Customers browse mobile phones at a store. (Photographer: SeongJoon Cho/Bloomberg)

India’s Smartphone Market Grew 14.5% In 2018, Says International Data Corporation

The smartphone market in India grew 14.5 percent in 2018 with shipment of 142.3 million units, as per research firm International Data Corporation.

In the previous year, shipment stood at 124.3 million units.

During the December-ended quarter, smartphone shipment expanded 19.5 percent year-on-year to 36.3 million units from 30.3 million units in the same period the previous year, driven primarily by multiple rounds of sales by e-tailers beyond the festive Diwali period lasting into December.

Amongst the big highlights of 2018 were the online-focussed brands that drove the share of the online channel to an (annual) all-time high of 38.4 percent in 2018 and a whopping 42.2 percent in the fourth quarter of 2018
Upasana Joshi, India Associate Research Manager - Client Devices, IDC

She added that this was primarily driven by several rounds of discounts by e-tailers, driving affordability through various financing options, cashback offers and buyback schemes.

IDC said "the offline channel had a rather muted year with a modest 6.7 percent annual growth in 2018 and growing 5 percent sequentially in Q4 2018".

"The offline channel was unable to keep pace with the deep discounts and go-to-market initiatives from the e-tailers almost throughout the year," IDC said, adding that offline still remains the largest channel for mobile phone distribution in India and is crucial for the long-term success for any brand in India.

IDC Associate Research Director for client devices Navkendar Singh said almost all the brands which were able to find traction in 2018 via e-tailers partnerships have already started their offline foray to establish themselves for the long-term. "This has become more crucial as the new e-commerce guidelines come into force from Feb. 1 2019."

Under the new foreign direct investment rules for online marketplaces, such e-commerce companies, among other provisions, are barred from exclusive tie-ups with brands.

Xiaomi led the top three players' tally in the fourth quarter and full year (28.9 percent share for both time periods), followed by Samsung that had 18.7 percent share in December quarter and 22.4 percent share in the entire year. Vivo had 9.7 percent share in the fourth quarter and 10 percent share for the full year.

IDC said the average selling price remained flat in 2018 at $158, with high shipments in the mass segment of $100-200 accounting for more than half of the smartphone market in India.

"The premium end of the market (above $500) outgrew all other price segments in 2018 with 43.9 percent YoY growth, although it still constitutes a meagre 3 percent share of the overall smartphone market," Joshi said.

The feature phone market, which makes up 56 percent of the total mobile phone market, clocked 181.3 million-unit shipments in 2018, with 10.6 percent year-on-year growth.

This was primarily driven by Jio Phone shipments through the year, contributing to 36.1 percent of the overall feature phone shipments, IDC said.