Smartphone sales all set to break records this festive season

Smartphone sales are set to break records for the festive season this year, shrugging off the effects of a plunging rupee, say analysts, with some even pegging online to outpace brick-and-mortar stores for the first time ever in the October-December quarter, on the back of aggressive launches and a slew of offers.

Smartphone sales are expected to rise 24% in October over last year’s festive month, which is likely to propel growth in the three-month period ending December, which typically contributes about a third to annual sales of companies, say analysts.

“Online is growing faster than the offline channel for smartphones in October. The online channel is set to grow 30% year-on-year, while offline will grow 20%. Further, there is a 10% jump in overall handset launches over last year,” Anshika Jain, a Counterpoint research analyst, told ET.


The expected growth will dispel fears of some that the weakening rupee may force smartphones makers to raise prices, which hasn’t happened since vendors had locked in inventory at stronger rupee rates. Analysts add that growing aggression of e-tailers like Flipkart and Amazon by driving affordability through multiple financing schemes, cashbacks on debit/credit cards, attractive buy back options and strong online exclusive portfolio is helping smartphone sales surge during this festive season.

According to a techARC report, 19.1 million or 53% of the 36 million smartphones expected to be sold during the period will be sold online. This is for the first time that online contribution will be more than the legacy offline sales.

The report further says a total of $6.4 billion (about Rs 46,890 crore) worth of smartphones will be sold during the period, of which online will contribute 58% or $3.7 billion (about Rs 27,094 crore). October, or the festive month, is likely to be a record month in terms of smartphones sales volume with the share of online channel to hit a record 42% for the first time in the month, as per Counterpoint.

It added that the five days of the online sales will contribute to more than 85% of the total smartphones sold in India in those five days.

The average selling price (ASP) of smartphones in the online segment is likely to grow by 18% yearly during the festive period.

International Data Corporation’s associate research manager Upasna Joshi said the third quarter or July-September period might be the highest quarter in terms of shipment volumes ever in smartphone domain.

“During the ‘shradh puja’, which ended on October 8, consumers don’t buy anything typically. And, buying starts only during ‘navratri’. Having said that, till September, vendors sell-in to their partners, and sell-outs are happening in the entire October month. Now, with Diwali approaching, more action will take place in offline channel,” Joshi explained.

IDC tracks sell-in or shipments that are billed to tier-1 partners in the offline and online domains, thereby handset players’ high sell-ins in the third quarter or the July-September period will reflect in October.