Samsung, Apple lead India's rising smartphone 'premiumisation' trend

The market shift towards higher-priced smartphones is being supported by aggressive EMI offers, AI features and trade-ins, reflecting growing consumer willingness to invest in premium devices, according to Counterpoint

By Harichandan Arakali Forbes India Staff

Published: Nov 11, 2024 01:08:41 PM IST

Updated: Nov 11, 2024 01:16:00 PM IST

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The Smartphone market is increasingly shifting towards value growth, fuelled by a premiumisation trend Image: Punit Paranjpe / AFP

India’s smartphone market grew 3 percent year-on-year in calendar Q32024, with value surging 12 percent, a record, driven by a “premiumisation” trend, according to preliminary data from Counterpoint Technology Market Research’s latest India smartphone tracker.

The first growth rate number refers to the increase in the number of phones sold in the market during the July-September period versus the same quarter a year ago, whereas the second refers to the value of all those phones based on their retail prices. The much bigger increase in value reflects the shift towards the premium end in the mix of handsets sold.

Samsung led the market in value with a 23 percent share, prioritising its flagship Galaxy S series and integrating AI features into its mid-range models, according to Counterpoint.

“The market is increasingly shifting towards value growth, fuelled by a premiumisation trend,” Counterpoint’s senior research analyst Prachir Singh wrote in the monthly smartphone tracker note, dated October 29. Samsung’s strategy of making more AI (artificial intelligence) features available in its mid-range phones such as the A series is encouraging consumers to upgrade, he added.

Apple followed closely with a 22 percent value share, bolstered by strong shipments of the iPhone 15 and iPhone 16. The brand’s push into smaller cities and its aspirational image have strengthened its position as the top choice for premium buyers in India, the analyst added.

As to volume growth, “during Q32024, several sales events were hosted by both OEMs and channels. These included parallel offline campaigns, which helped some of the OEMs clear existing inventory”, research analyst Shubham Singh said in the note. This, in turn, helped them to offer multiple new handsets ahead of the festive season, he explained.

The market shift towards higher-priced smartphones is also being supported by aggressive EMI (monthly instalments) offers and trade-ins, reflecting growing consumer willingness to invest in premium devices, according to Counterpoint.

Also read: AI is boosting smartphone sales worldwide: research

Apple in India

Meanwhile, Apple CEO Tim Cook confirmed recently that the iPhone maker will soon open more company-owned-and-run retail stores in India.

The step up in India and other emerging markets reflects Apple’s changing global market landscape. In China, it is facing stiff competition from local smartphone companies and in the EU, it faces scrutiny for non-compliance with the bloc’s strong anti-monopoly rules, including the Digital Markets Act.

Apple reported its fiscal fourth-quarter results on October 31, revealing a decline in sales in China, signalling potential market saturation amid rising competition from local brands such as Huawei and Xiaomi. The company grew in every other market.

In the 12 months ended September 28 (Apple follows an October-September financial calendar), sales in what Apple refers to as Greater China fell 7.7 percent from $72.5 billion in FY23 to $66.9 billion in FY24. In Apple’s reporting, Greater China includes mainland China, Hong Kong and Taiwan.

Apple doesn’t provide a region-wise breakdown of device-specific sales. Overall, iPhones account for just over half of Apple’s total revenue (net sales). The rest is made up of iPads, Mac computers, wearables, and the company’s strong services segment.

Cook, speaking to analysts on the earnings call, noted an all-time high in Apple's active device base, with the company holding the top two smartphone sales in what he called “urban China”, meaning typically the more densely populated and economically advanced Tier I and II cities.

Overall, Q4 sales in Greater China, Apple’s third-biggest market, were about $15 billion, falling only marginally by about $51 million year-on-year. Sales were higher 2 percent sequentially versus the June quarter. India, while growing strongly, is a small market in comparison, which Apple clubs within its Europe segment along with the Middle East and Africa.

Apple set another sales record in the September quarter. CEO Cook also said Apple plans to open four more stores in India. These will likely come up in Bengaluru, Pune, Delhi-NCR, apart from a second store in Mumbai, Moneycontrol reported on October 4. Apple opened its first company-owned retail stores in India in Mumbai and Delhi, in 2023.