Navkendar Singh, research director, Client Devices and IPDS, IDC India, said in a statement: “The ongoing supply chain challenges forced the brands to go for direct imports to meet the pent-up demand post-lockdown, especially in June, adding extra cost pressures.
"Further, this surge in demand is expected to continue throughout the first half of 3Q2020 as well, requiring a steady supply of devices in the market.
"IDC expects the market to show signs of recovery in the second half of the year, as we approach the festive quarter with the majority of consumers looking to buy low-end and mid-range devices.
IDC said total shipments in the quarter had fallen 18.2 million units as the country remained under lockdown in the first half of the quarter.
There were major disruptions in the supply chain in April, with another analyst firm, Counterpoint Research, claiming that there were zero shipments that month. IDC said the shortage of devices continued into the remainder of the quarter as factories were not operating at full capacity even after the lockdown was lifted.
Components and parts were stuck at ports waiting for clearance, especially for China-based vendors, IDC said, adding that by June sales had seen an increased mainly due to the pent-up demand from the lockdown period.
About 44.8 of shipments took place in the online channel, a high, but this was a 39% fall year-on-year in unit terms due to restrictions on delivery of electronics and also serious limits on stock for most of the April to June period.
Many offline channel partners adopted new ways of marketing by reaching out to consumers through social media platforms, WhatsApp, references, etc., for doorstep demonstrations and deliveries, as well as accepting contactless payments," said Upasana Joshi , associate research manager, Client Devices, IDC India.
"However, these initiatives were limited to big and medium-sized retail outlets in metros and Tier 1/2 cities, and were not able to arrest the steep annual decline of 56.8% for the offline channel.”
IDC said the average selling price of smartphones remained flat in the second quarter, at US$161 (A$225).
Brands were forced to increase prices due to the GST hike in April and the depreciating rupee.
The sub-US$200 segment took 84% share, a record, due to dampening consumer sentiment. The sub-US$100 segment increased to 29% share in 2Q2020 from 20% a year ago, with the Redmi 8A Dual alone contributing 33% of the shipments in this segment.
IDC said the US$200-US$300 segment fell by 71.6% year-on-year. The mid-premium segment of phones that cost US$300 but below US$500 had a share of 4.8%, a 48.4% decline year-on-year. Top
models like the Samsung’s Galaxy A51 and A71, vivo’s V19, Apple’s iPhone SE, and the OnePlus 7T were all affected.
Shipments in the premium (US$500+) segment fell by 35.4% year-on-year in 2Q20220; Apple continued to dominate with market share of 48.8%, followed by Samsung and OnePlus. The iPhone 11 and iPhone XR together accounted for 28% of shipments, with Xiaomi's Mi 10 and the OnePlus 8 series as new entrants in 2Q2020.
Feature phone shipments also fell, declining by 69% year-on-year to 10 million units in 2Q2020, making up 35.5% of the overall mobile market, the lowest for this segment.
Among brands, Samsung led the overall mobile phone market with a market share of 24.0%, followed by Xiaomi and vivo.
IDC provided the following highlights for the top five smartphone vendors:
- Xiaomi continued to lead with total shipments of 5.4 million units in 2Q2020 despite falling 48.7%) year-on-year. Four out of the top five models in 2Q2020 were from Xiaomi, namely the Redmi Note 8A Dual, Note 8, Note 9 Pro, and Redmi 8, accounting for 21.8% share. Xiaomi launched its Mi Commerce solution to create an omni-channel experience for partners, and also continued its dominance in the online channel with 42.3% share in 2Q2020.
- Samsung overtook vivo to take the second slot despite a strong year-on-year decline of 48.5% in 2Q2020 to 4.8 million units. The Galaxy M21 was among the nation’s top five shipped models in 2Q2020 and most of the online-exclusive Galaxy M series was opened to offline channels, though at higher prices. Samsung took second place in the online channel, with a share of 22.8% and was the leader in the offline channel with 29.1% share in 2Q2020. The brand also partnered with Benow and Facebook, enabling offline retailers to start sales using digital platforms, thus adhering to social distancing norms.
- vivo slipped to third, with shipments of 3.2 million units, declining by 42.9% year-on-year in 2Q2020. Though it retained its fourth position in the online channel on the back of its Z/U series, vivo slipped to the second slot in the offline channel with 26.5% share in 2Q2020. The affordable Y series was its best performer, though stock issues remained.
- realme was in fourth position with 1.78 million units shipped in 2Q2020, declining by 37% year-on-year. The vendor faced stock issues owing to factory closures through May. The affordable C3/C2 accounted for the majority of its shipments (36.3%), followed by the newly launched Narzo series.
- OPPO, at fifth position, saw a 51.0% year-on-year decline to 1.76 million units in 2Q2020. The brand had severe stock issues and even imported completely built units directly in June, as its India factory remained closed owing to multiple COVID-19 cases. The same factory manufactures devices for realme and OnePlus, and thus the latter brand also faced challenges in stocks. OPPO also launched its first 5G device, the Find X2, in 2Q2020.