Samsung’s top position in Indian phone market under pressure

Samsung is still the leader in the burgeoning Indian mobile market, but the Korean handset giant is losing ground in one of the world's largest markets as it faces stiff competition from rivals like Micromax, Karbonn, Lava and Microsoft (formerly Nokia), and now Intex.

According to the latest data from CyberMedia Research (CMR), Samsung is "losing its earlier firm grip" with its share declining to 16.5 per cent at the end of December 2014 from 20.3 per cent at the beginning of the year.

According to the research firm's India Monthly Mobile Handsets Market Review, for calendar year 2014, India mobile handsets market grew by 4 per cent to 257 million units in terms of shipments over 2013. Of this, Samsung captured 16.5 per cent of the shipments, followed by Micromax and Microsoft at 13.3 per cent each, it added.

"However, Samsung was seen to be losing its earlier firm grip on market, as its share of the market showed a downward trend during the year, as compared to Micromax that gained primarily in April-June 2014, but then continued to remain flat during the rest of the year," CMR said in a statement.

Samsung's share of the overall market in January-March 2014 quarter stood at 20.3 per cent, while that of Micromax was 11.2 per cent and Microsoft 17.6 per cent.

About 77 million smart phones were shipped in 2014, accounting for nearly 30 per cent of the total mobile phone market in the country. The smart phones segment grew 46 per cent as against the previous year.

Samsung lost ground in the smart phone segment too, with its market share falling from 43.2 per cent at the beginning of the year to 29.3 per cent at the end of December 2014.

Micromax, on the other hand, expanded its share marginally from 17.5 per cent in January-March 2014 to 18.9 per cent in the fourth quarter of 2014.

"2014 proved to be a path-breaking year for the India mobile phones market, essentially in terms of high proportion of smart phones shipped. A lot of consumer enthusiasm was seen in terms of launch of new phone models and brands, unique features and a significant change in sales strategies of vendors," CMR lead analyst (telecoms research) Faisal Kawoosa said.

"This resulted not only in making available a wider set of options for buyers, but also challenged industry players to remain competitive as well as creative in their offerings," he added.

Conflicting data
Last week, multiple research reports showed contrasting data on market leader in the Indian smart phone market.

While Canalys said Micromax had 22 per cent share and had overtaken Samsung (20 per cent) as number one, research firm Counterpoint stated that the Korean giant continued to be at the top with 27.4 per cent smart phone market share in the October-December 2014 quarter.

Samsung led the overall mobile phone market too with 16.1 per cent share, followed by Micromax (14.4 per cent overall and 19.5 per cent in smart phone market), according to Counterpoint.

Another report by GfK, which is based on sales numbers, put Samsung ahead of the domestic rival with 34.3 per cent share of the Indian smart phone market at the end of December 2014.

CMR said the growth in smart phone shipment was propelled by a number of reasons, the main being availability of a wide range of models and brands under Rs15,000, pickup in online sales, increasing mobile data consumption and decline in data tariffs and operators extending their data network footprints.

While many new brands emerged in the India market, the focus continued to be on offering the best experience at the right price-point, CMR said.

"Going forward, the challenge would be to provide customers equally high levels of after-sales experience across the length and breadth of the country. This will call for a deep focus and investment on improving distribution and servicing networks," CMR Telecoms Analyst Karn Chauhan said.

Some of the new smart phone brands rely exclusively on online sales and it would be interesting to watch how they go about increasing their market footprint, to penetrate deeper into upcountry locations, he added. "Such expansion would help them reach a large base of potential buyers without easy access to online platforms," he said.