BY: Khushhboo Kabra
Many individuals are sort of boosting the worth of phone selections, and this tendency is particularly visible in towns and villages as affordability is on the rise.
According to Sandeep Sarma of Xiaomi India, the Indian smartphone market has reached a plateau due to a move from volume to value as users are increasingly upgrading to better handsets that they can use for up to three years.
“The average retention time or cycle of using a phone in India was nine months earlier in 2017, which is very short, but it was mostly due to huge leaps in terms of technology at that time,” Mr Sarma, Associate Director, Marketing, Xiaomi India, told The Hindu.
However, he claimed that individuals had been using phones for two, two and a half, or three years. When they upgrade, they purchase a better phone since they are aware of how long they will need to use it, he said.
He claims that most people in the business, including Xiaomi, made a “miscalculation” (about the smartphone market) in 2022 since everyone was confined to their houses during the epidemic in 2020 and 2021, which resulted in an unprecedented demand for smartphones.
Everyone believed that smartphone sales would continue to rise because those two years were a bit of an exception, but Mr Sarma clarified that this was not a reasonable expectation.
“The smartphone market is not actually growing much when you look at the market as a whole; in fact, it may be declining in some regions. This is also a result of customers utilising their phones for extended periods of time, Mr Sharma elaborated.
Regarding consumer trends, he stated that many individuals are sort of premiumising their options; this tendency is especially noticeable in cities and villages. “What I mean by that is that they are improving their smartphones by one or even two levels. Therefore, someone who may have purchased a phone for ₹10,000 a few years ago is likely moving all the way to 30k or 35k instead of choosing the next logical option, which is a smartphone in the 20k area.
Additionally, affordability was getting better. Additionally, users were able to purchase phones that they had previously been unable to afford but now had access to thanks to free EMI plans that ranged from one year to even three years in some situations. All of these indicate that consumers are keeping their phones longer, which is why fewer smartphones are sold overall but their value has been rising, he explained.
He claimed that the trend of people updating their phones and becoming wealthier was far more prevalent in rural markets. According to Mr Sarma, “Affluence and affordability used to be limited to cities, but now it’s going into, you know, tier two, tier three, and even tier four,” Mr Sarma commented.