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Indian mobile companies bulldozed by Chinese counter parts

Indian mobile companies bulldozed by Chinese counter parts

After the intrusion of Chinese manufacturers, the share of local mobile brands has been diminishing substantially in India since 2015. Indian handset manufacturer mainly focuses on the featured packed phones and mid and entry-level smartphone segments. Giants like Korean, Americans and Chinese are leaving behind.

 

Various international phone manufacturing brands have entered the budget phone and multi feature phone market over a period of time. This is directly impacting the sales of Indian manufacturers. The Indian industries are dominated by the Xiaomi, Samsung, and brands like Oppo, Vivo, and OnePlus which are owned by the BBK Electronics. In the overall Smartphone market, Indian brands have less than 2% shares, therefore over the next five years; the chances of survival are minimal.

 

What went down?

 

Chinese suppliers saw bankable potential in migrating into the market directly while they were making products for the Indian mobile brands. Chinese brands took advantage of Indian manufacturers. This helps them to provide premium featured with high specification Smartphones at the same prices. After receiving a positive response, they started investing heavily in infrastructure. They started providing services via their own centres as a sturdy sales service, seller and reseller, and franchise models. Furthermore, they started using strong online marketing and tie-ups. Indian-policies like Make in India gave stimulation to their local production.

 

Indian brands are slowing down their energy to invest in higher capacity manufacturing facilities, even for the manufacturing partner of foreign brands. Their market of mid-level Smartphones plunged down, which pushes them towards improving the features and entry-level Smartphones. It resulted in no major launch of a handset for a long time. This agitated their market shares. In the entire Smartphone market, Karbonn and Intex own only 0.5%.

 

Post-2016

 

Due to demonetization sales of the entry-level Smartphone market as well as the feature phone market were hampered. The segment for the same slowed down extremely from November 2016 to March 2017. 

 

Reliance Jio completely dominates the 4G featured phones4G featured phones. Even after 4G in the market Lava continues to make 2G feature phones which are an Indian brand. The 2G feature phone segment is bigger than the Smartphone market in India. Lava plans on catching up with their own 4G feature phone when 2G has phased out. 

 

Demonetization hampered the sales of the entry-level Smartphone, which are mostly cash-based transactions. This segment slowed down extremely between November 2016 and March 2017.

 

Due to the cash crunch, festive season sales fell by 80%. Vivo and Oppo expanding their segment of mid-level Smartphones and Samsung getting into the segment of an entry-level Smartphone. Chinese brands are shutting down their business. Indian brands like Vivo and Oppo are investing heavily during IPL seasons.

 

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