Can Apple finally crack India’s smartphone market?

“Consider that India, a market of 700 million users purchased barely 9 million smartphones last quarter,” Horace Dediu writes for Asymco. “Contrast that with the Chinese market where 1.1 billion users purchased 88 million. The preference in India is for super low cost products of dubious progeny.”

“In other words, the preference in India is about what it used to be in China two years ago,” Dediu writes. “Will India follow China out of non-consumption? It’s hard to say.”

Dediu writes, “The Indian market is not yet ‘cracked’ as Tim Cook would say. One wonders if it ever will be.”

Read more in the full article here.

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    1. No. TOp line iPhone can be sold. People got lots of money. Company need to promote through service provider and / or have some 30 to 50 stores in large cities. It is not hard to sell it but need to plan well.

  1. I really respect Horace Deideu. He’s one of the smartest and most insightful people out there. My hunch is that he’s trying to find good data to give him better visibility about India. But I read a great article from brokerage house T. Rowe Price about the emerging wealth and desire for luxury products in China, India and Southeast Asia.

    In fact, China is passing the United States as the largest consumer of luxury products. India in its urban centers is rapidly doing the same. And the demand for luxury brands in countries such as South Korea, Singapore, Thailand and elsewhere in Asia is rapidly growing. Brands such as Mercedes, Audi, Coach Leather, Gucci, Chanel, Rolex, Luis Vuitton, Hugo Boss, expensive wines and spirits, and more are in high demand – and Chinese, Indian and other Asian consumers have the pent-up desire, and money to buy their products.

    That’s where Apple has an opportunity. So while Gizmodo sneered at Apple for its rumored champagne colored iPhone, I immediately concluded that the “gold” iPhone was never meant for most American consumers. But in China and India, gold or champagne colored metal is a BIG deal. And Apple is only too smart to offer what Asian consumers demand.

    As for India, I sense it’s a country with two potential markets:

    1. An increasingly wealthy, luxury brand conscious, middle-class urban professional consumer willing to buy an iPhone
    2. A more traditional consumer with far lower income, either urban or rural – this will continue to be a greater challenge for Apple to crack.

    In the case of the citizens of India and other consumers in emerging countries, price matters. Mobile phones are changing how villages connect with the world. But because of their limited means, often, an entire village might pool its collective funds to buy and share a single phone. For them, the cheapest phone might be enough, and I doubt that even a low cost iPhone would suit them.

    in the cities, more ordinary consumers who are not the white collar professionals or technocrats again might opt for a low-cost phone. Keep in mind that in India, phones are not typically subsidized as they are in the US. So price is very important.

    However, if Apple can even gain 5% additional market share in a country with 700 million potential customers, it would be a huge jump in sales. And if Apple can lock down a deal with China Mobile after years of frustrating negotiations, it could unlock a market of nearly 800 million China Mobile subscribers. China has become far more competitive, given the penetration of Samsung and increasingly, native Chinese phone brands. But Apple has the cachet of a leading luxury brand.

    In all, it’s a competitive landscape. But Apple is not stupid. I am optimistic that growing these huge potential markets by 2-10% market share could significantly increase the company’s revenues and profits.

    1. India is China without all the political problems. China will always be a pain in the ass. Apple, or any other American company, is not likely to be thrown out of India. The same can’t be said about China. Though necessary because of its potential markets for American companies, it’s kind of like walking on egg shells. Once established in India, it’s a much more stable long-term reliable relationship. That really matters in business. Plus let’s face it, China is like Google : evil.

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