Canalyis Report : Indian Smartphone Market Shrinks By 50% In Q2 2020, Boycotting Chinese Phones Is Not The Reason

According to a Canalyis Report, The Smartphone shipments in India fell 48% in Q2 2020, to 17.3 million units as India faced an unprecedented shutdown of its economy until Mid-May due to COVID-19. As offline retailers were shut down and e-commerce websites were only delivering essential items sales took a nosedive. 

Xiaomi was the market leader in India, capturing 31% of overall market share, shipping 5.3 million smartphone units in the quarter. Vivo maintained the second position, shipping 3.7 million units, and grew its market share to 21.3% from 19.9% in Q1 2020. Samsung was third, with 2.9 million smartphones shipped, and also saw exports impacted as its largest manufacturing plant outside of Vietnam shut down for most of Q2. Oppo edged out Realme to take the fourth position as it shipped 2.2 million units, compared to Realme’s 1.7 million.

Demand is coming back, as there is a pent up demand for smartphones as Digital Content consumption, Work from home and learn from home is the new normal. But there are challenges too.

“While vendors witnessed a crest in sales as soon as markets opened, production facilities struggled with staffing shortages on top of new regulations around manufacturing, resulting in lower production output. The fluidity of the lockdown situation across India has had a deep-rooted effect on vendors’ go-to-market strategies. Xiaomi and Vivo have undertaken an O2O (offline-to-online) strategy to support their massive offline network. Online channels, too, while seeing a positive effect of the pandemic on market share, have seen sales decline considerably.” says Canalys Analyst Madhumita Chaudhary

Most of the Tech brands are approaching the Digital Market with the Phygital model, where you place an order online and the local dealer closest to you will deliver the product or service as required. 

According to Canalys Research Analyst, Adwait Mardikar "Canalys estimates that over 96% of all smartphones sold in India in 2019 were manufactured/assembled locally. “Vendors are driving the message of ‘Made in India’ to consumers and are eager to position their brand as ‘India-first.’ Despite the sentiment, the effect on Xiaomi, Oppo, Vivo and Realme is likely to be minimal, as alternatives by Samsung, Nokia, or even Apple are hardly price-competitive,” 

It's not all bad news though, Samsung has recently invested heavily in India with its Asia’s largest factory in Noida, Apple is taking steps with Foxconn in India as well. Meanwhile, Jio is in crosshairs of Major tech players, like Facebook, Intel and Google.