India’s Tier 2 and 3 cities led growth in smartphone sales during the festive season between August and October, according to IDC.
Total sales in tier 2 and 3 cities – those with a population of between 20,000 and 100,000 - grew 23.3% growth over the previous month, the research firm's latest Monthly City Level Smartphone tracker shows.
IDC said this is largely due to vendors focusing on new affordable launches, higher spending on marketing and innovative payment options.
IDC India senior market analyst Upasana Joshi said the key four months from July to October 2016 made up more than 40% of annual smartphone sales. The festive season in India started in August with Independence Day and ran until Diwali in October, drove the consumer buying across all markets.
“Multiple sales by all major e-commerce players in October with their high-decibel marketing, attractive payment options, and exchange offers also helped in growing the market. The top 8 to 10 cities of India constitute the major portion of online sales, leaving a yawning gap between these markets and the still largely untapped smaller towns,” he said.
Josh disclosed that China-based players contributed significantly to the growth at the offline retail counters while continuing to dominate the online channel.
“These vendors collectively accounted for more than 40% market share in the top 30 cities during Diwali month, primarily driven by 4G enabled handsets. Oppo and Vivo continue to shake the traditional line up of Indian vendors with their superior build quality, massive marketing investments in the offline channel,” he said.
Varun Singh, Market Analyst, IDC India, added that e-commerce players have also started investing more on sellers in smaller cities, better model and improving delivery network, moving away from deeper discounts.
“Previously offline only or online only vendors have now started drawing benefits from their multi-channel strategies, acknowledging that offline and online channels can coexist in the market, without necessarily posing a threat to each other,” he said.
Samsung registered 26.1% share in the top 30 cities. With a series of newly launched models namely J5 Prime and J7 Prime, Samsung clocked 15.8% shipments growth in October over the previous month.