Kobian became the ninth mobile handset seller in India and sixth handset seller in 2010.That doesn’t seem to perturb Nokia, market leader for mobile handsets in India. Nokia commands a comfortable 59 percent market share in India’s $5.6 billion mobile handset market.
India ranks very high in Nokia’s scheme of things. India is Nokia’s second-largest market in 2009 with net sales of US$3.7 billion, China ($8 billion) and ahead of the UK (US$2.5 billion). Nokia is almost synonymous with mobile phones in India. It is so ubiquitous that “Roti Kapda aur Nokia” is a slogan in rural areas. To cope with the increasing Indian demand Nokia has opened a manufacturing facility in India (one of its nine). 350 million Nokia mobile phones were produced from Jan 2006 to April 2010 in its Sriperumbudur manufacturing facility. Half of these phones are exported. India has close to 600 million mobile connections and probably more than 600 million mobile phones.
Nokia knows the Indian market very well. It has concentrated its phones on two simple parameters. Robustness and long battery life. Robustness to deal with rough usage and longer battery life to deal with erratic power supply. The phones are dropped 100 times from a one meter height, tested for heat and humidity and the keys are pressed 10,000 times. Nokia’s strategy has paid off very well so far. With the disposable rural incomes raising, Nokia targeted rural markets and quite rightly so. Twenty-five percent of its sales are in rural areas. Whether it is a tie-up with microfinance companies for financing the phone purchase or an ultra low-cost mobile phone or a bicycle charger, Nokia has devised new ways to penetrate rural markets. It has not paid much attention to the form factor or any other nuances needed to capture new markets and saturated urban markets. That had hit Nokia.
February and March 2010 were difficult months for Nokia. It saw its market share drop by four percent. Much of it is attributed to the rise of several upstarts. Micromax, an Indian company was eating Nokia’s lunch with an enviable market share rise. Micromax has a market share of six percent and it sells one million mobile phones per month. The company is less than three years old.
How did Nokia let Micromax do it?
It neglected an important and rising market segment. Twenty-two of the 26 phones released by Micromax are dual-SIM phones. Nokia hasn’t launched enough dualSIM phones to counter Micromax. With so many service providers coming up with so many luring offers it is hard to resist not having two numbers. The urban tele-density crossed 100 percent a long time ago. Nokia did not concentrate enough on the urban market and moved on to rural. A big mistake.
Nokia has a near 60 percent market share in India. It is followed by Samsung (11 percent), Sony Ericsson (nine percent). The rest is split between Motorola, LG and a bunch of upstarts – Micromax, Spice, Intex, Zen, Onida, Karbonn, Videocon and INQ. All the upstarts have launched their campaigns during IPL which explains a surge in the month of March for others.
Now Nokia has gained back the market share. If it wants to dominate the Indian market then it has to constantly innovate. Every new handset seller is coming up with something new. If it’s dual-SIM and gaming device for Micromax, then it is social media for INQ. Zen mobile concentrates on the form factor and some really trendy mobiles. Nokia is a little lost in all the segments above.
The operating system share in India shows a near monopoly of Nokia’s Symbian. Android has a better chance of capturing the market share if more and more handset makers embrace it, just like HTC did.
Top 10 devices for April 2010 :
There are no typos there. All the top 10 devices are of Nokia. You might think the smartphone list would be different. A notable absence from the list is Apple’s iPhone.
Nokia enjoys a lead in a few other countries like Indonesia, Philippines and South Africa. But what it has in India is an unassailable lead.
How long will Nokia continue the lead? Who would be a second to Nokia – Micromax?
*All the pictures above are from AdMob report.
April 10, 2010
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