Apple's Revamped India Strategy Includes 5-6 'Flagship Premium Reseller' Outlets in Major Cities

[MacRumors]

In an ongoing effort to boost sales in India, Apple is reportedly planning to upgrade its authorized reseller locations in five to six
"extremely prominent locations" in India's metropolitan cities. The stores are being referred to as "Flagship Apple Premium Reseller" outlets.

While not official Apple stores, the locations will each be "at least three times larger" than the current reseller stores, which average about 1,000-1,500 square feet (via The Economic Times).

According to three senior industry executives, Apple may go up to as much as 5,000 square feet for the improved reseller locations in an effort to build them as "anchor shops" in malls and high-traffic outdoor shopping areas.

Apple will reportedly start construction on the flagship outlets first in New Delhi, Mumbai, Bangalore, and Chennai. Sometime after those locations, the company will then open outlets in Hyderabad and Pune. A specific grand opening window for these outlets was not given.

"With company-owned Apple Stores yet to take shape in the country, Apple wants some of the franchisee run outlets to up the experience game through this new format. This is part of Apple's new India strategy to focus on selling on experience rather than discount," he said.

Apple is even open to the idea of a couple of these flagship stores being as large as 5,000 square feet if a suitable location is available. "The key is getting the right location, which is not easy. A team from the company is identifying locations," an executive said.

The outlets are part of Apple's revamped India strategy, which includes overhauling its relationship with independent retailers, long-lasting retail deals, and opening official Apple retail stores in the country. These official stores are said to open beginning in 2019 and eventually include locations in New Delhi, Bangalore, and Mumbai.

Apple's new strategy began when Michel Coulomb was hired to oversee the company's India growth at the end of 2017. Apple routinely struggles in the Indian market due to the higher prices of its smartphones in comparison to other manufacturers like Xiaomi, and other factors.

The other major aspect of the revamped strategy is Apple's services, which will be "aimed more closely at Indians" thanks to certain apps that will get major updates in the country, like a new Apple Maps coming by 2020. Earlier this year, Indian iPhone users discussed Apple's poor performance in this area and one user specifically called Apple Maps "a joke" in India.

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" -- all pain points that Apple is hoping to address.

Article Link: Apple's Revamped India Strategy Includes 5-6 'Flagship Premium Reseller' Outlets in Major Cities

 

[delhifox]

Whats new in this? Apple already has this kind of setup in India for sometime now..increasing square feet of retail doesn't help..

1/ Better service ? No
2/ Apple Pay ? No
3/ Reduces supply chain issues ? No
4/ Does it really help in reducing the cost of apple products ? NO!
5/ Improvement in maps? hell no!

 

[AvisDeene]

iPhones are just too expensive for those living in India. I don’t see them selling much of their products there for a while.

 

[asdavis10]

India just isn't ready for the brand of company that Apple is. Apple isn't going to offer special Indian versions of their products that sell at a cheaper price. Until the standard of living improves drastically for those billion people, Apple products are simply aspirational.

And the privacy/security issues with the government will make it a worse market than China to operate in. Apple at least makes money in China to justify the government issues.

 

[BvizioN]

When it comes to India, I think you Tim have 2 options.
1- Sell "$10 iPhones" (and allow spyware apps to be installed as requested)
2- Quit the market

 

[Capeto]

Tim, I heard India’s really jonesing for an SE 2 and an iPad Mini 5...

 

[aakshey]

e

Whats new in this? Apple already has this kind of setup in India for sometime now..increasing square feet of retail doesn't help..

1/ Better service ? No
2/ Apple Pay ? No
3/ Reduces supply chain issues ? No
4/ Does it really help in reducing the cost of apple products ? NO!
5/ Improvement in maps? hell no!

1. Not many Indians pay a premium for better service. They only care about objective metrics and features.

2. I don't think any Indian outside of MR has heard of it.

3. Please elaborate.

4. That's the opposite for what they are trying to do. They've already mentioned they want to sell at MRP only.

5. Everybody outside of MR is happy with Google Maps in India. They would never buy an iPhone for Apple Maps, no matter how good it becomes.

 

[pika2000]

iPhones are just too expensive for those living in India. I don’t see them selling much of their products there for a while.

Louis Vuitton sells handbags more expensive than cars, and they have stores in India as well.
[doublepost=1534864920][/doublepost]

When it comes to India, I think you Tim have 2 options.
1- Sell "$10 iPhones" (and allow spyware apps to be installed as requested)
2- Quit the market

Samsung just did pre-orders for the Galaxy Note 9 in India.
India is a huge (and growing) market. Only fools would skip the second most populous country in the world.
[doublepost=1534865059][/doublepost]

India just isn't ready for the brand of company that Apple is. Apple isn't going to offer special Indian versions of their products that sell at a cheaper price. Until the standard of living improves drastically for those billion people, Apple products are simply aspirational.

And the privacy/security issues with the government will make it a worse market than China to operate in. Apple at least makes money in China to justify the government issues.

The only disadvantage Apple has in India is local manufacturing (which they started working on recently) and the lack of features like dual-SIM. The likes of Samsung has established their factories in India long time ago, and thus have advantages in taxes and cost. Apple is quite late in Asian market outside China due to their focus on China.

 

[aakshey]

Louis Vuitton sells handbags more expensive than cars, and they have stores in India as well.
[doublepost=1534864920][/doublepost]
Samsung just did pre-orders for the Galaxy Note 9 in India.
India is a huge (and growing) market. Only fools would skip the second most populous country in the world.
[doublepost=1534865059][/doublepost]
The only disadvantage Apple has in India is local manufacturing (which they started working on recently) and the lack of features like dual-SIM. The likes of Samsung has established their factories in India long time ago, and thus have advantages in taxes and cost. Apple is quite late in Asian market outside China due to their focus on China.

1. If you ever study the financials of luxury brands like Louis Vuitton in India. Firstly, the sales are a rounding error in the global context. Many of these brands are often loss making and investing for the future. Sometimes, the brands are profitable but charging a 2-4x multiple in India, something which Apple isn’t doing in India.

2. It’s a growing market. But not a big market yet. The number of smartphones over USD 500 sold in a year are probably below 10 million units. That’s again not a big number in the global context. The only thing on India’s side is that it’s a growing market whereas most of the world is declining.

3. Yes, if Apple does local production in India, they can reduce their prices significantly. And I want them to do that too. I’m not sure what’s stopping them though.

 

[BvizioN]

Samsung just did pre-orders for the Galaxy Note 9 in India.
India is a huge (and growing) market. Only fools would skip the second most populous country in the world.

Taking pre-orders and being successful are 2 different things. In India is mostly cheap Chinese phone makers that do dominate the market. Just because they are large in number it still does not make it suitable market for Apple. Unless they decide to sell cheap stuff, much much more cheaper then they already tempted to sell.

 

[pika2000]

Taking pre-orders and being successful are 2 different things. In India is mostly cheap Chinese phone makers that do dominate the market. Just because they are large in number it still does not make it suitable market for Apple. Unless they decide to sell cheap stuff, much much more cheaper then they already tempted to sell.

Here are the top brands in India
1. Samsung
2. Nestlé
3. LG
4. Amul
5. Sony
6. Apple
7. Google
8. Big Bazaar
9. Philips
10. Amazon

How many of them are Chinese?
Just because India's economy is not on par with the western world, doesn't mean companies should only sell cheap stuff over there. Now, the Chinese OEMs are doing great, but Apple is not competing with them. Just like LV not competing with some cheap handbag at a flea market. It's about desirability. When a middle class Indian gets richer and richer, do you think they still want to buy some cheap Xiaomi? Status is important in many Asian cultures, and a smartphone is becoming the status symbol for many (when cars and houses are too far out of reach). This is why Apple (and many other brands, even Sony), wants to keep playing in the emerging markets.

 

[aakshey]

Here are the top brands in India
1. Samsung
2. Nestlé
3. LG
4. Amul
5. Sony
6. Apple
7. Google
8. Big Bazaar
9. Philips
10. Amazon

How many of them are Chinese?
Just because India's economy is not on par with the western world, doesn't mean companies should only sell cheap stuff over there. Now, the Chinese OEMs are doing great, but Apple is not competing with them. Just like LV not competing with some cheap handbag at a flea market. It's about desirability. When a middle class Indian gets richer and richer, do you think they still want to buy some cheap Xiaomi? Status is important in many Asian cultures, and a smartphone is becoming the status symbol for many (when cars and houses are too far out of reach). This is why Apple (and many other brands, even Sony), wants to keep playing in the emerging markets.

Agreed.

 

[pika2000]

3. Yes, if Apple does local production in India, they can reduce their prices significantly. And I want them to do that too. I’m not sure what’s stopping them though.

Imo it's because they were too focused on China, and simply didn't spend too much effort in other Asian countries until the last few years.

 

[mtneer]

Part of Apple's cachet is that its high end/ luxury/ hard-to-get. Apple will have to dilute its brand cachet if its chose to sell to people in India who cannot afford its products. People in China consider Apple products a status symbol - will they continue to do so if Indians started walking around with Apple products as well?

 

[Radon87000]

India just isn't ready for the brand of company that Apple is. Apple isn't going to offer special Indian versions of their products that sell at a cheaper price. Until the standard of living improves drastically for those billion people, Apple products are simply aspirational.

And the privacy/security issues with the government will make it a worse market than China to operate in. Apple at least makes money in China to justify the government issues.

The reason Apple has such less marketshare is because competing products like the Galaxy Note are sold at a drastically lower price because of local manufacturing. The difference is almost half price. Until Apple does local manufacturing there is no chance they will succeed in India.

 

[DeepIn2U]

Whats new in this? Apple already has this kind of setup in India for sometime now..increasing square feet of retail doesn't help..

1/ Better service ? No
2/ Apple Pay ? No
3/ Reduces supply chain issues ? No
4/ Does it really help in reducing the cost of apple products ? NO!
5/ Improvement in maps? hell no!

BRAVO!

Apple & India's Government & Cellular Providers ... NEED to come up with some sort of loyalty or point system.
Apple:
- increase warranty to 2yrs (forgo AppleCare+) the mass market and even the upperclass are VERY prudent with spending their hard earned money! They'll spend MORE on a wedding vs a smartphone.
- Work better with the Government there:
> implement iTunes U native education with universities and make iPad Mini donations for those that cannot make it to school or afford that and food and a good home.
> implement the iTunes U with hardware donations (give them all the current Mac Mini's, older iMac's in stock, iPad Air 2's and iPad Mini 4's still in various stocks across the globe). DONATIONS = Goodwill and faith in your brand.
> Increase production of iPhone SE, 5C, 6/6S in that location and price them more aggressively, competitively.
> work with carriers for a subsidy program that is exclusive. Give some sort of extra reduction for students registered and attenting K12 and University. DO this BEFORE GOOGLE get's a strong foothold there - they probably already do!
> Work with government and universities to fully digitize their educational system, minimize costs exponentially and make it mobile. Allow graduated students to host their video feeds for up and coming students!!
> EMBRACE Indian marketing. Feature MORE of their people in various markets, feature the BEAUTY of India in your local commercials. They're NOT American's nor will they want to BE that way so stop trying to sell them the Uncle Tom look of Fame/Glamour/Elitiscm! (Sorry had to go there).

> Executives. Spend more than a day there ... go for a week or two there SHOW them they're ARE as important as your CLAIM! Do NOT ask for roaming forgiveness and other needless favours. Ride a bicycle and scooter about while there the majority of time.

LIVE a WEEK in a common person shoes and they'll open their arms to you!

@aakshey,

Point 3/ Reduces supply chain issues ? No above is that Apple has to increase production locally to employ citizens of India in order to open up any official retail stores there. This half stepping is going to SHOOT Apple in the knees in 10yrs there when this nation becomes rich. Modi is cleaning up (rural homes that have no toilets are getting HUGE grants in order to clean up their streets and village - featured on Bloomberg less than 3wks ago). Soon enough you'll see huge changes within all large and small towns to a more modern age.

Here are the top brands in India
1. Samsung
2. Nestlé
3. LG
4. Amul
5. Sony
6. Apple
7. Google
8. Big Bazaar
9. Philips
10. Amazon

How many of them are Chinese?
Just because India's economy is not on par with the western world, doesn't mean companies should only sell cheap stuff over there. Now, the Chinese OEMs are doing great, but Apple is not competing with them. Just like LV not competing with some cheap handbag at a flea market. It's about desirability. When a middle class Indian gets richer and richer, do you think they still want to buy some cheap Xiaomi? Status is important in many Asian cultures, and a smartphone is becoming the status symbol for many (when cars and houses are too far out of reach). This is why Apple (and many other brands, even Sony), wants to keep playing in the emerging markets.

Last I checked;
Apple competes with Samsung, LG and Google on many fronts. They have former executives working at Nest (not Nestle lol so I guess that was a typo).

If ANY competition is making sales and revenue above 5% and more loyal customers in an entire country of over 1 billion people ... and you're at 1% ... Apple is ALWAYS in competition with them. Always - not just today in terms of pricing yet also in the mindset/mindshare for brand name recognition and such. And right now ... to most within India that can buy a smartphone, computer, smartwatch ... Apple is the GREED of America personified!

 

[aakshey]

The reason Apple has such less marketshare is because competing products like the Galaxy Note are sold at a drastically lower price because of local manufacturing. The difference is almost half price. Until Apple does local manufacturing there is no chance they will succeed in India.

I agree.

But if they can sell the X for USD 1000 all inclusive for the 64 GB version, they can probably sell 5-10x the units they are selling right now.

But for that they need to manufacture in India and still reduce their margins.

 

[JPack]

Part of Apple's cachet is that its high end/ luxury/ hard-to-get. Apple will have to dilute its brand cachet if its chose to sell to people in India who cannot afford its products. People in China consider Apple products a status symbol - will they continue to do so if Indians started walking around with Apple products as well?

Apple sells older and affordable products like iPhone SE and 6s. Apple is no longer hard to get.

The problem is Indian consumers having so little spending power compared to the global average. Apple can stoop down and sell $150 phones but clearly, they don't feel the need to capture such a small profit share.

Many of the above posters are trying to fix a problem without getting to the root cause. Apple Maps, AppleCare, and taxes are not the problem. In 2007, Apple sold more than a million iPhones in China through the grey market before there was a single Apple Store in the country. Indians simply can't afford premium products yet. In the meanwhile, it's a waiting game for the country to develop.

 

[aakshey]

Apple sells older and affordable products like iPhone SE and 6s. Apple is no longer hard to get.

The problem is Indian consumers having so little spending power compared to the global average. Apple can stoop down and sell $150 phones but clearly, they don't feel the need to capture such a small profit share.

Many of the above posters are trying to fix a problem without getting to the root cause. Apple Maps, AppleCare, and taxes are not the problem. In 2007, Apple sold more than a million iPhones in China through the grey market before there was a single Apple Store in the country. Indians simply can't afford premium products yet. In the meanwhile, it's a waiting game for the country to develop.

SE sells for USD 250-300 in India based on the timeframe.

6 for USD 300-350.

But Indians rather buy a X or OnePlus or cheaper Samsung instead.

 

[now i see it]

Problem: iPhones are too expensive.
Solution: Build bigger stores.

 

[Radon87000]

I agree.

But if they can sell the X for USD 1000 all inclusive for the 64 GB version, they can probably sell 5-10x the units they are selling right now.

But for that they need to manufacture in India and still reduce their margins.

Also Samsung Pay works in India while Apple Pay is nowhere to be seen. Anyone who can afford these phones would miss a feature like this. Google and Samsung have a better knowledge of that market than Apple.

 

[Radon87000]

Apple sells older and affordable products like iPhone SE and 6s. Apple is no longer hard to get.

The problem is Indian consumers having so little spending power compared to the global average. Apple can stoop down and sell $150 phones but clearly, they don't feel the need to capture such a small profit share.

Many of the above posters are trying to fix a problem without getting to the root cause. Apple Maps, AppleCare, and taxes are not the problem. In 2007, Apple sold more than a million iPhones in China through the grey market before there was a single Apple Store in the country. Indians simply can't afford premium products yet. In the meanwhile, it's a waiting game for the country to develop.

Indian market is dominated by large screen phones. The SE will never sell in that market and the 6s is too old to even be a contender. You can get a Galaxy S8 for the same price as a 6s in India. It’s a joke.

 

[code-m]

Whats new in this? Apple already has this kind of setup in India for sometime now..increasing square feet of retail doesn't help..

1/ Better service ? No
2/ Apple Pay ? No
3/ Reduces supply chain issues ? No
4/ Does it really help in reducing the cost of apple products ? NO!
5/ Improvement in maps? hell no!

Too Little Too Late -song from singer JoJo.

Apple is not sure what their want out of the Indian market, their know their want a presence and that can be said for certainty. No commitment of an official Apple Store let along services that actually work and are beneficial to the local market.
[doublepost=1534871942][/doublepost]

Indian market is dominated by large screen phones. The SE will never sell in that market and the 6s is too old to even be a contender. You can get a Galaxy S8 for the same price as a 6s in India. It’s a joke.

Apple is too smug to take a cut to its profit margins. Their assumption is that the Indian customer is similar to the Chinese customer and the same playbook is used from the American customer. Unfortunately their are sadly mistaken.

 

[delhifox]

1. Not many Indians pay a premium for better service. They only care about objective metrics and features.

2. I don't think any Indian outside of MR has heard of it.

3. Please elaborate.

4. That's the opposite for what they are trying to do. They've already mentioned they want to sell at MRP only.

5. Everybody outside of MR is happy with Google Maps in India. They would never buy an iPhone for Apple Maps, no matter how good it becomes.

1/ India doesn't get the same level of service compared to North America stores. If you going to charge North American $, why not give North American service ?
2/ Not sure what's "MR", but its a great feature in markets which has ApplePay. Indian or not Indian. Again.. when you have samsung pay why not Apple Pay?
3/They can't get optimize cost if they don't break the Muti level distribution issues in india. It just takes too may "middle men" before it reaches customer. Hence no scope of cost optimization. They should own this - specially if you have 1000 year plan for india (Tim Cook said this).
4/ Same as #3
5/ Maps are just not navigation, it has deep intergration with many products/software. Without the fixing this, the experience is limited.

 

[code-m]

Problem: iPhones are too expensive.
Solution: Build bigger stores.

To store more inventory of a product no one is interested in purchasing. Logic dear Apple. /s