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MacRumors
Oct 18, 2012, 03:22 PM
http://images.macrumors.com/im/macrumorsthreadlogo.gif (http://www.macrumors.com/2012/10/18/apple-looks-to-distributors-to-expand-iphone-sales-in-india/)


The Wall Street Journal reports (http://blogs.wsj.com/indiarealtime/2012/10/18/in-india-apple-shifts-iphone-strategy/) that Apple is on the verge of a significant expansion of its iPhone sales effort in India, bringing on two large distribution companies to help bring the device to more points of sale. The iPhone has so far been available almost exclusively through mobile phone carriers in the country, but with the iPhone 5 reportedly launching next week (http://www.macrumors.com/2012/10/09/next-round-of-iphone-5-launches-coming-october-26-with-india-and-malaysia/), the company appears to be significantly expanding its operations.A person who has knowledge of the plans says Apple will begin selling the iPhone through specialized distribution companies in an attempt to reach a wider audience, especially Indians who live in thousands of smaller towns.

The Cupertino, Calif. company has recently tied up the local operations of Ingram Micro Inc., a large U.S.-based distributor of technology, and Redington (India) Ltd., a local distributor with 12,000 smaller partners across the country, the person said.Apple has existing relationships with the two distribution companies, using them to offer products such as the iPad but reportedly having held the iPhone back from them for fear of eating into profit margins.

http://images.macrumors.com/article-new/2012/10/iphone_5_coming_soon.jpg
But with Apple's share of the mobile phone market in India falling by half year-over-year to 1.2% in the second quarter, the company may now be willing to sacrifice some profits in an effort to bolster its position in the country. Still, analysts believe that Apple's market share will remain low there given the premium pricing and the fact that over 70% of phones sold in the country are priced at under $100.

While Apple has been most heavily focused on China among emerging markets, there have been signs that the company is looking at the possibility of expanding its presence in India. Earlier this year it was reported that Apple was looking at opening retail stores (http://www.macrumors.com/2012/01/20/apple-retail-stores-coming-to-india/) in the country, but requirements for domestic sourcing of materials appear to be hindering those plans. In the absence of Apple-owned retail stores, the company earlier this year was also hiring staff (http://www.macrumors.com/2012/03/30/apple-planning-significant-growth-of-reseller-network-in-india/) for an effort to expand its reseller network in the country.

Article Link: Apple Looks to Distributors to Expand iPhone Sales in India (http://www.macrumors.com/2012/10/18/apple-looks-to-distributors-to-expand-iphone-sales-in-india/)



illegalprelude
Oct 18, 2012, 05:19 PM
While market share is nice, as Apple has previously shown, they care more about profits than a number which is what I believe in as well. With that said, Apple does have lower priced phones like the 3GS and 4 that they could offer there. If most people prefer a under $100, than offer them that, not your flagship phone.

colbertnation
Oct 18, 2012, 05:53 PM
Hey Eric Slivka, Arn, and MacRumors team,

I think it is important to mention in your articles about India and China some absolute numbers, on top of relative percentage numbers. While it is true that 70% of the phones sold in India are priced under $100, that also means that 30% of the phones sold are priced above $100. 30% might not seem like a lot, but if you put that in absolute terms, that represents 75 million handsets in India. (Source: Rediff Business article (http://www.rediff.com/business/slide-show/slide-show-1-tech-mobile-handset-sales-to-boom-in-india/20121011.htm)).

Also, it might be beneficial to include absolute population terms. If we assume that the iPhone 5 16GB version (being sold at say $800) is only affordable to say 3% of the total population of India, then it will not seem that much. To many uninformed people, it will simply be "3%?! That's it?! Why bother."

But in absolute terms, 3% of the Indian population represents 33 million people.

That's a potential customer base that can rival most European countries, only if looked on an absolute number scale.

That's why, my humble opinion is that MacRumors should include absolute numbers when talking about the two heavily populated countries like India and China. Thanks!

bitcloudrzr
Oct 18, 2012, 07:00 PM
Hey Eric Slivka, Arn, and MacRumors team,

I think it is important to mention in your articles about India and China some absolute numbers, on top of relative percentage numbers. While it is true that 70% of the phones sold in India are priced under $100, that also means that 30% of the phones sold are priced above $100. 30% might not seem like a lot, but if you put that in absolute terms, that represents 75 million handsets in India. (Source: Rediff Business article (http://www.rediff.com/business/slide-show/slide-show-1-tech-mobile-handset-sales-to-boom-in-india/20121011.htm)).

Also, it might be beneficial to include absolute population terms. If we assume that the iPhone 5 16GB version (being sold at say $800) is only affordable to say 3% of the total population of India, then it will not seem that much. To many uninformed people, it will simply be "3%?! That's it?! Why bother."

But in absolute terms, 3% of the Indian population represents 33 million people.

That's a potential customer base that can rival most European countries, only if looked on an absolute number scale.

That's why, my humble opinion is that MacRumors should include absolute numbers when talking about the two heavily populated countries like India and China. Thanks!

33 million, that's the entire population of Canada, which certainly buys a lot of iPhones.

lee14160
Oct 18, 2012, 07:54 PM
With other a billion possible customers Apple really needs to look in finding a way to tap that base. Sometimes you just have to start out low then work your way up once you have the customer base eating out of your hand. . .U.S. is a great example. . .:)

zosokm
Oct 18, 2012, 08:27 PM
Apple has to lower it's prices for India to capture the market. Although Iphone is a premium product and many buyers don't mind paying more it is ridiculous to pay more than what is paid in the US when you consider that India is still a developing country. I bought my iPhone 4 2 years ago for 650 $ in India. However with the release of the 4S ( which was priced at 850$) , the iPhone 4 price was increased to 700$ for a lower model(8gb)!!

Currently iPhone 4S is more expensive than the more recent Samsung Galaxy S 3. Samsung has 51% market share where Apple has1%.

Apple should bear the currency exchange fluctuations and try to keep prices reasonable ( even if is around what they charge in the US- but not 20-30% more)

Unfortunately carriers do not subsidize iPhones like the US

If Apple prices the iPhone 5 smartly I would still buy it .

smdc76
Oct 18, 2012, 10:00 PM
Leave India to Nokia(Micro****) and Google. That's not a market worth pursuing. The country doesn't get quality, and the only ones I see buying this are status conscious rich kids and their daddies, and that's a handful of them left in India cos most of them have already flown the coop.

joelvega125
Oct 18, 2012, 10:17 PM
How about we make a phone with a screen bigger than 4 inches of. I'm glad I switched to a bigger gs3. Tired of apples crap.

aziatiklover
Oct 18, 2012, 10:28 PM
This piss me off! Why go else where! When you can't barely have supply for your own market in the US! :rolleyes: it has been 5 days now that i've been trying to get another iphone 5!

arjunj
Oct 18, 2012, 10:52 PM
Leave India to Nokia(Micro****) and Google. That's not a market worth pursuing. The country doesn't get quality, and the only ones I see buying this are status conscious rich kids and their daddies, and that's a handful of them left in India cos most of them have already flown the coop.

*applause* Where else do you see such wisdom, ladies and gentlemen?

I would like to thank you, kind sir, for taking the time out of your undoubtedly busy schedule to impart us lesser mortals with some much needed knowledge.

I could have sworn that India was one of the largest markets in the world for anything premium and seeing that every second person here seems to own something from the Apple product line, I would've considered it a massive untapped market for Apple. But obviously I was wrong - as you've told us, the country just doesn't get quality, right?

KiwiAdventure
Oct 19, 2012, 12:40 AM
How about Apple supplying the market they have. It's still 3- 4 weeks for supply:confused:

Ramchi
Oct 19, 2012, 12:49 AM
India is not an easy market for Apple. In India people either adore or dethrone brands. Most of the times purely based on COST.

Talk to any business man to the common man who normally uses mobile phones, no one will spend Rs 50,000 for a mobile phone, not even for a Laptop, not even for an iPad!

Apple is neither Mercedes nor Nokia! Nokia catered to almost all segments. Where they failed was in touch screen; even when Sony Ericsson was successfully pushing its P990 etc...Nokia failed to see the light

If Apple is like Merc (out of reach for 99.99%) Indian elites with lots of stashed money will let it out - like someone mentioned rich spoil brats who have enough daddies' money to spend.

Indian regulations are slightly strange and may not work for Apple if they do not believe in bribery! Inspite of that Apple is doing a great job and what they cater now is what they can in India considering all the limitations.

BC2009
Oct 19, 2012, 01:25 AM
How about we make a phone with a screen bigger than 4 inches of. I'm glad I switched to a bigger gs3. Tired of apples crap.

How about you stay on topic, I'm tired of this "bigger is better" crap. If you wanted bigger you should have got a decent phone like the HTC One X. At least the One X does not flex and creak in your hand when you grip it. Also the One X has a better display by a wide margin. Either way if you really switched from iPhone to GS3 (assuming you are not just making this up and trolling) and you actually liked your new phone then why bother posting? All these supposed people who "left Apple and haven't looked back" just can't seem to leave Apple alone. Yet JD Power customer satisfaction surveys say 94% of iPhone owners intend to buy another iPhone. Somehow the plethora of forum posts like these doesn't match up with reality. I suppose the entire 6% who are dissatisfied with Apple all have MacRumors accounts. :rolleyes:

japanime
Oct 19, 2012, 01:40 AM
Softbank, one of Japan's two carriers to officially offer the iPhone, recently announced a "trade-in" program in Softbank will buy back and then unlock customers' iPhones. These unlocked iPhones will then be sold by Softbank in overseas markets.

My guess is that India will be one of the major markets for these refurbished iPhones.

What's unfortunate is that Softbank continues to refuse to unlock iPhones for use by their own customers right here in Japan.

hrishidev
Oct 19, 2012, 01:51 AM
How about you stay on topic
I suppose the entire 6% who are dissatisfied with Apple all have MacRumors accounts. :rolleyes:

Good one. Irrespective of topic , some Apple hating people just divert it to Apple Vs Others. Especially on forum dedicated to Apple

kshitijshah
Oct 19, 2012, 02:11 AM
Leave India to Nokia(Micro****) and Google. That's not a market worth pursuing. The country doesn't get quality, and the only ones I see buying this are status conscious rich kids and their daddies, and that's a handful of them left in India cos most of them have already flown the coop.

Is it a surprise that Samsung launched India on Day One. Nokia has India on priority list. India will drive growth for any sensible country in the world. The profit margins in India for Samsung are far greater than the rest of the world. That addresses Apple's focus on profitability.

vivferrari
Oct 19, 2012, 04:20 AM
Leave India to Nokia(Micro****) and Google. That's not a market worth pursuing. The country doesn't get quality, and the only ones I see buying this are status conscious rich kids and their daddies, and that's a handful of them left in India cos most of them have already flown the coop.

Nothing could be further from the truth. I am sure that if the iPhone cost 900 dollars in the US, Apple would not sell more than a few hundred thousand of them. Its dead cheap in the US due to subsidies by telecom companies and hence it sells.

----------

First of all the article is poorly researched. The issue that Apple faces in India is not not distribution, its pricing and partnerships. Steve Jobs busted his ***** in order to bring the telecom companies around, they just do not have the same kind of commitment when it comes to India. That is the bottomline.

hrishidev
Oct 19, 2012, 04:24 AM
This piss me off! Why go else where! When you can't barely have supply for your own market in the US! :rolleyes: it has been 5 days now that i've been trying to get another iphone 5!

Firstly Apple is global company. So every country is market for Apple. People in other countries always wait longer for availability for iPhone than US people. US citizen do get some preference while buying

If Apple waits longer to supply iPhone 5 in other countries ,people buy them from gray market at higher prices. These phones in gray market are bought in US and sold at higher prices. Because of which following are implications
1) There is increase in demand in US market
2) Apple loses profit which it can make buy selling using own distribution
3) Customer have to buy phone at higher prices making them unhappy or they opt not to buy iPhone.

Nobody except middlemen win.

When Apple serves other countries
1) Demand in US is because of consumers & not middlemen
2) Apple makes profit in distribution
3) People can wait for 15 days than paying more or sometimes double price.
(You can try in gray market of India for iPhone 5 , price is 100K Rs which is double than estimated price 50K Rs )

IGregory
Oct 19, 2012, 05:18 AM
I think the Indian population is more concern about their every day standard of living than a cell phone.

Jibbajabba
Oct 19, 2012, 06:02 AM
One problem with cheaper phones is the internet - if Apple sells at a lower margin - that is one thing, if they would lower the price, anoher. If he latter happens then expect tons of iPhones showing on up eBay which will be shipped from India.

Winni
Oct 19, 2012, 06:31 AM
I think the Indian population is more concern about their every day standard of living than a cell phone.

I think you should travel the world first before you make wild assumptions based upon what you saw on underclass TV.

bushido
Oct 19, 2012, 07:50 AM
not surprised, BlackBerry still rocks India at least thats what i noticed earlier this year

kamalds
Oct 19, 2012, 08:04 AM
I am an Indian

Went to maket to buy a phone for my sister. Wanted to buy an iPhone but costs over $1100 so went for GS3 that retails at $600.

I use Note 2 btw.

iphoneclassic
Oct 19, 2012, 09:10 AM
Leave India to Nokia(Micro****) and Google. That's not a market worth pursuing. The country doesn't get quality, and the only ones I see buying this are status conscious rich kids and their daddies, and that's a handful of them left in India cos most of them have already flown the coop.

US iPhone sales are only 30%.

I read an article where people preorder IP5 in Dubai and travel to India to sell. There are reports of people paying $2500 for 64Gb model.

Apple is going to sell 16GB for $800. We don't know how much AT&T/Verizon/Sprint actually paying Apple. Best estimate is between $449-$649. So Apple will make more profit selling unlocked phones.

You misunderstood about quality consciousness in third world countries. Apple cannot get away with "Scratches are normal on aluminum" story in China or India.

zosokm
Oct 19, 2012, 10:27 AM
Indians are willing to pay a premium for Apple just like people all over the world are. But why should they pay 50-100% more than what people in other countries are paying? I bought an iMac 21 inch which is 1199 in the US for 1299 in India. But to pay 900-1000$ for a phone that's selling for 650 in the US is too much. I'm sure Apple would not sell the same number of phones in the US if you could only buy them unlocked for 900$!

vseera
Oct 19, 2012, 10:38 AM
I am glad most of the commenters in this thread at least have a vague idea about India and the Indian market.

While the percentages may seem low, the numbers speak for themselves. 3-5% of the Indian population would be much bigger than most European countries.

Most of the people, specially in the big cities, can afford between 1-2 cars, a house (owned or rented) and a decent living condition. A large percentage of them are debt free. And this is just the middle class.

The upper middle class, or the relatively well off, routinely take trips all around the world. Have about 2-4 cars in their owned houses, have chauffeurs to drive them around and at least 2 servants in the house. Home theatre systems and big screen TVs, etc are all very well the norm. And these people are willing to pay whatever it takes to get the latest gadget in their hands!
Or the latest designer brand. And that is the reason why almost all of the designer brands recognise India as a huge market and have invested huge amounts of money in the very expensive real estate market to open shops.

Khan Market, in Delhi, is one of the most expensive high streets in the world:
http://articles.economictimes.indiatimes.com/2009-09-22/news/27649412_1_delhi-s-khan-market-expensive-shopping-destination-hong-kong-s-causeway-bay

The potential for a freely available iPhone to be popular is huge! Specially as a lot of people I know have already paid over $2000 for one to be the first to have it in their hands.

India is also all set to be the largest retail market in the world in the coming years.

Honestly, I am not sure what the popularity of the iPhone would be if people in the US were expected to spend $800-900 on it instead of the measly upfront amount they spend right now.

JAT
Oct 19, 2012, 11:18 AM
33 million, that's the entire population of Canada, which certainly buys a lot of iPhones.
Oh? You guys get phones, now?

hakuna-matata
Oct 19, 2012, 11:41 AM
India: post iPhone 5 prices of all phones:

iPhone 4 (8 gb) - 550$
iPhone 4s(16gb)- 780$
iPhone 5 (16gb) - 889$

Samsung Galaxy S3 - 629$
Samsung Galaxy Note 2 -694$
Htc One X (16 gb) - 589$

^^^daa fuq is wrong with apple when it comes to pricing in India?? Do they go full retard or something??

Notice the difference between HTC One X and 2 year old iphone 4 (8 GB version)

DevilInDisguise
Oct 19, 2012, 05:55 PM
Price is the main issue. pricing a phone above 40K is crazy.. and we're gonna see the iphone 5 launch around 45-50k.. who the hell wants to pay half a lakh on a phone!! Price it decent like the S3 or the HTC one X, and it will sell a lot!! both the s3 and htc one x launched under 40k. around 37k i believe, which is what many are ready to pay right now.. not above 40k!! Apple wants to remain arrogant with its pricing, let it be. Its just gonna see lesser sales.. no one is gonna buy an iphone 4 or a 4s when the 5 is out already. India wants the latest phones at decent prices.. sell the iphone 5 here at 39900 and it will sell a million!!

SWPROX
Oct 19, 2012, 11:31 PM
Well,regarding India,and it's population,it is true that 70% of the population struggles for basic facilities,poverty is abundant,but the 10% middle class (100 million) and 1% upper class (10 million) provide ample business oppurtunities for companies,and corporations are not interested in that 80% poor population,they see those top 10% or so,and the number are large enough to attract them.Cities like Delhi and Mumbai have some of the largest slums in the world for sure,but because of sheer population,even that 5% of the rich create a substantial market demand.....and yes I have lived in India for 18 years,and am a human geography major,so I guess I kinda have some info-no offence to anyone,my apology if someone felt offended :).

masti13harsh
Oct 20, 2012, 01:36 AM
make iPhone 5 less than 40k and take my money straight away.....
I bet that the sales will reach sky rocket in India if Apple decreases its prices by 5k($100) on every product...

Ramchi
Oct 20, 2012, 01:48 AM
Apple do not need to do any special favour for Indians who can buy premium products at a decent price levels.

Let Apple sell iPhones in India with the same price that of USA including taxes(@Rs 48 per USD exchange rate unchanged) you can see the difference in your sales figure.

iKaushal
Oct 20, 2012, 09:11 AM
The problem with previous iPhone releases here in India was the price. Even though when the iPhone 3G, 3GS & 4 were released tied to the mobile operators, they didnt subsidise the phone a bit. Also their iPhone specific talk plans were a rip off or day light robbery.

With iPhone 4S Apple started to sell via operators frirst and then later via its authorised resellers, but again the prices were kept very high.

This has prevented the high penetration in Indian market.

If the iPhone was released like in USA at $199 (INR 11,000) tied to an operator, then it would had captured the marked and outsold any other smartphone here.

Sadly that was not the case...and hopefully Apple will rectify this problem by selling atleast the unlocked handsets with prices at par with Global unlocked handsets.

The earnings of most well educated Indians atleast in metros is pretty good and they can easily afford unlocked iPhones even at current sky high prices. i've seen lots of people with iPhone in India although their ratio compared to Android or BlackBerry is low. But with competitive prices from Apple, this will soon change.

I've used every model of iPhone from 2G to 4....skipped the 4S and now waiting to buy the 64 GB iPhone 5 on launch day.:apple:

SWPROX
Oct 20, 2012, 12:43 PM
Apple do not need to do any special favour for Indians who can buy premium products at a decent price levels.

Let Apple sell iPhones in India with the same price that of USA including taxes(@Rs 48 per USD exchange rate unchanged) you can see the difference in your sales figure.

The exchange rate is Rs 54/$ and been there for quite some time now.

Ramchi
Oct 21, 2012, 03:09 AM
The exchange rate is Rs 54/$ and been there for quite some time now.

It nose dived to Rs 35-36 at some point during 2009-2010. Ideally it should be around Rs 40-45 range. I have included the markup for correction as well

DevilInDisguise
Oct 21, 2012, 08:52 AM
The lowest the $US ever went to was Rs.39.11 in 2008

source - http://www.xe.com/currencycharts/?from=USD&to=INR&view=10Y

iKaushal
Oct 21, 2012, 02:24 PM
The lowest the $US ever went to was Rs.39.11 in 2008

source - http://www.xe.com/currencycharts/?from=USD&to=INR&view=10Y

I remember shopping a lot in 2008 during my USA holiday :p :D

crkishore
Oct 22, 2012, 11:11 AM
Apart from the chinese vendors, there doesnt seem to be any phone which would work in the 2.3GHz LTE band. iPhone5 would be one more phone to that not-useful-for-LTE list.:(

tharitm
Oct 22, 2012, 11:05 PM
Apple should focus more on bringing the prices down in the developing countries rather than spreading their stores. Even if they spread the devices to every inch and corner in the country if the device is priced $600 more than the price in the US and costs over $1000 I am sure people will just skip it.

I am planning to get a MacBook Pro it costs $1199 in the US and for me its $1465. I know Apple has no control over taxes and etc. but they should at least sell their devices to the re sellers at a lower price than they are usually selling so the consumers wouldn't have to pay a huge amount extra.

Prices in Sri Lanka.

kdarling
Oct 22, 2012, 11:38 PM
-- iPhone sales have always been small in India

The first year the iPhone was available in India, only about 50,000 were sold.

Things have improved a bit since then; now Apple ships about that many to India each quarter, but ~200,000 a year is still nothing in a country with 900 million cell phone users.

(Apple ships more than that to Norway or Belgium or Israel... countries with 1/100 the number of cell users.)

-- For that matter, smartphones sales aren't that big

Total smartphone sales were 2.7 million units during 1Q12.

Of those, Samsung sold 40%, Nokia 26%, RIM 12%, Apple maybe 2%.

If Apple is really going after India (and all the other countries where inexpensive phones rule), Cook must have some plans to make either much less profit, or far cheaper models.

jaihindhreddy
Mar 26, 2013, 11:26 AM
I really couldn't resist posting this after seeing all those people say that India basically is a bunch of people that are not fit for apple. And this sadly(to them) is far from the truth. Apple is actually very valued and it is actually the perfect country to get a huge fan base for Apple. What I'm saying is, if Apple opens it's own retail stores, prices will drop and then Apple can easily gain a lot of iSheep that are just gonna buy anything and everything that they release. I've seen people spending upwards of 3200 USD for a BASELINE Retina MBP! Of course this is because of the c*rrupt govt that Apple isn't able to open it's stores. According to Indian rules, if a company wants to open single brand stores, 30% of all that stuff must be sourced from India which just can't be done. But the problem is the prices & the stupid rules but not the society or the people.:apple: