If you can source it from China, have large marketing budgets and retail distribution in place, you can sell it in India.
Seeing the success of MicroMax, Karbonn, Lava and Lemon – low cost “value for money” entrants in India’s burgeoning handset market – more consumer companies are now adding mobile handsets to their portfolio. A Voice & Data survey revealed earlier this month that local Indian handset brands (including Spice) grabbed 14% marketshare (up from 3-4% a year ago), and Nokia lost 12% market share. Of the Indian brands, Micromax has 4.1% handset market share by revenue, Spice has 3.9%, Karbonn has 3%, Lava has 1.1%, Lemon 1% and Max has 0.9%. Around 108 million mobile phones were sold in the country during 2009-10, adding up to Rs 27,000 crore in sales, according to Voice & Data.
Oscar Launches Low Cost Handsets
Another one to the list, apart from Intex, with also launched a QWERTY handset a few days ago: Consumer Electronics has launched dual SIM no-frills handsets at a price point of under Rs. 5000 ($107). They’ll 10 launch handsets priced between Rs. 1700 ($37) and Rs. 4500 ($96) in the next few months. The company has distribution in the North and East of India, and sells color TVs, DVDs, Home Theatre Systems, and, according to Chairman Satish Verma, intends to “introduce the most affordable handsets in India keeping in mind the features to price ratio.”
Oscar has targeted sales of 100,000 handsets per month with a turnover of Rs. 250 crores, and growth of 15-20%, and hopes of a turnover of Rs. 1000 crores in five years. They currently have network of 250 service centers, and a distribution network of 1500 retail outlets, and are planning to hit 8000 retail points by the end of the year.
Are there any differentiators beyond price? Oscar suggests that they have enhanced network connectivity, high audio output for crowded bazaars, and superior video quality (we’ll believe it when we see it), but what is rather outrageous (and compelling) as a feature is battery life of “30 days of standby because of the special 1800 – 2000 mAh battery used”. Apart from the entry level N1, most phones have/will have an FM Radio, MP3, MP4 player, browsing capabilities, and a 1.3 MP camera.
But What About Nokia?
Here’s the thing: Nokia still retains 52% marketshare in India, but there’s trouble at the bottom with more of these local brands launching handsets (an announcement today from Oscar below, and Intex a few days ago; Lemon has big plans), and there’s trouble at the top with the Android juggernaut replacing Symbian. It won’t be long before Android handsets are available for Rs. 6000-8000, and then Nokia will be in serious trouble. In the past, Nokia’s distribution and exceptional service quality have saved its skin; people still trust the brand, but Nokia has failed to deliver with its handsets. According to voice and data, Nokia has 200,000 retail outlets and 700 support centers across 400 towns/cities in India.
Instead of focusing on handsets and service, Nokia has tried to focus on a market with higher margins – the top end, and It is, perhaps, too late; don’t take my word for it – read this long ‘goodbye’ post from a former Nokia fanboy who is switching to Android – SymbianGuru. I’m finding it difficult to let go of my N95, but I’ve seen enough of the Android, despite its niggles, to make a switch. Ovi, for me, just isn’t good enough in comparison, and not a compelling reason to stay with Nokia.
(Update: had incorrectly mentioned Micromax as Macromax. Corrected)