Apple Plans Revamped India Strategy With Official Stores, Year-Long iPhone Deals, and Improved Apps

Discussion in 'MacRumors.com News Discussion' started by MacRumors, Aug 6, 2018.

  1. MacRumors macrumors bot

    MacRumors

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    Apple's ongoing struggles in India have been scrutinized repeatedly over the past few years, and today a new report by Bloomberg has looked into Apple's plan to stay afloat in what's considered the world's "fastest-growing smartphone market."

    In an effort to revamp the company's presence in India, Apple CEO Tim Cook is believed to be working behind-the-scenes to "remold Apple's failing India strategy," according to both current and former Apple employees. This plan was kicked off when Apple executive Michel Coulomb began overseeing the company's India strategy at the end of 2017.

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    According to the new report, this strategy includes better and longer-lasting retail deals with higher sales targets, the opening of official Apple retail stores in India, "overhauling" the company's relationship with independent retailers, and improving apps and services "aimed more closely at Indians." This last point particularly includes a "revamped" version of Apple Maps that is aimed to launch by 2020.

    On the point of services, earlier this year Indian iPhone users discussed Apple's poor performance in this area and one user specifically called Apple Maps "a joke" in the country. While some services like Apple Music were favorably received, others like Siri were identified as low points for Indian customers, as the assistant "often struggles" with local accents and does not understand "many words of Indian origination."

    For retail, the official Apple stores are said to open in 2019 and eventually include locations in New Delhi, Bengaluru, and Mumbai. While the Indian government's rules for foreign companies opening shops have previously prevented Apple from launching local stores, the company now builds some of its iPhone SE and iPhone 6s models in India, which is believed to help it meet India's rule requiring these companies to manufacture 30 percent of their products locally.
    In the Indian market, Apple ranks 11th and accounts for just one percent of India's phone sales, selling fewer than one million iPhones during the first half of 2018. Comparatively, rival smartphone maker Xiaomi sold "more than 19 million" during that period, according to data gathered by Counterpoint Research.

    As usual, much of the conversation surrounding Apple's disappointing performance in the country is due to its higher smartphone prices in comparison to the company's peers in India. Nagaraja B.C., the manager of a local smartphone store named Poorvika Mobile World, said that his average shopper's budget is "about 10,000 rupees," or $150.

    Apple's cheapest model in the market, the locally-made iPhone SE, is nearly twice that price, leading many customers to opt for smartphones like the Xiaomi Redmi 5A at $100. As part of the new strategy, Apple is said to be in talks with retailers and banks to "offer holiday deals year round" to convince customers to purchase its smartphones.

    Article Link: Apple Plans Revamped India Strategy With Official Stores, Year-Long iPhone Deals, and Improved Apps
     
  2. ipponrg macrumors 6502a

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    Sounds like a winning strategy. Make local retailers and banks eat the cost of the iPhone because Apple doesn't want to cut the cost of it. And this entire time, I thought everyone here was saying Apple should be content with targeting those with income.
     
  3. TheShadowKnows! macrumors 6502

    TheShadowKnows!

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    #3
    Cook's retooled sale strategy for the Indian market, using installment loans:

    Less cost than "one cup of chai a day"/s
     
  4. FrenchRoasted macrumors regular

    FrenchRoasted

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    #4
    As we will find out here in the US, trade protectionism doesn't work. Ultimately it just raises costs and empowers the politicians.
     
  5. mtneer macrumors 68030

    mtneer

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    Has anyone articulated why Apple "needs" to be in the Indian market, if the people there are too poor to be able to afford Apple products? Lack of price discipline and tendency of consumers to haggle show that this is still a primitive market.
     
  6. avtella, Aug 6, 2018
    Last edited: Aug 6, 2018

    avtella macrumors regular

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    There is still a pretty large Upper Middle Class/Upper Class population that could afford high end phones in raw numbers though it may seem tiny percentage wise. Even let’s say hypothetically 60-80 Million potential customers who can afford to buy high end units out of ~1.4 Billion that’s still a lot in terms of raw numbers. The middle and upper middle class is still expanding, from some 260 Million in 16 expected to hit 470+ Million by 30. Also there is room for growth vs comparative saturation in the high end market in more developed places.

    I’m sure Apple has looked at demographics, rising income levels and upper middle class population statistics and growth projections just like other manufacturers.
     
  7. 69Mustang, Aug 6, 2018
    Last edited: Aug 6, 2018

    69Mustang macrumors 603

    69Mustang

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    Because the rest of their markets are either close to maturity, or mature and slightly stagnant. There's not much growth currently. Offering higher priced skus, while potentially providing more revenue, won't help with growth. Apple thinks India is s burgeoning market that will help with growth. With a ~1% market share, there's plenty of room for growth. It's just going to have to be growth that mixes flagship and mid tier offerings.
     
  8. Madhava macrumors member

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    #8
    Finally some good news for Apple loyal customers in India and looks like they are working in right direction.
    If they open Apple Stores that will build confidence to buy an iPhone/iPad/watch/airpods which is currently lacking applecare and authentic service options.
    Also if the upcoming dual sim iPhone is available in India it would definitely be great for growth.
     
  9. Anandc macrumors regular

    Anandc

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    #9
    I'm from Bombay, India.

    I have owned Apple products for decades from MacBook Pro to iPhones. I was even an Android user buying flagships smartphones of Sony.

    For any luxury brand/company to pitch higher sales needs a very strategies pricing. iPhone X in India cost about 1300USD. That's a very steep price even for the Americans. But as long as you have a good middle income and high income market, it's still affordable. But in India, even if they have the money, they will still buy OnePlus or any other Chinese brand because they're getting everything or even more at half the price. And for many people this makes sense in India.

    Apple doesn't need to change anything. It just needs to get all it's features down here.

    Apple Pay - There's no Apple Pay. In India, Android phones can do NFC payments but iPhones can't. Imagine you have a USD1300 smartphone and you can't do NFC payments while those cheap 300-500USD can do NFC payments.

    Apple Maps - We know Apple Maps have 3D Maps and turn-by-turn navigation but nothing is here in India. It's a waste. Specially Apple CarPlay doesn't support Maps turn-by-turn navigation.

    Siri - Siri is as dumb as it can be in India. It doesn't let you book tables in restaurants, it doesn't tell you the movie timings, no regional language support etc.

    Apple Stores - This is needed. It connects the customers straight to the brand. It's a different experience buying the phone from it's flagship store rather than some shop. Think of this in a way where you would only like to buy a car from it's showroom and not from anywhere else.

    Apple TV App/Apple News App - We don't have these apps. I don't know why!

    Surprisingly, Apple has not left only India but also many many countries without it's key features.

    If you are not from US or UK, you are probably missing some features for sure. That's where Apple needs to understand that customers are ready to pay and the sales are the fact that people are still buying without having all the features but Apple took India for granted and they paid the price for it.

    And let me tell you, India loves iPhones. They're crazy over smartphones and they totally believe iPhone is the god of all. The problem is not the pricing, it's the justification of pricing. If I am paying 1300USD, what am I getting back?

    Look at Vivo Nex, OnePlust 6T, Huawei P20 Pro etc. These smartphones are simply copying iPhone X and selling at half the price with all the features available for the user.

    If iPhone wants the market share, it needs to do more than what these Chinese brands can't do. And that's not just India but everywhere, even in US.
     
  10. m0sher macrumors regular

    m0sher

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  11. mozumder macrumors 6502a

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    #11
    So, they decided to go ahead and pay bribes to Indian officials to get their retail permits?
     
  12. ilikewhey macrumors 6502

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    #12
    nfc is pretty big in asia including india, idk how long apple can keep up with not having nfc in their phones, when i was using my samsung s6, anything with a card swipe works with samsung pay. that is one feature i definitely miss since i switched back to iphone.
     
  13. KPandian1 macrumors 6502a

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    #13
    Will it be up to you to define what a primitive market is and then explain why such a market should not be allowed to own Apple products?

    Price discipline and haggling - have you seen the stock market, arms purchase/sales, cars' purchase price (new and used), gun sales in pawn shops and gun-shows, etc., in the USA?

    People who can pay $25-50/month are buying iPhones, $3000/month are buying $750-1000K houses, and so on, by spreading the payments over 24 months or 50 years, here in the USA. Are these in the responsible, disciplined purchase spectrum, or do you not want the Indians to have such "privileges"?

    Those who can afford the monthly payments and the see the value in the commodity will purchase said items; India, Russia, USA or Haiti.
     
  14. FightTheFuture macrumors 6502a

    FightTheFuture

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    #14
    there are no Apple Stores in India?
     
  15. KPandian1 macrumors 6502a

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    No, not a single one.
     
  16. code-m macrumors 6502a

    code-m

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    #16
    You make a valid point, no point selling an expensive/luxury product if the company is unable to offer the services to make the product useful in the country it is trying to expand in. This seems like an oversight on Apples part.

    In Siri’s defence, it’s useless everywhere, Apple Maps is not that much better. Apple Pay has yet to be accepted globally, etc. The list goes on relating to services and support. I believe there is opportunity to expand.

    This is a major issue for Apple, if their are unable to sell its devices in India, there are very few developers who are willing to invest/support the AppStore as the market share is not lucrative. These developers will support AndroidOS and development will be in a competitors ecosystem initially. Apple needs to move fast, as Services is where it will make most of its profits from going forward.
     
  17. singhs.apps, Aug 6, 2018
    Last edited: Aug 6, 2018

    singhs.apps macrumors 6502

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    That’s a myopic, half arsed ‘primitive’ speculation. When the price point of an iPhone is about 40-57% more than what you get over in the US ( there too the complaints are about rising cost of new iPhones ), you think ‘haggling’ is the issue ?

    Add to this the fact that Apple services - maps/Siri/Apple Pay and such are ‘primitive’ where’s the logic in paying ~50% more for every Apple product and still get non existent service features ?

    Add again the fact that for a long while ( and perhaps still is ) your US iPhones are basically carrier supported EMI style of payments, which is virtually non existent in India.
     
  18. wigby macrumors 65816

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    All of your points are well taken but you keep mentioning features and justification for pricing. These things are not traditionally part of Apple's marketing strategy. With Apple, you pay a premium and get the Apple brand which includes quality, support, usability and the Apple ecosystem. The only time Apple mentions features is when they've updated them or added them to their newest products. They don't do comparative value against Android devices for instance so I don't see Apple changing their approach to India nor do I see them succeeding until India's middle and upper middle class grow sufficiently.
     
  19. DeepIn2U macrumors 603

    DeepIn2U

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    #19
    Besides looking at trajectory of ALL the countries in the globe ... looking specifically at their GDP ... you'll find the USA has actually been dropping consistently for decades except slight increases in the last few short years and it's only incrementally at best.

    People in India have been getting a taste of USA corporate jobs ... even while working for peanuts in currency conversion. Thousands have risen from what you would call "poor" to middle class FASTER than any other nation. Now what happens when a populace has income risen along with job security?

    - they either move to increase their wages and send money BACK home to family, or
    - they continue to earn, live humbly and soon save and invest exponentially.

    Ad to this bank accounts that are opened free with no interest for the first few years, and soon enough THEY'll be having profits and good wages the likes you've never seen happen so fast.

    Have you not seen the rapid tragedy of FORCED immediate arrange marriages from students and young men that have worked in the USA whom come home to visit families?!

    One concern I have with Apple is
    Apple has been trying to be within India for almost 3yrs now and STILL they cannot resolve this one aspect?! With crap like this NO executive including the CEO should EVER be paid ANY BONUSES until things are resolved. Siri's dire improvements are NOT limited by sales of devices within India nor by government restrictions!
     
  20. code-m, Aug 6, 2018
    Last edited: Aug 6, 2018

    code-m macrumors 6502a

    code-m

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    I am uncertain if you mistaken the persons concerns, without Apple related services there is no incentive to purchase an Apple product. Think of it as such, BMW sells a vehicle in India, claims it is a better experience/eco-system compared to competitors, however you cannot use the speed/power the vehicle can offer, cannot use the GPS, or other BMW only related services that contributes to the experience, does not have a BMW dealership to purchase, repairs, etc. However is willing to sell this expensive vehicle in India and then complains that it is not doing well.

    It has very little to do with affordability and more to do with incentive. Given that people replace their phones every 1-2 years, why would a local purchase an expensive phone with all these drawbacks compared to its competitors when Apple is not willing to make an investment in the Indian market for its services. I am not even going to bring up the issue of theft.
     
  21. JPack macrumors 68020

    JPack

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    #21
    This is the key.

    Due to limited income, Indians are looking for value products when Apple is a premium brand.

    We see the same problem with Mercedes-Benz - they’re only able to sell 15k cars in India. The population can’t afford it yet.

    Premium brands offer unique brand recognition and features. Asking Apple to bend down and be like Xiaomi will never happen. Certainly not to accommodate one country.
     
  22. Count Blah macrumors 68040

    Count Blah

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    #22
    most people in the US SHOULDN’T be spending $1,000 on a cell phone either, but they do it anyway. Apple is hoping to push the irresponsible behviour To the Indian market.
     
  23. JPack macrumors 68020

    JPack

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    #23
    Over 1 million iPhones were activated in China back in 2007. This was before Apple sold iPhone in China. These were grey market devices sold in the U.S. and shipped to China for a hefty profit. Back then, there was obviously no infrastructure to support iPhone in China.

    If the market can afford it, consumers will buy it. Right now, the Indian market cannot afford it.
     
  24. Radon87000 macrumors 604

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    Clearly there is money to be made if Cook is interested in something.
     
  25. bluecoast macrumors 6502a

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    #25
    Interesting to wonder what iPhones that Apple will promote as part of this strategy.

    If the current SE is still too expensive, I doubt that we'll see a SE2 with a notch anytime soon.

    I assume that when we get this year's iPhones the current SE and iPhone 6 will see further price cuts, making them more desirable for India (and I think this explains why Apple is really targeting iOS 12's performance improvements for these phones). Then presumably, as time goes on, we'll see the 7 series promoted more as it becomes cheaper and cheaper.
     

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