Samsung Trumps Xiaomi To Reclaim Top Spot In Indian Smartphone Marketspace: Study Samsung led the Indian smartphone market space with a 24 per cent shipment share for the first time since Q3 2018 as Xiaomi followed closely with a 23 per cent share

By Prabhjeet Bhatla

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Pexels

Adverse sentiment towards Chinese products has directly benefitted South Korean electronics giant Samsung which has emerged as the largest smartphone brand in the country for the first time in two years in the third quarter of 2020.

A new global and India study by Counterpoint Research claimed that Samsung has become the leading brand in the India smartphone market after two years as it is growing strong at 32 per cent year on year (y-o-y) in the September quarter 2020. It is also the fastest to recover, surpassing the pre-COVID levels in Q3 (third quarter) 2020.

According to the report, Samsung's strong performance is credited to its effective supply chain and touching various price points through new launches. The giant's aggressive push in online channels, with the highest-ever online contribution within its portfolio, also helped it regain its number one spot.

Research analysts at Counterpoint Research are of the view that Xiaomi has slipped to the number two position for the first time since Q3 2018 with 4 per cent y-o-y decline. Manufacturing constraints due to the COVID-19 situation affected its supply chain, leading to a supply-demand gap.

With ramped-up manufacturing, strong demand for the Redmi 9 and Note 9 series, product strategy and growing offline presence, analysts believe Xiaomi will come back strappingly in the coming quarter.

Furthermore, the report from Counterpoint's Market Monitor service shows, India's smartphone shipments grew 9 per cent y-o-y to reach over 53 million units in Q3 2020, This is the highest-ever shipment in a quarter for the Indian smartphone market. The push from the brands coupled with the pent-up demand due to the lockdown and strong sales on online platforms led to this growth. Consumers still prefer online platforms due to the fear of the ongoing pandemic.

"The Indian smartphone market is on a recovery path as the lockdown restrictions have been relaxed. The market has shown consistent growth for the last few months. It saw strong demand during the Independence Day period in August as major online platforms hosted massive sales. September has always been a high sell-in month as brands prepare for the upcoming festive season and push stock in the channels," commented Prachir Singh, Counterpoint Research's senior research analyst, in a statement.

"Almost all the brands recorded growth compared to the last year. In terms of price bands, the mid-tier (INR 10,000 – INR 20,000) segment registered the highest growth and reached its highest ever share in a quarter. Due to the pandemic, Indian consumers have ended up saving on leisure activities. These savings are now being funneled into smartphone purchases. Additionally, smartphones have become an integral part of consumers' lifestyles in this changing environment," Singh added.

The Indian mobile handset market grew by 8 per cent y-o-y in Q3 2020 due to stronger consumer demand in the smartphone segment and stronger sales of feature phones. The feature phone market registered a 5 per cent y-o-y growth in Q3 2020 with Itel being the number one brand followed by Samsung and Lava.

"During the start of the quarter, we witnessed some anti-China consumer sentiments impacting sales of brands originating from China. However, these sentiments have subsided as consumers are weighing in different parameters during the purchase as well," stated Shilpi Jain, an analyst at Counterpoint Research.

"The brands have been quite aggressive as they started building up inventory much ahead of the festive season. Focus on online channels has been increasing due to the COVID-19 situation. Even offline-centric brands like Vivo, OPPO and Itel are increasing their online presence due to the changing consumer behavior. Though online channels remain in focus, OEMs are also trying to leverage new opportunities in offline channels in Tier 2 and Tier 3 cities. In this regard, Xiaomi launched "Mi store on Wheels', Samsung launched Galaxy M01 Core and vivo announced more retail discounts. Additionally, the brands are focusing on affordability by announcing cashback, promotions, and offers on devices," Jain added while commenting on the competitive landscape and brand strategies.

"On the manufacturing front, the Indian government is focusing on increasing the local value addition. Mobile handset production is likely to increase in the coming time as schemes like Production Linked Incentive (PLI) start to impact the overall electronic manufacturing ecosystem. Indian brands like Micromax and Lava are expected to leverage the government's Atma-Nirbhar Bharat initiative and plan their comeback."

A basic customs duty of 10 per cent was announced on display modules and touch panels, which will be effective from the next quarter. This move by the Indian government will impact the cost of production since displays are majorly imported. But it will boost the overall handset manufacturing ecosystem and local sourcing contribution in the long run.

Prabhjeet Bhatla

Former Staff

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Related Topics

Science & Technology

How Can Marketers Use ChatGPT? Here Are the Top 11 Uses.

With the recent developments in AI and the popularity of ChatGPT, you may want to integrate AI into your marketing practices. Find out how.

Marketing

5 Ways ChatGPT Will Impact Digital Marketing

ChatGPT is creating ripples across the digital landscape right now. Here are five ways it can benefit your ads, campaigns and marketing strategies.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

News and Trends

Why Is Venture-debt Picking Pace in India Like Never Before

The trend reflects the market's maturity and the increasing sophistication of venture-debt solutions tailored to the needs of companies, according to a recent report

Starting a Business

How Can You Make Sure Your Business Will Survive Anything? Try These 3 Proven Strategies

No matter how uncertain the economy is, you can survive anything as long as you prepare. Here are a few strategies to consider.

Science & Technology

The Deepfake Threat is Real. Here Are 3 Ways to Protect Your Business

The rising use of deepfakes is a growing threat to businesses and society as technology advances. Here are three tips for companies to combat this threat.