For a very long time, we’d assumed that Apple’s biggest problem in India was cost. If they covered that, they’d be set. However, recent reports from the Wall Street Journal suggest the problem is much bigger, namely Samsung India.
The problems from Samsung — largely in terms of huge investments — are causing a great deal of trouble to Apple, which is trying its best to establish a brand here in India. Apple Insider notes —
“Other than just battling the Indian government for concessions and dealing with the shaky financial situation of the populace, Apple is also fighting a large and aggressive Samsung presence in the country for the minds of the consumers.”
Samsung India already has a 27% market share, and while the number is huge in itself, it’s just humongous when compared to Apple India’s measly 3%. And now, Samsung has decided to pump in an extra $760 million into its Indian branch. This money is largely towards the construction of a new facility that will pop-up in the outskirts of Delhi-NCR.
Other headaches
Apple India is facing what can only be considered a Chinese invasion. Companies such as Oppo, Vivo, and OnePlus are eating into the smartphone market share at a rapid rate. Even Samsung is feeling the burn. But they do have the advantage of a cushion in the form of a firm grip over the mid-range smartphone market. What’s surprising is how cheaply the newcomers are able to price their products!
It’s not clear how much profit the other manufacturers make in the country. Analysts estimate that more than 75 percent of the phones in the country sell for less than $250, with 95 percent selling for less than $500. The overall average of all smartphones sold is estimated to be right around $150.
Apple India’s big push to fight this rising tide seems to be two-fold:
a) Manufacture iPhones in India, and
b) Set up Apple Stores.
Apple has already got a leg up on the first of these two. They have already started selling “Assembled in India” iPhones in Bengaluru. It’s not clear how it will impact their overall position in the market, though, because there hasn’t been any drop in price.
There is no doubt that Apple is facing a Samsung India problem. It’s also at odds with the local government and facing stiff competition from China. In light of all this, Apple will have to really step up its game if it has to gain some points in India.