Our Prime Minister Narendra Modi will soon be visiting the US (again). This time, however, he will concentrate on the West Coast – home to the biggest tech companies in the world. It’s been confirmed that he’ll be meeting the CEOs of the biggest names in Silicon Valley – Google, Facebook, and Apple.
The last one is what concerns us the most. Why? Well, firstly because we are all about Apple in India. And also, when your PM meets the CEO of the world’s largest company, you should sit up and take notice.
What Will Be Discussed
The exact points of discussion are (obviously) unknown, however, the broad talking points are speculated to be as follows:
Research & Development: Plans to increase Apple’s research and development activities in India are expected to be laid out. R&D is the prerequisite for any long term activity for a company. For this reason, a step forward here will show how serious Apple actually is about its future in our country.
Local manufacturing: A big topic is likely to be the establishment of Apple’s manufacturing plants in India. In fact, Apple’s largest manufacturer Foxconn has already signed a contract with the Maharashtra government to invest $5 billion over a period of five years.
Authentic Apple Stores: For a company that sold over a million iPhones in India in the last year, Apple doesn’t have even one of its iconic Apple Stores in our country. It still depends on third party resellers to sell and service the products. High time to change that, don’t you think?
Marketing Strategy: Although this seems to be a topic for Apple’s internal meetings, Tim Cook is smart enough to tap into Narendra Modi’s exemplary reading of India’s pulse and sneak out a couple of valuable tips from him.
Apple’s Opportunity
Apple has been vocal about the growth potential in India for a long time. This meeting with the Prime Minister is an excellent chance for it to really commit to the country.
India is the world’s largest untapped mobile market, especially for high end smartphones. Arch rivals Samsung and low-end players like Micromax have been stealing Apple’s thunder with more aggressive pricing and marketing. Mr. Cook could not get a better platform to lay down the counter attack strategy.
What happens when you become the market leader by a big margin? You aren’t left with much growth potential. That’s the happy problem that Apple is facing in the US and its other dominant markets. India is a clear exception to this scenario, and given the number of people in the country, increased popularity in India will mean exponential growth for Apple. Business analysts are comparing the potential to be similar to what the company achieved in China. Basically, India is a gold mine in waiting for Apple!
What’s in it for India?
Manufacturing of Apple products in India will reduce import duties and taxes. Localised assembly will reduce transportation costs as well. Thus, the luxury pricing of Apple products will become ‘affordable’. For a highly price-sensitive market like India, even a 10 to 15% drop in prices of iPhone and other popular Apple products can open the floodgates for masses.
Authorised Apple Stores will go a long way in bringing the much needed service quality improvements in the country. A big hinderance in acceptance of MacBooks and other professional products is the lack of their understanding by the common Indian. The Apple Store staff (also known as ‘Geniuses’) should be able to break this barrier with their signature one-to-one training sessions. Lastly, a swanky Apple Store will pull bigger crowds than the pale looking third party retail outlets. Sorry Reliance!
Our Advice for Apple in India
Being the self designated Apple experts in India, we couldn’t resists adding a couple of bonus suggestions for Apple to capture the humungous Indian market
Can’t Escape the Price War in India: We know that Apple works on the premium pricing model and will never get into a dog fight with lower end market. At the same time, even Apple can’t afford to overlook the majority of 1.3 billion Indians. While localised manufacturing will provide some cost relief, Apple has to play the numbers game in india one way or another.
The Real Market Lies Beyond the Metros: Right now Apple products are sold and marketed primarily in metro cities. Even state capitals like Raipur and prominent cities like Nagpur have only one authorised outlet each. If Apple thinks that smaller cities means limited buying power, then they need to fire their market research team. There is a big market in our second wing cities, maybe even bigger than the popular names.
The coming weeks can be crucial for Apple’s future in India. Whatever the immediate outcome of these meetings, we know that Apple is just getting started here and has a long way to go. And while the big shots discuss and debate issues, we can only hope that this meeting will be major step towards India getting due importance from Apple. Fingers crossed!