Smartphone makers are eyeing a quick rebound in sales amid an easing of the nationwide lockdown even as they are looking to rejig their offline and online sales to enable them to tap into pent-up demand.
Phone sales in Kerala doubled from normal levels when shops opened there for a few hours over the weekend, Manu Jain, Managing Director of Xiaomi India, said, adding that the sales pattern was common in most of its shops in the state.
“We’re seeing similar trends from China, Korea, Japan etc. where lockdowns have been removed. We have seen that demand goes up significantly as lockdowns are removed,” he said, adding that a typical V curve can be seen in places after imposition and later easing of lockdown.
Jain said everyone will suffer losses in Q2, 2020, but Q3 and Q4, along with Diwali sales should go fine. Faisal Kawoosa, founder of research firm techARC, also said that pent-up demand will be seen in the days following lockdowns, but after that there should be a lull till August. He expected things to return to normal around September.
“While some of the consumers might delay their purchases at the moment due to shrinking incomes that many are facing, we are optimistic that it will all be back on track by the time of festive sales,” said a spokesperson from smartphone brand Realme.
“According to recent reports by IDC, the Indian smartphone market is expected to follow a U-shaped curve, from Q3 2020 onwards. While the slowdown will be prominent in H1 of 2020, the accumulated demand will shift to H2 2020. Maybe this festival season we can expect higher sales than last year,” he added.
Realme is expecting 100% growth in 2020 despite effectively losing two months of the year.
But tapping into this demand amid snags in transport means that phone companies have to look at innovative retail models. Traditionally, the guard rails between the online and offline businesses have been unbreakable, but Vivo and Xiaomi are now allowing customers to enquire about a product and collect it offline through the nearest retail store.
Typically offline channels account for 60% of phone sales, but movement curbs and fears of infection are expected to drive more enquiries online. However, it is easier to deliver the product through friendly neighbourhood stores because of transport hassles amid the lockdown.
“The idea is to help offline retail get back to business as soon as possible,” said Nipun Marya, Director, Brand Strategy, Vivo India. “This is a new experience for all of us. We don’t know what kind of numbers or business to expect. In the coming few weeks, we will be able to ascertain the benefits of the programme,” Marya added.
Vivo’s O2O effort is called Vivo Smart Retail and allows buyers to express their interest in a product by sending a text message with their pincode, or through Vivo India’s web store and Facebook page.
On the other hand, Xiaomi announced a new programme called Mi Commerce, which connects consumers to the nearest Xiaomi store available and they can place orders for products. Retailers will have their own web URLs that can promote them through social media etc.