Quick Recovery and Sharp Decline Defined Indian Smartphone Market

Posted on: Nov-2017 | Electrical & Electronic

The initial 3 quarters of last year were going just great and smartphone companies had gathered in super earnings right up till Diwali. Then demonetization caught them by astonish, as it did various other companies. The note ban hit producers all over the sector, particularly local handset producers who chiefly depend on cash sales in smaller towns and cities. The following cash crunch led to smartphone trades dropping by 30.5% on monthly basis in November over the festive season in October.

As per an international market research company, vendors in India were impacted the most with a fall of 37.2% in November in comparison to worldwide vendors with 30.5% fall and Chinese companies with a 26.5% fall over the last month. When contacted by the media, Intex and Micromax, the leading vendors of India, refused to comment. "Demonetization affected the handset market at almost all stages, comprising the stock movement and user demand in the distribution channels," claimed Senior Market Analyst at the research firm, Upasana Joshi, to the media in an interview.

In the quarter four of last year, smartphone export posted 25.8 Million units registering same volume as that of a year earlier but dropping sharply by 20.3% over the last quarter due to demonetization, which resulted in relatively reduced user sales in December and November. As per the data offered by research firm to the media, the shipment of smartphone to India in October last year was 10 Million Units that dropped to 9.2 Million units in November and then, to some extent enhanced to 9.6 Million units in December.

The delay was seen throughout all cities. There was a big drop in inquiries and considerably lower footfall at retail stores. To balance this, handset retailers began providing options of zero down payments to enhance sales. To conquer the effect, smartphone companies with huge online attendance began proving easy payment options and EMI to keep the sales continued. In the middle of all this, China-located market share of vendors enhanced sequentially due to increased credit line to distributors, their huge decibel marketing, and the efficient management of the channel.