CHART: A Look at India's Smartphone Market in Q3 2024

• vivo claims top spot in India’s smartphone market for the first time.
• Consumers favoured mid-to-high-end models, while entry-level demand was weak due to rising prices.
• Apple sees demand surge for iPhone 15, alongside emerging brands like Motorola and Google.

In an unexpected twist, vivo has claimed the top spot in India's smartphone market for the first time, securing a 19% market share and shipping 9.1 million units in Q3 2024 according to a Canalys report.

This impressive rise was fueled by vivo’s aggressive strategy across both online and offline channels, along with new product launches in higher price brackets. Strong partnerships and attractive margins for retailers also helped propel the brand ahead of its competitors in a market where budget devices usually dominate.

But it wasn’t all smooth sailing in the broader Indian smartphone market according to the report. Although the market showed positive growth of 9%, totalling 47.1 million units, the early festive season didn’t bring the kind of consumer rush that brands had anticipated. Rising food inflation and cautious urban spending contributed to the sluggish sales, despite early monsoon sales clearing out inventories.

The report also noted a shift in consumer behaviour in the quarter. Replacement and upgrade buyers focused more on mid-to-high-end models, driven by attractive trade-in deals and easy financing options that made premium devices more accessible. However, demand for entry-level devices—traditionally a large part of India’s market—was weak, as rising prices caused many consumers to delay their purchases until after Diwali.

This leaves vendors in a tricky spot moving into the festive quarter. Vendors have built-up inventory, having stocked up devices in anticipation of strong festive demand, which didn't go as planned. Now these brands with excess stock will need to use offline channels, offering heavy discounts and extending margins to retailers to move inventory.