Online Smartphone Market India Q2 2019: Xiaomi Losing Grip!

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Xiaomi, which had once taken the India smartphone market by storm with the jaw-dropping prices of their devices available only online, is apparently losing its grip on the online smartphone market in India.

A recent report released by Counterpoint Research highlights that online smartphone shipments In India have been growing at a steady pace in spite of all hullaballoo by offline retailers. As compared to last year, the smartphone shipments online grew by a significant 26% in Q2 2019.

The biggest highlight, however, of the report is Xiaomi’s performance in the quarter. The leader of the overall India smartphone market, Xiaomi suffers a drop in its online smartphone shipment share. From 55% in Q2 2018, the Chinese smartphone OEM’s share dropped to 46% in Q2 2019. Considering the fact that Xiaomi hasn’t been performing that badly, this slump in market share can be attributed to a number of factors. Let us look at it in a little more detail.

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Online Smartphone Market India: Rise in competition

One of the main reasons behind the slump in the market share of Xiaomi was the aggressive marketing tactics employed by competitors. Such tactics have proven fruitful for companies like Samsung, Realme and Asus and resulted in the rise of their shipment share in Q2 2019.

The one capturing the eye the most among them has to be fellow Chinese smartphone manufacturer Realme. From only 4% market share a year back, the company accounted for 17% online smartphone shipment share in Q2 2019.

Even the rest of the companies in the market experienced a rise in market share, including the likes of Samsung and Asus. Only Huawei is the one suffered the most because of the controversy surrounding the company along with the Android ban. All this competition led to consumers getting access to more diverse options. Hence, the market share of Xiaomi naturally fell.

Despite declined shipment share Xiaomi still owns about 46% of the online smartphone shipment market in India. The unparalleled performance of Xiaomi was driven by the immense popularity of Redmi Note 7 pro that helped the company to capture the lion’s share of the market. It was the most sought after model in Q2 2019, accounting for 12.1% share of the market. This was followed by another entry-level smartphone Redmi 6A, that captured 6.4% of the market. But more importantly, it was a smartphone from Xiaomi as well. These two models were closely followed by two Realme products, Realme C2 and Realme 3. They had a similar market share as that of Redmi 6A, at 5.9% and 5.6% respectively.

The trend clearly indicates that the growth of the online India smartphone market is still pegged to entry and mid-range devices. All five top-performing smartphones online, which collectively accounts for over one-third of online smartphone sales in India, fall in the sub-15k price category.

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Three of the top five performance smartphones in terms of online sales in India belongs to Xiaomi.

The increasing penetration of high-speed internet in India has created an unprecedented opportunity for all smartphone brands. As people have become more comfortable with online shopping, smartphone brands like Xiaomi flooded the internet with smartphone models tagged with jaw-dropping prices. It is estimated that online channels account for around 40% of total smartphone sales in India.

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