Smartphone market to shrink again this year
NEW DELHI : India’s smartphone market is grinding through its second year of contraction, the first time since the market took off 14 years ago, a Mint analysis of data from three market research firms showed. Smartphone shipments that crossed 100 million for the first time in 2015 peaked at 160 million in 2021 before shrinking 10% to 144 million in 2022.
According to data from IDC, shipments may fall a further 2-6% to touch 135-140 million in 2023. Upasna Joshi, research manager at IDC India, said average sale prices have jumped nearly 30% in the last two years, leading to “challenges in final sales to consumers".
Shipments in the January-June period were nearly 10% lower from a year earlier, in an ominous trend for brands and retailers ahead of the festive season when shipments typically spike in anticipation of increased purchases. High inflationary conditions have squeezed disposable incomes, especially at the bottom of the pyramid, impacting upgrades.
“The decline is due to slow demand and inventory build-up, which was carried from 2022. Most of the brands focussed on clearing existing inventory in Q1 and Q2 2023 so that they can plan to push new launches’ inventory in the second half of the year during the festive season," said Shilpi Jain, senior research analyst at Counterpoint Research, which expects the smartphone market to contract by a more conservative 1%.
Aware of the scenario, vendors and manufacturers are working to ensure they don’t over-supply and are expected to give discounts and sales events beginning in August, much before the festive period starts around Diwali. “Brands will focus on providing enticing schemes, discounts, and bundled options, especially during festive seasons, to attract
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