Mobile phone manufacturers around the world are already on a “look East” policy. As smartphone sales in developed countries such as the United States, Canada and parts of Europe are already at high levels, the potential market lies with countries where the penetration is still low, and when it comes to size there are only two countries that will be on top of any manufacturer’s list: China and India.
India is a huge, untapped opportunity for smartphone manufacturers because smartphone penetration as a percentage of overall mobile phone sales is only 50%, compared to 96% in China. With a population well in excess of one billion, that’s a huge number of users who are yet to start connecting to the internet world through a smartphone. Simply put, the numbers of hands that we can put smartphones into in India is still quite high.
“Our iPhone sales in India were up over 50% in financial year 2016 compared to the prior year, and we believe we’re just beginning to scratch the surface of this large and growing market opportunity,” said Tim Cook, CEO of Apple Inc.
India has the fastest-growing smartphone market in the world, accounting for 27.5 million devices sold in the second quarter of 2016, up 17 percent from the previous quarter, according to IDC. Mobile subscriptions are expected to hit 1.4 billion by 2021, according to the Ericsson Mobility Report, released in June 2016.
As the world’s fastest growing economy, the Indian smartphone market is at the right stage for accelerated growth. The market is still dominated by low-priced smartphones but, as the economy grows, it will allow customers to keep moving up the price ladder and spend more on smartphones.
Gartner expects smartphone sales to rapidly increase in India, and account for 62% of all mobile phone sales in the country in 2017, compared to 50% in 2016.
“With the slowdown in sales in major markets, including the U.S., China and mature Western Europe, India represents the largest opportunity because it is the second-largest mobile phone market after China,” said Anshul Gupta, research director at Gartner.