Financing schemes, latest features driving smartphone purchases in India: IDC

Highlights:

• Word of mouth is the most prominent influencing source to buy a smartphone
• Offline outlets still hold relevance in Indian market
• OnePlus is the most preferred premium Android smartphone brand

One out of three, that is about 33 percent of consumers, prioritise good deals and availability of latest hardware specification or feature while they are buying a new smartphone, the latest Consumer PULSE research study by market research firm International Data Corporation (IDC) has noted. The behaviour can be attributed to multiple sales events as well as high decibel marketing by eTailers offering attractive financing schemes making smartphones affordable.

“In terms of specifications, consumers have many choices especially from China based vendors at affordable prices. Currently, RAM and processing speed are the most preferred specifications followed by bigger battery size and superior camera quality. Additionally, features like face unlock and waterproofing are yet to gain importance amongst consumers,” Sachin Mehta, Market Analyst at IDC India, said in a statement.

The firm says that word of mouth is still the most prominent source influencing consumer buying behavior for smartphones. The trend has been working for brands like Xiaomi and OnePlus, which rely on their dedicated fan-based community to spread the word of mouth in the Indian market. Brand trust is the highest influencing factor for two-third of Xiaomi consumers, followed by value for money proposition and availability of latest specifications.

When it comes to the channel preference, online shopping is gradually becoming popular with consumers. “Convenience being one of the most important and basic reasons almost 40% of consumers prefer online channel for the overall comfort and convenience, followed by prices offered by eTailers. In terms of mode of payment while buying a smartphone, EMI options as a choice for payment has increased, followed closely by use of Debit/Credit cards owing to multiple tie ups by eTailers with Banks for cash back offers,” added Upasana Joshi, Associate Research Manager, Channel Research at IDC India.

In the case of offline channels, the firm claims that two out three consumers visit offline retailer stores to have a hand on experience of the device before making the final purchase. More than half of offline consumers feel that the next vital factor is the near to home convenience. This behaviour is driving the retailer/promoter push at the shop counter in deciding the brand and model choice for the consumer.

As for the payments, consumers still prefer to purchase smartphone through cash on retail counters, however a steady uptake is witnessed in payment options through EMIs (Equated Monthly Installment) and Debit/Credit cards. Interestingly, more than half of offline consumers visit a multi brand outlet, of which two third finally buy smartphones from these outlets signifying the continued relevance of the offline channel in India market.

Some price and brand specific highlights:

• With the availability of financing, nearly half of the consumers who had spent Rs 10,000-20,000 on their previous smartphones upgraded to Rs 30,000+ segment.
• Chinese vendors such as Xiaomi, Vivo and Oppo are perceived as great value for money brands for their quality, design and delivering on what they promise.
• Overall consumers who visit online stores consider Flipkart as their first choice. However, premium smartphone (over Rs 30,000) consumers prefer Amazon for buying a smartphone.
• In offline, apart from multi-brand outlets (MBOs), Reliance Digital stores are emerging as a strong choice for buying premium end devices due to availability of better discounts, offers and store presence in the country.
• Apart from good deals/offers, experiencing a new technology/feature is another key reason while making purchase decision in the premium segment.
• Online reviews are one of the key influencers for people before they make the final purchase in the premium segment category.
• OnePlus is the most preferred premium android smartphone brand, especially for consumers who are looking for an Android smartphone.
• The firm says that 90 percent of people who bought a OnePlus smartphone had OnePlus as their first choice before they finally bought the device. This is because the brand offers latest specifications and the shoppers trust it, IDC added.
• Those people who use an iPhone remained highly loyal to the brand.

IDC India Smartphone PULSE is an extensive smartphone end consumer facing research programme covering eight major cities in India with a sample size of 1700 consumer.

 

Related Read:

OnePlus beats Apple, Samsung to lead premium smartphone shipments in India in Q3 2018: IDC

Android OS to clock nearly 85% market share in 2018, claims IDC

Xiaomi most preferred smartphone brand in Rs 10K-15K price tier, OnePlus tops Rs 25,000 – Rs 40,000 segment: Counterpoint