Why Apple failed in India.

It’s not the best-selling gadget ever made: it’s one of the most influential. Since Steve Jobs announced the iPhone in 2007, Apple has sold more than 1.5 billion of them, creating giant businesses for app developers and sub-makers, and redefining the way we live. Millions of people use the iPhone as their only computer. Their only camera, GPS device, music player, communicator, trip planner, payment instrument. It put the world in our pockets.

Before the iPhone, smartphones were mostly copying BlackBerry. After the iPhone, they all copied Apple: most phones now have bigger screens, beautiful designs, and ever-improving cameras. There are even “tips” or cut-outs above the edge-to-edge display of the camera’s front-facing camera.

At that time specifically phones like NOKIA, Motorola, Samsung are in demand. Blackberry is the flagship at that time. But they all come with basic features like keypad mobiles with a poor camera. No touchscreen and small screen device.

Apple vs Other smartphones
Apple vs Other smartphones

iphone india market share

Apple Inc. (AAPL) became the first company in the world to record a $ 1 trillion market capitalization, followed by a $ 1.3 trillion mark in December 2019.

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Global GDP was $ 85.9 trillion in 2018, according to the latest data from the World Bank, and Apple’s market share is 1.5% of the whole Global GDP of that figure. Compared to the U.S., the largest economy with a GDP of $ 20.5 billion in 2018, the Apple market represents 6.3%. Only 14 countries have annual GDP figures greater than Apple’s cap.

How Apple sales increases in India.
Apple sales Graph 1.1

All big companies like Google, Amazon, Uber are successful in India except Apple. If we see data, we might be surprised to see iPhone India market share. But its true, Apple is unable to step their foot in India as other companies did. Apple iPhone India market share accounted for only 1% of the total smartphone market.

iPhone india market share
iPhone india market share

If Apple is so big in other countries, so why India matters to Apple.

If we analyse the growth pattern of Apple in Graph 1.1, then we see that Apple grows exponentially from 2007 to 2015. After 2015 Apple stops growing in the same manner and suddenly a growth of -0.3% in recorded in the year 2018. What is be reason behind it.

Any company success depends upon 3 factors of sales that are:-
1) New Smartphones Buyer (Emerging market)
2) Switch Customer
3) Existing Customer

Apple is an expensive phone so people from the developed nation can buy it easily because of their high average per GDP Capita. In the developed nation almost all people that can buy a smartphone has already bought it. So there is no space left for any new demand from a developed nation as almost all new smartphone user are there in a developed nation.
That does not mean Apple is declining, Apple is not growing as before like 50% growth in a year, 40% growth in a year. The fact is Apple is selling over 200million+ phones per year, which is pretty good.

Apple in the past 3 years unable to increase their sales by their existing customer because Apple being in premium segment build really advance and high-quality phones than before. An average iPhone can easily be used for more than 2 years. Which holds the user to upgrade their phone for the next 3 to 4 years. Which was not the case before. Before people upgrade their phones within 2 years of span. So Apple product is so good for their own good. This is also the reason for the increase in the prices for the new iPhone’s, which eventually increases the profit for Apple by selling same units of phones.

You can check the specification of all the iPhones from here.

Because of this reason Apple is in search of new markets across Globe to increase their sales. That is why India is a very important market for Apple as it is the fastest-growing economy in the world and people are also fond of Apple phones and laptops.

Why Apple is interested in India and fails in India.

Apple is in the search for new customers to increase their sales, this we have discussed in above paragraph. So Apple is looking towards India as in India over 63,360 people in India has been pulled out of poverty every day. In term of raw GDP India ranks for 6th position in the world.

Today India is the seventh-largest economy and the third largest in terms of purchasing power parity (PPP). Gross domestic product of the Indian economy is 2.9 TRILLION DOLLARS. At a press conference, Finance Minister Arun Jaitley said, “We are swinging between the fifth and sixth largest economies depending on the dollar rate. Looking ahead to the year, we will have 5 trillion dollars by 2024 and 10 trillion by 2030 or 2031.

In spite of these amazing figure, the sad reality is the GDP per capita income of India, which decide any countries economic condition.
GDP per capita for India is near to $2000 per annum which ranks 139th position in the world rank, and a starting iPhone in India cost around $1049.

A cheapest brand new category of iPhone that is iPhone XR priced in the U.S around $749 but as it comes to India their prices increases to $1096 due to currency exchange rates, tariffs, exports and imports and various taxes. Apple India support for their prices has been increasing by the help of the government.

In India, around 75% of people buying a smartphone range under $250 and 95% people buy under $500 that means they are not capable of buying an iPhone. So for most of the people in India iPhone is much much expensive product to buy. Also, many Indians does not buy smartphone but use a feature phone. Due to which Apple share in the India market is almost near to 2% of all phone segment.

Problems with iPhone in India.

Smartphone in India based on Android are much efficient in terms of daily usage as compared to Apple’s phone. Some very noticeable problems with an iPhone is their own software problems in India. Like Apple pay does not work in India at all.

Apple maps are not efficient and correct to use, people find it difficult to use apple maps in India. Siri is unable to understand the local accent of people in India. Many software is not available in India app store. So Apple India support system is improving but not get fully improved yet.

Apple Store in India

Apple makes the most money out of their offline retail stores in other countries as they make very big, beautiful, a full-glassy store that makes it very attractive to people. That’s Tim Cook(CEO of Apple) planning to build its first Apple store in India.

Apple stores

But Apple store in India is counted zero because the government of India does not permit Apple to make it. The reason behind this is:- to make any retail store in India one has to buy at least 30% of material from India, then also they can build their retail store. But till now apple is not manufacturing any of the product. Tim Cook CEO of Apple decided to start manufacturing iPhone SE and iPhone 6s in Chennai. Apple store in India is most probably build in Bengaluru. This can increase the iPhone India market share.

Competitor in India like Oppo, Vivo, Xiomi, Samsung are offering great smartphones at relatively much low prices than Apple.

In India, premium markets start from price over 30000 rup and one plus is offering specification almost equal to Apple’s specification. Yes, it lacks in User experience and other factors, but Indians are more fond of specifications than user experience. Check the latest one plus phones below.

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2 Responses

  1. Yuvraj says:

    Nice blog dude.. Interesting information in easy words.

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