India is now second largest smartphone market globally, says Counterpoint Research

By Xite - January 27, 2020
Shipping a record 158 million smartphone shipments in 2019, India surpassed the US to become the second largest smartphone market in the world. The Indian smartphone market grew 7% YoY in 2019.

The Indian smartphone market surpassed the US for the first time on an annual level, making India the second-largest smartphone market globally. India shipped 158 million smartphones in 2019 with seven per cent year-on-year (YoY) growth, said a report by Counterpoint Research.

The huge growth is contributed to the mid-tier segment where Chinese brands aggressively introduced many flagship-grade features and capabilities in relatively affordable smartphones to capture demand coming from users looking to upgrade from their first or second smartphone. Additionally, the online channels became the preferred selling platforms to introduce these products faster into the market.

According to Counterpoint’s Market Monitor service, Xiaomi maintained the lead for the second successive year. Realme (255 per cent), Vivo (76 per cent), Asus (67 per cent) and OnePlus (29 per cent) were the fastest-growing smartphone brands on an annual basis.

While the smartphone market witnessed tremendous YoY growth, the feature phone market declined around 42 per cent YoY in 2019 and 38 per cent YoY in Q4 2019. This is due to a slowdown in new shipments from Reliance Jio. Other brand including itel, Lava, Nokia and Micromax registered positive annual growth despite the overall segment decline. itel also emerged as the top feature phone brand in Q4 2019 followed by Samsung and Lava.

India is now the biggest market for Xiaomi, surpassing its home market, China, in 2019. However, owing to the fact that Xiaomi is now serving to a much larger user base in India, its growth rate has declined to single-digit. Hence, for 2020, the company should focus on specific strategies related to user retention and acquisition, respectively.

Driven by budget series in both the offline and online segment, Vivo grew 76 per cent YoY in 2019 and 134 per cent YoY in Q4 2019. The company also gained a lot of users in the Rs 15,000 - Rs 20,000 ($250-$300) segment owing to the S series.  Due to this, Vivo captured the second spot for the first time in India’s smartphone market.

Samsung shipments remained almost flat YoY in 4Q19, while it has shown a five per cent YoY decline in 2019 as a whole. The South Korean giant’s shipments were driven by its upgraded Galaxy A and M series (A51, A50s, A30s, M30s and A20s) – representing a completely new portfolio targeting different channels (offline with A series and online with M series). However, it needs to double-down to keep any momentum going.

Another Chinese player Oppo doubled its shipments YoY in Q4 2019, due to demand for its budget segment device A5s and the good performance of its recently launched devices A9 2020 and A5 2020 in the offline segment. The company is also aggressively moving towards flagship price points with the introduction of the Reno series. However, the Reno series has not gained much traction from users.

Oppo’s sub-brand Realme grew 255 per cent in India in 2019. The growth of realme was majorly driven by an aggressive go-to-market strategy. The company launched several industry-first features with a strong design language in its smartphones, which is resonating well among young consumers seeking value-for-money devices. In the fourth quarter of 2019, Realme also made an entry into the premium segment for the first time with its X2 Pro device, which started sales strongly.

Transsion Group (Itel, Infinix, and Tecno) reached its highest ever market share in the Q4 2019. Transsion remained strong in tier 3, tier 4 cities and in rural India. Itel stood as the top contender in the entry-level smartphone segment (sub-Rs 4,000 price segment), while Tecno and Infinix showcased YoY growth in Rs 6,000 - Rs 10,000 segment by bringing features such as 6.6-inch displays, 20:9 aspect ratio, 5000 mAH battery.

And thanks to the local manufacturing in India and driven by price cuts in its XR device, Apple was one of the fastest-growing brands in Q4 2019. 2019 also saw the fastest rollout of Apple’s new iPhones (11 series) in India, with an aggressive pricing and a good channel strategy. What’s interesting is the fact that the new iPhone 11 series was introduced at a lower price point than the last year's iPhone XR launch, which helped Apple gain share during the festive season and in its launch quarter in India.

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