Smartphone Shipments in India Decline 50.6 Percent YoY in Q2 2020, Recovery Expected in Second Half: IDC

Smartphone market in India faced a sharp year-over-year (YoY) decline of 50.6 percent to 182 lakh units in the second quarter ending on June 30, according to International Data Corporation (IDC) estimates. The national lockdown that was in place through the first half of the quarter is believed to be the key reason behind the decline. However, despite seeing the major dip in shipments, the research firm is optimistic on seeing some recovery in the second half of this year.

As per the data shared by IDC for the second quarter, Xiaomi continued its domination in the Indian smartphone market, with a market share of 29.4 percent. The company is said to have shipped 54 lakh units in the quarter — registering a 48.7 percent YoY drop.

Samsung came at the second spot with 48 lakh shipments and 26.3 percent share in the second quarter, according to the report. The South Korean giant registered a YoY change of 48.5 percent, slightly lower than the drop reportedly seen by Xiaomi.

After Xiaomi and Samsung, Vivo secured the third position in the market with 32 lakh units shipped in the second quarter that helped the company capture a 17.5 percent share. Realme and Oppo came fourth and fifth with 9.8 and 9.7 percent market share.

In terms of YoY change, Oppo faced the steepest dip of 51 percent in the second quarter over all other players in the top five. The company had “severe stock issues” chiefly due to the closure of its Noida factory owing to multiple COVID-19 cases surfaced in May. That development also impacted Realme and OnePlus to some extent.

Smartphone shipments in India declined to 182 lakh units from 368 lakh units reported last year
Photo Credit: IDC Quarterly Mobile Phone Tracker, August 2020

The market didn't see any changes in the average selling price of smartphones that remained flat at $161 (roughly Rs. 12,000) in the second quarter, IDC notes. However, the sub-$200 (roughly under-Rs. 15,000) segment swelled to 84 percent due to dampening consumer sentiment. Similarly, the sub-$100 (roughly under-Rs. 7,500) increased to 29 percent from 20 percent a year ago, with Redmi 8A Dual alone contributing 33 percent of the total shipments in the segment.

In the premium segment that is over $500 (roughly Rs. 37,500), IDC says that Apple continued to dominate the market with a share of 48.8 percent, followed by Samsung and OnePlus. The iPhone 11 and iPhone XR are said to have captured 28 percent shipments in the segment.

IDC expects that overall, the smartphone market in India would see some signs of recovery in the second half of the year as major festivals are set to begin in the country that would enhance consumer demand. “However, this will be dependent on brand marketing and channel initiatives, especially by eTailers during the festive sales,” said Navkendar Singh, Research Director, Client Devices and Imaging, Printing and Document Solution (IPDS), IDC India.

“Brand initiatives around multi or hybrid channel strategies will also play a key role as offline partners and brands will be looking for pockets of growth in these crucial next few months,” he said.

Online vs offline growth
According to IDC, the online sales channel in India registered a market share of 44.8 percent in the second quarter, up from 43.1 percent in the first quarter, while the offline channel dominated with over 55 percent share in the quarter. However, due to lockdown restrictions in the initial period that affected deliveries in the country and limited stock for most of the quarter, the online channel saw a decline of 39.9 percent YoY.

“Many offline channel partners adopted new ways of marketing by reaching out to consumers through social media platforms, WhatsApp, references, etc., for doorstep demos and deliveries, as well as accepting contactless payments,” said Upasana Joshi, Associate Research Manager, Client Devices, IDC India. “However, these initiatives were limited to big and medium-size retail outlets in metros and Tier 1/2 cities, and was not able to arrest the steep annual decline of -56.8 percent for the offline channel.”

Samsung makes comeback as mobile phone market leader
IDC in the report also highlighted that Samsung surpassed Xiaomi and led the overall mobile phone market in India in the second quarter, with a share of 24 percent. Notably, the Chinese company that took the second position in the quarter, dominated the market in the first quarter of 2020 and last quarter of 2019, as per previous IDC reports.

That being said, Vivo continued its third place in the overall mobile phone market in India.

On the part of feature phone shipments, there was a YoY dip of 69 percent to one crore units in the second quarter. It led to a contribution of 35.5 percent to the overall mobile phone market that is considered as the lowest ever for the feature phone segment.

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