The COVID-19 virus’ impact was felt by the Indian smartphone market in the first quarter of 2020. Although the country went into lockdown only towards the end of the quarter (from around March 20 onwards), its impact was deep enough to reduce growth in the quarter to a mere 4 percent as compared to Q1 2019, as per a report on the quarter by Counterpoint Research. There were nevertheless some very interesting trends observed in this period. These were the most notable:
Xiaomi still on top, with highest share since 2018
Xiaomi remained the number one player in the Indian smartphone market, growing by a modest 6 percent year on year, but still ending up with a 30 percent marketshare, which is its highest since Q1 2018. The brand’s Redmi Note 8 series, as well as its offline expansion, played a major role in its success. Incidentally, Xiaomi also had the largest share of the overall phone market, which includes feature phones.
Vivo consolidates number two
Vivo had surprised a lot of people when it had taken the number two slot in the Indian market from Samsung in Q4 2019. Well, it clearly was not a one-off, for the first quarter of 2020 has seen Vivo take the second spot again with a 40 percent year on year growth to have a market share of 17 percent. Its Y series did particularly well, and as per the report, the brand exited the quarter with low inventories – always a good sign.
Samsung flies in mid-segment, stumbles in budget segment
Samsung was not too far behind Vivo in Q1 2020, with a market share that was just one percent lesser – 16 percent. However, it recorded a steep year on year decline of 84 percent. Its stars in this quarter were its mid-segment devices like the Galaxy A51, A20s, A30s, and M30s, and its more affordable premium models like the Galaxy S10 Lite and the Galaxy Note 10 Lite, but it lost out to Redmi, Realme, and Vivo in the sub Rs 10,000 segment, where it had once held sway.
Realme, Oppo continue fourth-fifth battle
The battle between fourth and fifth continues to be a close one, even as the brands fighting it out recorded impressive growth. As at the end of 2019, Realme finished just ahead of Oppo with a 14 percent market share as compared to 12 percent of Oppo. Realme grew a staggering 119 percent year as compared to Q1 2019, with the budget segment C3 and 5i doing well. Oppo, for its part, surged by 83 percent as compared to last year, with the A5 2020 and A5s doing very well.
Poco surges into reckoning
Poco, which had made headlines with the F1 in 2018, made an amazing comeback in Q1 2019. Although it was launched only in February, its X2 model did well enough to get it a market share of 2 percent. Not surprisingly, it emerged as one of the top five brands in the Rs 15,000 – 20,000 segment.
Samsung takes the premium crown
The premium phone segment – that of Rs 30,000 and above – saw a surprise of sorts with Samsung overtaking OnePlus to be the number one player. The Galaxy Note 10 Lite and the Galaxy S10 Lite are likely to have played a major role in this surge.
Apple reigns supreme in the ultra-premium segment
When it comes to phones priced above Rs 45,000, Apple continued to dominate the Indian market. A strong performance from the iPhone 11 and some great discounts on Amazon and Flipkart saw the brand grab an amazing 55 percent market share!
A challenge ahead for OnePlus
OnePlus was the leading player in the premium segment a while ago, and the report expects it to expand its presence in the ultra-premium segment with the launch of the OnePlus 8 series. However, given the launch of the iPhone SE, Samsung’s newfound budget flagship strength, and the constraints imposed by the lockdown situation, we think the Never Settler has a real battle on its hands.
Tough days ahead for OEMs, entry-level devices
The days ahead are likely to be tough ones for the industry, as a lot of the period would have been spent in a state of lockdown in which no phone sales took place. The report foresees a challenging time for OEMs as they will need to manage existing inventory across all distributor and retail points, and also accommodate a phased opening up of the lockdown. The report further states that as entry-level smartphone consumers are likely to be the worst-hit by the lockdown, the demand for entry-level smartphones will decline in the near-term. It states that demand is likely to shift to the second part of the year, and people might postpone purchasing until the festive season, even if the situation on the ground stabilizes by the middle of the year.
A word from Canalys too…
And even as this is being written, Canalys too has submitted its report for Q1 2020. Although that report shows the Indian smartphone market growing at a more impressive 12 percent, its rankings of the top five are similar, with Xiaomi at the top ( 30.6 percent, 10.3 million units shipped), Vivo at second (19.9 percent, 6.7 million), Samsung slipping to third (14 percent, 6.3 million), Realme being at fourth ( 11.7 percent, 3.9 million) and Oppo at fifth (10.4 percent, 3.5 million).
Canalys too expects the market to dip in Q2 2020, because of the Covid lockdown and highlights that worker availability given limited public transport will be the challenge for OEMs, as will be the reduction in production capacity with expected new manpower regulations (stressing social distancing) once the lockdown does get lifted. It, however, expects consumer demand to be robust and also expects online channels to do well as consumers get wary of purchasing offline thanks to the virus scare.