The smartphones sales will decline to 127 million in 2020 due to COVID-19: Report

According to a report by techARC, the only strategy to sustain revenues for smartphone brands is to diversify into other categories, which they have been already doing.
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The smartphones sales in India is expected to decline to 127 million smartphones as compared to projected 162 million units, which is a 21.6 percent decrease in the sales forecast made at the beginning of the year owing to the COVID-19 impact, techARC said in its latest report. In 2019, smartphones shipment in India stood at 149 million.



The techARC report estimates that mid segment smartphone (Rs 5,001-Rs 25,000) will be constituting over 92 percent of the total sales this year. It also says that the entry segment (upto Rs 5,000) will continue witness decline and the luxe segment (Rs 50,000 and above) will be least impacted as the propensity to spend will still remain high in that segment.

Faisal Kawoosa, Founder & Chief Analyst, techARC said that potential buyers will look for buying in a segment lesser than their intended segment. "This is as every user would want to save as much as possible owing to uncertainties around. There will be some shift of demand from upper segments to lower ones due to this," he said.

According to techARC, the only strategy to sustain revenues for smartphone brands is to diversify into other categories, which they have been already doing. "There are clearly product lines emerging which can be termed as ‘essential electronics’, ‘pandemic electronics’, ‘safety electronics’, etc. OEMs can diversify in such segments to leverage the consumer sentiments of leveraging from such gadgets to keep themselves safe, secure, productive as well as social," he said.

Brands have recently introduced hyper-local O2O (online to offline) medium where demand is aggregated online and fulfilled through offline retail network in the catchment area of a potential customer.  "This could pick up well and contribute 5-7 percent of the total sales in coming months as the sales can be fulfilled in less than a day," the report said.

"The worst period for the smartphone industry in India seems over as both the production and sale fulfilment has started. Smartphone brands will endeavour this year to stay on track, which means there will be less of experiments and more about relevancy for the consumers. The focus will be offers, after sale support, software updates, etc," Faisal added.
Edited by Kanishk Singh

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