or Connect
AppleInsider › Forums › General › General Discussion › Apple to open small stores in India, focus on entry-level iOS devices in battle for growing market
New Posts  All Forums:Forum Nav:

Apple to open small stores in India, focus on entry-level iOS devices in battle for growing market

post #1 of 19
Thread Starter 
According to a report published on Tuesday, Apple is looking to open a series of smaller "neighborhood shops" in India to push the iPhone in a region dominated by cheaper offerings from rival Samsung.

iPhone India


Citing sources familiar with Apple's Indian retail plans, The Economic Times reports the Cupertino, Calif., company is working with local distributors to set up small shops in large cities and "tier II" markets in what is potentially a grab at Samsung's mobile device marketshare.

Unlike the grandiose flagship Apple Stores synonymous with Apple retail, the Indian outlets -- run by distributors -- will reportedly be far more humble at 400 to 600 square feet. With the limited floor space, Apple is looking to focus primarily on mobile products like the iPhone and iPad, which are to be positioned next to lower-end Macs and iPods.

"Apple wants to focus more on its entry-level models in these stores such as iPhone 4, iPhone 4s, iPad mini and iPad 2, which are essentially in the sub-30,000 segment and also its largest-selling products in India," said an unnamed senior executive of one Apple trade partner.

The publication notes Apple distributors Redington and Ingram Micro, along with smaller partners, will be part of the new push. Sources say Apple is looking to place the smaller stores in more affluent areas with strong smartphone penetration and large student population.

Currently, Apple is a laggard in the Indian smartphone market, capturing about two percent of volume in the December 2013 quarter. In comparison, devices from market leader Samsung accounted for 32 percent while Micromax held second place with 21 percent over the same period.

As is seen in other markets, the value of Apple's market share is higher than its competitors, but volumes could definitely be higher. To that end, the company is rumored to be reintroducing the iPhone 4 in India, possibly at a price of 21,900 rupees, or $360 at today's exchange rates. Currently, the latest iPhone 5c sells for about 41,900 rupees, or $687.
post #2 of 19

I love how that image exists only as a rebuttal to the people who complained about putting the Apple logo in place of the Ashoka Chakra. :lol:

Originally posted by Relic

...those little naked weirdos are going to get me investigated.
Reply

Originally posted by Relic

...those little naked weirdos are going to get me investigated.
Reply
post #3 of 19
I quite like the image. I wonder if any case makers also publish complementary wallpaper for the complete effect.

censored

Reply

censored

Reply
post #4 of 19
Fantastic idea by Apple, if true. I wonder if they'll use them to sell Apple certified used iPhones and iPads as well...
post #5 of 19

The way I've heard it is that no Indians can afford iPhones and they only buy Android smartphones because they're so much cheaper when paying for unsubsidized models.  What do unsubsidized Android smartphones go for nowadays?  $100 or so and getting cheaper by the day.  All I ever hear is how Apple is going to go out of business when all carriers stop offering iPhone subsidies.

post #6 of 19
Quote:
Originally Posted by Constable Odo View Post
 

The way I've heard it is that no Indians can afford iPhones and they only buy Android smartphones because they're so much cheaper when paying for unsubsidized models.  What do unsubsidized Android smartphones go for nowadays?  $100 or so and getting cheaper by the day.  All I ever hear is how Apple is going to go out of business when all carriers stop offering iPhone subsidies.

 

India is an extreme case because it is both unsubsidized and people on the whole are poor.  Apple wouldn't go out of business if carriers dropped subsidies, they would just make less money than they currently do.  Apple's US market share would more likely approach Europe's numbers than India's.

post #7 of 19
Actually, this sounds like a rather smart strategy. Most of the successful retailing in India is done via small, neighborhood stores.
post #8 of 19
Quote:
Originally Posted by Constable Odo View Post

The way I've heard it is that no Indians can afford iPhones and they only buy Android smartphones because they're so much cheaper when paying for unsubsidized models.  What do unsubsidized Android smartphones go for nowadays?  $100 or so and getting cheaper by the day.  All I ever hear is how Apple is going to go out of business when all carriers stop offering iPhone subsidies.

You've heard that '...no Indians can afford iPhones...'!?

I am not sure that you know a whole heck of a lot about the market for high-end mobile phones in India.
post #9 of 19
Quote:
Originally Posted by anantksundaram View Post

Actually, this sounds like a rather smart strategy. Most of the successful retailing in India is done via small, neighborhood stores.

If Apple is not careful with this plan they will lose more money than they make because these units run by the distributors will charge Apple an arm and a leg for the use of their premises.

post #10 of 19
Every shopping mall and upscale shopping street in India has a "Samsung Cafe". This plan will probably start to emulate that strategy. The Samsung shops are modern in design and highlight all their products including air conditioners and TVs, but mobile devices occupy the center section of the stores.
post #11 of 19

I think India is on a threshold right now. With some proper decisions and smart marketing Apple could really break out in the Indian market.

 

The launch of the 5c and 5s was a massive event. While carriers generally hype every iPhone launch, this was the first time that Apple directly launched the phone, with huge crowds on launch day, which forced Apple to start selling 2 hours earlier than expected.

post #12 of 19
Quote:
Originally Posted by Constable Odo View Post

The way I've heard it is that no Indians can afford iPhones and they only buy Android smartphones because they're so much cheaper when paying for unsubsidized models.  What do unsubsidized Android smartphones go for nowadays?  $100 or so and getting cheaper by the day.  All I ever hear is how Apple is going to go out of business when all carriers stop offering iPhone subsidies.

And carriers don't offer subsidies on Android phones?
post #13 of 19
And meanwhile local players are making a killing, selling knock-offs! In fact some imitations have gone to the extremes!

This one from Micromax (the biggest player in Indian market) runs Android 4.2.2 and looks *exactly* like iPhone 5s including colors and trims !

http://www.micromaxinfo.com/canvasknight/

Cost? INR 20,000 = USD 320 approx. !

Very sad state of affairs. These things make my exclamation key get stuck! And only asterisks emanate from my mouth !
post #14 of 19
Quote:
Originally Posted by Crosslad View Post


And carriers don't offer subsidies on Android phones?

 

Yes, they do.  With subsidies gone, however, instead of the choice being to pay 'about $200' and take your pick of whichever phone you like best the choice becomes:

 

iPhone 5s :   $650-850

5c             :   $550-650

Note 3      :   $640

S4             :   $504

Nexus 5    :   $360

S3             :   $260

 

When faced with paying $700 for in iPhone 5s or even $650 for the 'cheap' 5c, quite a few people are price sensitive enough that buying a Nexus for about half as much will make them seriously consider whether they want the pricier 5s or even Note models-especially if they are buying for the whole family.  And the purchasing options are priced downward from there.   Removing subsidies would obviously hurt any models that are heavily subsidized (both Apple and Android), but that's because more price sensitive users would be opting for mid or even low range phones, in which categories Apple has no offering.

 

Obviously the majority of super affluent users that visit AI are price insensitive enough that no price is too high to pay for an iPhone.

post #15 of 19
It is criminal that Apple *still* doesn't have a working online store in India. Five years back, this was an issue, because India did not allow foreigners to setup either single brand or multi brand stores. This was changed five years back to allow single brand stores, and a year ago to allow multi - brand stores.

Dell now offers a full online store in India, including the ability to configure and pay for the product and have it shipped to you. Why can't Apple do this?

I believe Apple has boxed itself in a corner with the current Apple resellers - and has some very uncompetitive practices - very in-Apple like if you ask me. For instance, the global AppleCare warranty is valid throughout the world, but in India, only devices purchased in India are covered. This one policy allows the Indian resellers to charge much more for devices than Apple might otherwise charge.

This whole policy of offering iPhone 4S and iPhone 4 in India is done with the idea of capturing more market share in a price sensitive market. However, what really happens is that these phones are still priced way over the equivalent Android phones. So Indians are left with option to buy a compromised (only 8 GB storage) model that is 30 months old, at a price that is close to double that of a top end model from a brand like Micromax. There are Android 4.3 phones, with 5" screens, quad core processors, and user expandable memory up to 32 GB that cost 40% lower than what Apple charges for an 8GB iPhone 4S!

Apple needs to get its India act right and get it right fast. This is a major market. Making the phones here will allow Apple to save almost 30% in taxes (tax on components is 5%, tax on finished goods imported is over 40%). At a 30% lower price, Apple can easily capture a larger market. And Apple can export from India to get scale benefits. Another way is for Apple to launch India only models, where they don't care to make their usual 40% margins.

This is a large market, and every week Apple delays in coming up with a viable India strategy, there probably over a million Android devices that get sold, establishing a solid presence for Android in India.
post #16 of 19
Quote:
Originally Posted by Frood View Post

Yes, they do.  With subsidies gone, however, instead of the choice being to pay 'about $200' and take your pick of whichever phone you like best the choice becomes:

iPhone 5s :   $650-850
5c             :   $550-650
Note 3      :   $640
S4             :   $504
Nexus 5    :   $360
S3             :   $260

When faced with paying $700 for in iPhone 5s or even $650 for the 'cheap' 5c, quite a few people are price sensitive enough that buying a Nexus for about half as much will make them seriously consider whether they want the pricier 5s or even Note models-especially if they are buying for the whole family.  And the purchasing options are priced downward from there.   Removing subsidies would obviously hurt any models that are heavily subsidized (both Apple and Android), but that's because more price sensitive users would be opting for mid or even low range phones, in which categories Apple has no offering.

Obviously the majority of super affluent users that visit AI are price insensitive enough that no price is too high to pay for an iPhone.

I am no super affluent - far from it. I am one who buys iPhones at the lower end if the scale and am currently still on an iPhone 4. I do not make enough calls to justify a higher monthly contract. I would still rather use a 2 year old iPhone than an equivalently priced android phone.

I do not think you can count the Nexus 5 in the price range as Google make little or no money on these phones, they are a product designed to advertise android rather than make money.

Samsungs in the UK seem to be similar prices to iPhones but the build quality and ecosystem are not as good in my opinion. I have a Nexus 5 bought to try the android experience but still prefer my iPhone 4 and my daughters iPhone 5 is much better in my opinion.
post #17 of 19
Quote:
Originally Posted by Crosslad View Post


I am no super affluent - far from it. I am one who buys iPhones at the lower end if the scale and am currently still on an iPhone 4. I do not make enough calls to justify a higher monthly contract. I would still rather use a 2 year old iPhone than an equivalently priced android phone.

I do not think you can count the Nexus 5 in the price range as Google make little or no money on these phones, they are a product designed to advertise android rather than make money.
 

What about the Moto G? That device is quite competitive with any flagship phone from 2011,  and seems to have been well-received in India at 13000 rb. 

post #18 of 19
Quote:
Originally Posted by Crosslad View Post

I do not think you can count the Nexus 5 in the price range as Google make little or no money on these phones, they are a product designed to advertise android rather than make money.
While that may be true, the business model doesn't make a blind bit of difference to a customer, the price is the price.

censored

Reply

censored

Reply
post #19 of 19
Quote:
Originally Posted by d4NjvRzf View Post

What about the Moto G? That device is quite competitive with any flagship phone from 2011,  and seems to have been well-received in India at 13000 rb. 

I agree it is a goo phone, in fact I just recommended it to a work colleague who was looking to buy their first smartphone. However Motorola were not making any money on it and businesses that do not make money go out of business.
New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: General Discussion
AppleInsider › Forums › General › General Discussion › Apple to open small stores in India, focus on entry-level iOS devices in battle for growing market