Chinese smartphone brands' market share in India hits 8-year low
What's the story
Chinese smartphone brands have witnessed a major dip in their market share in India. The latest data from Omdia shows that their share has fallen to 68% in the July-September quarter, down from 71% in the previous quarter and 75% a year ago. This is the lowest in more than eight years. Counterpoint Research also recorded a similar trend with these brands holding only a 67% share, their lowest since Q1 of 2019.
Market dynamics
Impact of record-high memory chip prices
The decline in market share can be attributed to record-high memory chip prices.
These costs have forced Chinese brands such as Vivo, OPPO, and Xiaomi to cut down on their budget models. This segment was traditionally the backbone of their sales.
The high memory costs have also led manufacturers to reduce the number of models offered in lower price bands and focus more on mid and premium-segment sales for profitability.
Rising competition
Rise of Indian smartphone brands
The high memory costs have opened up space for domestic players such as Lava and Ai+ to capture demand from price-sensitive consumers ahead of Diwali.
Despite the challenges posed by high memory costs, Indian brands are maintaining their product line-ups with a primary focus on volume growth.
According to Counterpoint Research, the combined share of Indian brands jumped from 2% a year ago to 7% in the last quarter ending September 30, their highest since October-December 2018.
Market entrants
Decline in overall smartphone shipments
Tarun Pathak, Research Director at Counterpoint Research, revealed that Ai+ and Lava contributed nearly 95% to the share of Indian brands.
Newer entrants such as Mivi and Boltt have also entered the market.
However, the overall smartphone shipments in India fell by 20-26% YoY in the July-September quarter to a decade-low of 35.8 million units.
This decline is due to high memory costs pushing up prices and consumers delaying upgrades.