Indian smartphone market heads for steady growth and recovery stage
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Faye Sutton
| 31 December 2021
Analyst firm GfK says there has been overall growth in Indian smartphone sales, price segments and geographical market penetration from January 2021 to October 2021.

EE Netflix Android 11 Aug 2021Overall category sales in terms of units for offline retail (point-of-sale) grew by 4% while online retail sales grew by 29% during the year to date October 2021 compared with 2020. During the same period, online channel contribution for the smartphone market accounted for 40% in terms of sales units and 41% in terms of sales value compared with 35% in 2020. This, says GfK, reflects the rising consumer trust and digitalisation of purchase journeys fueling the online retail contribution to overall category sales of smartphones.

Looking at the price trends, GfK Market Intelligence point-of-sales data outlined an increase of sales by 56% for premium smartphones ranging between 30k – 40k. Sales also went up for smartphones priced above 40k by 41%, which underlines the increasing demand for premium products in the Indian smartphone market.

Kartik Vasudevan, director of sales at GfK India, said: “As markets have moved from ‘want’ to ‘need’ norm, it is not only about the product/device but consumer lifestyle. Consumers turned to tech to continue working and learning while staying at home and this has triggered some structural shift in buying behavior. As working from home continues, consumers are keen to invest in products which promise quality and longevity.”

GfK insights also revealed the geographical penetration of the smartphone market. The overall sales for smartphones in tier 5 and above, representing <50k population registered 11% volume growth in offline retail during the year to date October 2021/2020, followed by a 7% increase in tier 3 cities.

Vasudevan added: “The smartphone market is still dominated by the less than 15k price segment; however, there has been an increase in sales of premium products as mobile phones have essentially become the first digital touchpoint or device to access the internet. For some consumers it is their first computer in a way and with 5G paving its way, this trend might accelerate the price push further.”

There is a cautious optimism in the market, which will be governed by interplay of domestic manufacturing, imports, transportation cost and raw material prices, says GfK.