New Delhi: Smartphone purchases are increasing drastically in India but it does not appear to be helping Indian brands. Chinese entrants including Vivo, Oppo, LeEco and Gionee have taken over the Indian market, which is evident as the smartphone sales in January-March quarter of the Indian brands have slowed down according to reports.
According to a research done by Counterpoint Research, all the new entrants from China are focussing on the offline market more aggressively than online. The Chinese smartphone makers are paying higher channel commissions for pushing their products, sometimes even doubling their expenditure on commissions by as much as 10 per cent.
As per the report, some Chinese brands are also spending anywhere between Rs 30,000 and Rs 31 lakh to mom-n-pop stores for redesigning their shop carrying their brand's name. Such branding through retailers is doing well for the company, Vivek Zhang, chief marketing officer at Vivo India told ET.
The report further notes that the money being pumped in by these Chinese companies has also resulted in higher marketing rates, especially in events like the India Premiere League, which has Gionee, Vivo and other smartphone brands part of promotions.
On the other hand, Indian brands such as Micromax, Intex, Lava and Karbonn Mobiles had slowing smartphone sales in January-March quarter, forcing them into marketing decisions. Karbonn Mobiles refused to spend money on IPL, while Intex Technologies bought the Gujarat Lions IPL team.
Counterpoint Research said the steps taken by the new entrants, especially Vivo and Oppo, to increase their share of the market is working. As of the quarter ended March 31, Chinese players had a 22 per cent share of smartphone sales, which is expected to increase to 25 per cent, said Counterpoint Research senior analyst Tarun Pathak.