iPhone Sales Falling Drastically in India: Report

iPhone 5Apple products which were once seen as an object of desire seem to be losing their sheen in India at least. A recent report states that Apple has seen a drastic fall in sales during January to March this year, when compared to last three months of 2012.

According to IDC, between January and March, Apple sold some 120,000 iPhones in India, down from the 230,000 in the October-December quarter of last year, reports The Economic Times.

In a bid to improve sales, Apple was the first to offer buy back and installment schemes for customers. This move was followed by its competitors including Samsung and BlackBerry for their premium devices. In its fastest Indian launch ever, Apple began selling the iPhone 5 in India barely 5 weeks after the global launch. Once the fanboys were done, sales seem to have petered out.

“The October-December quarter was an exceptional one for iPhone, but that hasn’t been the case since then,” said Manasi Yadav, who tracks India’s smartphone market for researcher IDC, told ET.

The iPhone 5 was also a departure from the previous iPhones with a 4 inch screen. Most consumers and analysts had hoped for more from the new iPhone and it was only last month that Apple unveiled an all new refreshed iOS 7 which will be publicly available in September this year, along with probably a new iPhone.

The report states that iPhone sales have been on a downward trend in response to the marketing campaign and financing schemes, since most people see the iPhone has a premium product and such schemes dilute the value of the brand. We honestly doubt that this could be a major factor in the trend of iPhone sales. The major reason we feel is that there are options offered by competitors at various price points and consumers are seeing more value in those phones.

According to IDC, the fall in sales has translated into Apple’s market share falling from 4.7% to 2.1% in India. The company is not even close to the top 5 smartphone makers in India, which includes Samsung, Nokia, Sony and homegrown brands such as Micromax & Lava. Nokia’s Lumia which most say are struggling had three times the sales of the iPhone in India with almost 6% market share.

Can these reports be trusted?

Recently when CyberMedia Research released its April Market Review of mobile handsets we questioned the authenticity of these reports as there was a big mismatch with the IDC data of the same period.

If one looks at the global smartphone shipments, Gartner says that Apple had a 9.0% market share during the first quarter of 2013. While some may say that the iPhone was never about market share what is concerning is the drastic fall in sales in India. Apple is scheduled to announce its earnings on July 23rd so we could get a clearer picture of global sales then.

The one place where Apple still leads over its competitors is the App Store which still sees more revenues in spite of having less number of devices. While iOS devices have just one App Store, Android has multiple stores including the official Google Play Store, Amazon Appstore, GetJar and others.

iPhone-vs-Android-Google-Trends

If one looks at Google Search trends, the decline in interest in the iPhone is very evident. Analyzing the period from the launch of the iPhone 5 (September 2012) to date, one can clearly see that there is a sharp fall in searches for the iPhone just after the launch period. Looking at the searches for Android, there is actually a steady increase in the searches over the last 10 months.

Google is also also all set to open retail stores for Android all over India in partnership with Spice Global. This move will definitely improve the visibility of the brand and further increase sales of Android in India.

Considering the competition has caught up with and even surpassed the iPhone in terms of hardware and software specifications is it time for Apple to seriously consider a low cost iPhone?

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