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Why Indian SmartPhone Companies Are Losing To Chinese Manufacturers

| Published on April 30, 2019

Gone are the days when you could see a Micromax phone in the hands of every second Indian. Gone are the days when you would talk about the brilliant features of an Intex Technology mobile phone. The millennial generation might even just ask, what is Intex or Micromax exactly?

They are the two Indian brands that used to dominate the mobile phones market a few years back. For example, Micromax had a share of 18% in 2014 of the mobile phone market which has now come down to 5% in 2018. On the other hand, Intex technologies have seen it’s sales reduced to half in 2017-2018 as compared to 2015-2016.

The challenging past –

Indian companies are used to tough competition from foreign brands especially when it comes to the smartphone market. From 2010-2014, Micromax and Intex have faced mammoth brands like Nokia and Samsung to stay in the game.

They even started exploring other markets like TV’s, Washing machines and refrigerators to expand and increase sales. They brought out competitive priced products and entered the market but still haven’t achieved a position in the top 5 of the industry. In fact, new entrants did not allow Indian brands to step up in the trending Smart LED television industry.

What’s the new story of 2018?

Xiaomi, a name that is a current leader in the smartphone market in India, entered the television industry in early 2018. It not only challenged Indian players like Micromax but also top players like Sony, Samsung and LG. Indian companies including Lava and Karbonn have been losing out on market shares to Chinese manufacturers, who now have a 60% market share.

Why is this happening?

1) Chinese products offering low prices bring competitive prices down at good value. Affordability is the key here.
2) High levels of innovation and original work by Chinese manufacturers that Indian brands could not keep up with
3) The adaptability of the latest market trends and fast-changing market realities.
4) Expertise in hardware design, strong design language and supplier network.
5) Aggressive marketing based on latest trends and strong research and development department.
6) Advantages in terms of economies of scale, years of experience and high marketing budgets.

All big four Indian brands namely, Micromax, Lava, Intex, and Karbonn saw their shares fall to 10% in total in 2018 of the Indian market.

What is the hope for improvement?

Indian companies though struggling can still bounce back, experts suggest. They can use new innovative technology, come up with attractive offers and focus on better promotion strategies. They need to work on their Research and Development departments and match up to the trends of the Indian mobile phone markets without any further delays.

Moreover, accessing international markets in places like Africa and Eastern Europe can also increase sales.
The existing wide offline retail network by Indian companies can be used to their advantage for marketing and low-cost supply networking.

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