Warc, 28 February 2013
BANGALORE: Apple, the consumer electronics giant, is putting in place a new strategy for growth in India, where its market share languishes a long way behind Android-powered devices.
A new report from Canalys, a mobile research firm, says Apple sold 500,000 iPhones in India during 2012, mostly in the final quarter when the iPhone 5 was launched. But the high price of this device ensures it remains out of reach for most people in the country.
This figure also compares with 19.6m iPhone shipments to China and 1.4m to Brazil.
Accordingly, Apple is linking up with new distributors including Ingram Micro and Reddington as it seeks to reach a wider market.
It is also employing more sales and marketing staff – numbers are up 30% in the past six months – who will be used to train service providers and retailers.
And, thirdly, it is addressing the issue of affordability with a 12-month payment plan.
"Most people in India can't afford a dollar-priced phone when the salaries in India are rupee salaries. But the desire is the same," Himanshu Chakrawarti, chief executive of The MobileStore chain, told The Star.
The MobileStore claims to sell 15% of iPhones in the country and saw sales triple between December and January, after the monthly payment scheme was launched.
Apple is restricted from selling directly via its own shops or online, and instead currently sells through around 2,000 "mom-and-pop" stores and 65 franchisee-owned "Apple shops" in malls and other high-end spots.
The moves are a turnaround from CEO Tim Cook's position last year when he said that Apple had "higher potential in the intermediate term in some other countries." And he observed then that "the multi-layer distribution there [India] really adds to the cost of getting products to market".
As well as looking to sell more phones, Apple is also stepping up the introduction of its other devices; Apple TV is expected to reach stores very soon.
This is an area where high brand recognition is thought to have benefited Samsung, which also sells products such as television sets and air conditioners.
Data sourced from Wall Street Journal/The Star/World News Resource; additional content by Warc staff