Being a sports fan if I switch on to any sports event whether it’s the IPL or the cricket series or the kabaddi or badminton leagues you find mobilephone manufacturers like Samsung , Oppo , Vivo or LG as one of the key sponsors and their advertisements keep screaming at you during every break..If I decide to walk to office in Mumbai which is a 15 minute walk I find a different mobile store every 100 metres with again branding of all the major mobile handset manufacturers shouting out at me
The last time I got a smartphone I did all my research online taking help of the innumerable websites and e commerce websites which help you compare different models , shortlisted a couple based on the price segment and finally purchased the same from one of the top modern trade retail chains after verifying the prices online too
In this situation can we imagine a manufacturer becoming the joint No1 mobile handset manufacturer without even being present in this brick and mortar channel…Very unlikely right ?
The smartphone market in India
- · In 2017 about 135 million smartphones would have been sold in India making it the second biggest market of smartphones behind China
- · The average upgrade time for a smartphone in india is now down to close to 20 months
- · Two of the three indian smartphone users plan to change their smart phone next year. Almost 40% of present smartphones being used are only 2G or 3G compatible making the urge to change even higher
- · The downward spiral of mobile data cost with the launch of Jio has increased data usage exponentially
- · Selfie Cameras, Memory capacity and finger print sensor are the key considerations among smart phone users
- · In 2016 there were 269 million urban net users and 163 million rural net users in India
Redmi presence and growth in India
- · First flash sale of MI 3 on flipkart was planned on 22nd July 2014.The sale was supposed to start at 2 pm and half a million people logged in crashing flip kart website .This when there were no promotions and advertisements which were released for the product.The only communication means was by its facebook page in India which had already garnered 10000 followers
- · In the second flash sale in July 2014 the 10000 handsets which were on offer on flipkart website got sold in 2 minutes
- · Since then its market share has progressed from 3% in 2015 to 9% in last quarter of 2016 to 23.5% market share in Q3 of 2017 making it joint first place with none other than global market leader Samsung
So what did Redmi do differently?
- · Offered higher specifications at an affordable price.
Consider Redmi Note 4 .Powered by Qualcomm Snapdragon 625 processor with 4 GB RAM and 64GB of ROM ,4100 mah battery which lasts for almost 2 days,5 MP Front camera and 13 MP back camera priced around Rs12000 .A comparable smart phone with similar features comes in the range of Rs18000 to Rs22000.This positioned the brand as value for money instead of cheap which is the mistake most of the indian manufactures have made
· Focussed on the Rs 10000 to Rs15000 segment which is the fastest growing segment in the smart phone market. Redmi had 3 models occupying the top three slots in this segment.
- · Formed MI(Xiaomi) community
Has 2.9 million registered users in the community .Listening to customer feedback incorporated the feedback received through the community in their products. Like in all users wanted multiSIM models to offer access to two Whatsapp accounts which was introduced by Redmi based on customer requirement becoming the first company to do so
- · Direct connect for indian customers to the Indian Head through Community and other social media platforms enabling better feedback and bonding
- · The only handset maker to have 26 fab clubs across colleges are cities in India.
I realised the power of this a year back when my nephew who is just 17 already knew about the features available and several of his friends already owned the brand
Does this mean the end of brick and mortar retail stores ?
There are signs that the brick and mortar stores are fast becoming reduntant
But for products like mobile handsets where technical specifications are clearly specified and measurable and comparable based on data provided by each manufacturer ,today 7 out of every 10 indians prefer the online purchase option
The last 2 years has already seen online buyers rise seven fold to become close to 90 million and with online purchase spending is rise ten fold to about $ 550 billion in the next 7 years , the success of Redmi clearly shows the influence that the online channel has come to play in the purchase decisions
