese phone manufacturer, remained at the top with 44 per cent market share through online channels

The ongoing pandemic has forced businesses to move online in order to keep the cash flow running. Due to this pandemic majority of the population irrespective of the geography, have moved to online to get access to contactless delivery.

Smartphone industry which has over the years gradually shifted to online from mom-and-pop shops, and have started launching their devices exclusively on various e-commerce websites which continue to enjoy dominance on online channels. While smartphone sales in the online segment declined by 46 per cent year-on-year, the offline segment declined by 54 per cent.

According to a report by Counterpoint Research, online channels held a 43 per cent share in Q2 2020 in the India online smartphone market, as people inclined towards contactless delivery.

The quarter witnessed e-commerce giant Amazon grabbing a 47 per cent share, whereas Walmart-owned Flipkart settled with 42 per cent of the share.

The report suggests that in the remaining year, the online channel will enjoy 45 per cent of the smartphone sale in the country.

Commenting on the COVID-19 situation and market dynamics, senior research analyst Prachir Singh said, "The COVID-19 pandemic had a huge impact on the overall smartphone market, April being a washout month. Online channels' shipments also declined compared to the last year. However, due to the current circumstances, consumers are preferring online platforms. We have already witnessed pre-COVID level shipments at the end of Q2 2020 due to the pent-up demand created in the market by the nationwide lockdown. Brands are aligning their product as well as channel strategies to drive up volumes. Multiple financing options and attractive offers have made the devices more affordable for consumers. During the quarter, multiple brands adopted an online-to-offline (O2O) business model and hyperlocal delivery to help their offline channel partners."

Commenting on the Q2 2020 findings, research analyst Shilpi Jain said: "Online channels remained strong in Q2 2020, grabbing a 43% share in the overall Indian smartphone market. Pent-up demand and changed consumer behaviour due to the current circumstances, accompanied by attractive offers and promotions by online platforms, were the main reasons for the increased share. During the quarter, Flipkart organized Big Savings Day Sale to drive up volumes. Due to the preference for online channels, no offline-exclusive model was launched during the quarter. However, during the same period, 11 online-exclusive SKUs were launched."

According to Jain, Xiaomi, a Chinese phone manufacturer, remained at the top with 44 per cent market share on online channels. It's Redimi 8A Dual became the top model in online channels. Korea's Samsung during this quarter managed to increase its share to 25 per cent, its highest share in online channels. OnePlus remained the top premium brand on Amazon. The five-year-old brand captured more than 50 per cent share in the online premium segment followed by US-headquartered Apple. On Flipkart, Realme remained at the top in terms of number of sales.

In Q2 2020, offline channels captured 57 per cent market share. Jain believes that the numbers in offline channels will improve in the latter half of the year. Vivo and Samsung remained at the top in the offline channels.