According to a report from Counterpoint Research, India’s overall online smartphone shipments grew 23% annually in 2017. In India, online channel contributes to more than one-third of the total smartphones shipped, which is the highest in the world.
Seasonal sales events like Flipkart’s ‘Big Billion Days’ and Amazon’s ‘Great Indian Sale’, aggressive promotions, and value for money offerings from Chinese brands drove the demand for the online channel which grew faster than the overall smartphone market in 2017.
Flipkart led the online smartphone channel capturing more than half of the market in both volume and value terms maintaining its lead with Amazon. Amazon too though was able to grow its share capturing almost one-third of the market in volume and value terms.
The online market in India has become a duopoly with Flipkart and Amazon capturing a combined 84% of the total volume and 87% of the total value. Both retailers together launched close to 100 exclusive model SKUs throughout the year and these online exclusive smartphones were the main contributors to the online sale.
The high-spec but low-cost, value for money smartphone models exclusively available only on online platforms were instrumental in successfully creating unprecedented demand throughout the year.
– Karn Chauhan, Research Analyst, Counterpoint Research
Mi.com, Xiaomi’s own store, at number three is interesting and reflects the big smartphone share that the company was able to garner in the country. With smartphones and accessories, as well as smart home products, Mi.com is an e-commerce store in its own right, really.
While Paytm witnessed modest growth in 2017, most of this coming from the huge discounts offered on high-ASP smartphones like iPhone. This might not be a sustainable long-term strategy though.
The report estimates that the share of online channel will remain flat in 2018 as brands are adopting hybrid channel (online + offline) strategy to extend their reach throughout the country.
In terms of the online smartphone brands, Xiaomi, Lenovo (together with Motorola), and Samsung were the top three brands. Xiaomi led the online smartphone market with 44% share, which is expected since the company’s rise as the number one smartphone brand in the country.
While the budget segment portfolio from Motorola – Moto C and Moto E – and the mid-segment Moto G helped Lenovo to maintain its second position, Huawei’s renewed focus on the online channel has helped its growth. With Honor 9 lite, Honor 7X, and others, Huawei will aim to gain more share this year. Micromax was the only Indian brand among the top five ranking mostly driven by Canvas Infinity sales.