Apple’s strong India show may sustain on price cuts, aggressive marketing: Analysts

India was mentioned twice by Apple chief executive officer Tim Cook during an investor call after posting record quarterly results, courtesy double-digit growth in iPhone sales in the country. Apple’s iPad sales also grew robustly in India.Analysts in India now expect Apple to continue its strong performance in the world’s second-largest smartphone market in 2020, backed by further price cuts for older iPhone models and aggressive marketing. “We had double-digit growth in many developed markets, including the US, the UK, France and Singapore, and also grew double digits in emerging markets led by strong performances in Brazil, mainland China, India, Thailand and Turkey,” Cook said during the analyst call.Apple’s iPhone revenue in the December quarter climbed 8% from a year earlier to about $56 billion, driven by “exceptional demand for the iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max,” Cook said. The models were launched in September.The company has ramped up manufacturing in India and started production of the iPhone XR in the country last year for the domestic market and exports.73755382 “I think 2020 will be even better for Apple, especially with the kind of portfolio it will have, starting with iPhone 8, XR, 11 series and upcoming 9/SE2 smartphone,” said Tarun Pathak, associate director at Counterpoint Technology Market Research. “Apple revamped its channel strategy in India in 2018, which has helped it in 2019 as well.”“In 2020, as Apple manufacturing in India ramps up, we expect similar efforts by the brand in terms of maintaining price points and active price correction on previous-gen models to make it affordable for aspirational Apple buyers,” said Navkendar Singh, research director at IDC India.However, Singh said Apple will face intense competition in fast-growing segments where consumers are looking to upgrade, with Xiaomi, Oppo, OnePlus and Samsung planning devices in the mid-premium price points of ?30,000 to ?50,000. “It becomes imperative for Apple to go aggressive on marketing and price point play to sustain this momentum during the year,” he added.There are now close to 12 million active iPhone users in India, as per TechArc data. TechArc’s founder-analyst Faisal Kawoosa said the feeder segment to iPhone is widening as the premium segment continues to grow, which means in the next two to three years, there will be a sizeable number of mobile users who could explore iPhone as their next purchase. He added that Apple would have to wait two to three years to double its market share by volume to about 5%.As per IDC, after a slower first half of 2019, Apple revived volumes in the second half by lowering prices of older generation models such as iPhone XR, 7, 8 and Plus series. The iPhone 11 received a good response in India due to a lower launch price than the previous base model iPhone XR ($699 compared with $749).“The attractive launch price clubbed with EMI and affordability schemes helped Apple in Q4 of 2019,” Singh said, adding that the quarter is expected to have the highest shipments for Apple in 2019.As per Counterpoint’s estimates, iPhone shipments grew 6% in India in 2019, after a 43% decline the year before. For the October-December quarter, it grew 41%, more than double the pace of the premium smartphone market, where Counterpoint said the expansion was slower than the full-year average of 20%.Apple also saw growth in sales for its iPads, Apple Watches and AirPods in 2019.“Price reductions on Apple Watch Series 3 and the promotional discounts on Apple Watch Series 5 made the device a popular purchase among consumers,” Singh said.

from Economic Times https://ift.tt/2uIlcDS