When the pandemic forced people to stay indoors, smartphones became their window to the world, helping them stay connected with friends, Work From Home (WFH) and even learn new recipes.
And 2021 promises to bring back double-digit growth for the smartphone industry as people embrace hybrid work models, binge on web series, and continue the pursuit for the perfect selfie on their six-inch screens.
This year has been challenging for the industry right from the beginning as supply chains for components were disrupted amid rising COVID-19 cases in China.
Given the heavy reliance of the Indian phone and electronics industry on imports from the neighbouring nation, there were apprehensions that stocks would run out, hitting local assembly.
By March, there were bigger worries. Rising number of coronavirus cases in India forced the government to impose a nationwide lockdown that barred movement of everything but essential items like food and medicine.
However, after the lockdown was eased, the industry saw a never-seen-before level of demand. Shipment in the September quarter is estimated to have touched an all-time high of over 50 million units. Pent up demand, coupled with people rushing in to buy devices to ensure continuity of work and studies, saw tech brands literally struggling to keep up.
Counterpoint Research Senior Analyst Prachir Singh said that despite losing almost one-and-a-half months to lockdown, there is just a six percent year-on-year fall in shipment at 148 million units in 2020, reflecting the "resilient nature" of the Indian smartphone market.
"In 2021, the Indian smartphone market is estimated to grow at 20 per cent y-o-y. Major reasons for such a high growth will be increased consumer spending as economic activities grow, and aggressive product strategies from top brands," he said, adding that Jio's anticipated launch of low-cost 4G smartphone with Google could add further momentum.
Image Source: Shutterstock
Domestic players like Micromax could also make a strong comeback next year.
Xiaomi India Managing Director Manu Jain said the first half of 2020 had multiple challenges like supply constraints, production restrictions, and difficulties with on-time delivery that further amplified demand.
"Once lockdown restrictions were eased, we started working towards meeting customer demands... quickly ramping up our production capabilities. We also re-visited our marketing strategies, launched formats, and business goals that resonated with the ''new normal''," he said.
A Samsung India spokesperson said when the pandemic impacted footfalls across retail outlets, it started working on ways for retail partners to leverage digital platforms to serve consumers. It also stepped up efforts to provide affordability solutions across devices like smartphones, tablets and personal computers.
Players like Xiaomi and Nokia, through its partnership with Flipkart, forayed into the laptop space this year to compete against giants like HP, Dell Technologies, Lenovo, Acer, and Asus.
By mid-2020 amid tensions on the Indo-China border, topics like ''Boycott China'', ''Go China'' and ''Go Chinese Go'' started trending online while there were calls for ''vocal for local'' and ''Make in India'' on the ground.
techARC Founder and Chief Analyst Faisal Kawoosa noted that while there were anti-China sentiments, there was an equal urgency to buy smartphones to support WFH and online classes.
"Also, people did not want to venture out much to get their exact choice... Other than Samsung, none of the non-Chinese brands was widely available. So, users had to go logically even if their emotions could have been on the other side," he added.
Four of the top five smartphone brands in India are Chinese, with Samsung as the only exception in the tally.
The pandemic saw smartphone usage zoom. A study by Vivo found usage going up 25 percent to almost seven hours a day after the pandemic as people spent more time on their phones working, calling, consuming OTT (Over The Top) services like Netflix and Spotify, gaming, browsing through social media, and even taking more selfies.
With the help of smartphones, people tried to learn new things, including cooking and gardening.
To cater to this burgeoning demand for electronics and to promote local manufacturing, the government unveiled the Production Linked Incentive (PLI) scheme this year.
Sixteen proposals — entailing an investment of Rs 11,000 crore — were cleared, including those from Apple's contract manufacturers Foxconn Hon Hai, Wistron, and Pegatron, as well as Samsung, Lava, and Bhagwati (Micromax). These proposals will see phones worth Rs 10.5 lakh crore being manufactured in India in the next five years.
Scaling up manufacturing aggressively brought its own set of challenges too. Taiwan's Wistron, which assembles Apple iPhone SE at its Narasapura plant near Bengaluru, recently saw a section of workers go on a rampage over non-payment of wages. After an investigation, Wistron found faults in its wage payment processes and fired its vice-president who was heading India operations. Wistron has been placed on probation by Apple till corrective actions are completed.
CMR Head (Industry Intelligence Group) Prabhu Ram said the issue puts a spotlight on labour policies in India.
"Amidst the ongoing supply chain realignments, the government is focused on taking a bigger bite of the manufacturing pie. Going forward, the government will have to redouble its efforts to improve the ease of doing business," he added.
Sales of other "smart" products — right from TVs to wearables — have also boomed this year.
OnePlus India General Manager Vikas Agarwal said high demand for smart TVs is being driven by rising consumer preference for built-in smart functions in personal devices, sleeker designs, a range of display options, and increasing internet penetration.
"On the back of these evolving customer preferences, the growing popularity of OTT platforms and robust Internet connectivity, we believe the smart TV market will continue to grow in the near future," he added.
True Wireless Stereo (or earbuds) witnessed a growth of over 700 percent in the number of units shipped, while wearables like smartwatches and smartbands have surpassed pre-COVID levels after an initial impact because of lockdown.
According to Samsung, 2021 will see three key trends — 5G going mainstream, foldable devices gaining more traction, and Artificial Intelligence (AI) and Internet of Things (IoT) redefining parameters of what phones can do.
"We'll focus on how we can bring 5G technology at more affordable price points and how we can bring high-end experiences more for the masses," HMD Global Vice President Sanmeet Singh Kochhar said.
This year saw Xiaomi and Samsung jostling for the top spot in the smartphone market while Vivo, Realme, and Oppo occupied the next three positions. OnePlus, Samsung, and Apple wooed customers with their premium portfolio.
The pecking order in 2021 maybe anyone's guess but customers can surely expect sleeker, more powerful and stunning devices in their hands.
Edited by Saheli Sen Gupta
Link : https://yourstory.com/2020/12/india-smartphone-segment-double-digit-growth-story-2021
Author :- Press Trust of India ( )
December 24, 2020 at 01:03PM
YourStory