A new report from Counterpoint Research states that OnePlus beat Samsung to lead the premium smartphone market in India for the first time ever for a full quarter. This makes the company the leader of the Indian premium smartphone segment, and what’s remarkable here is the amount of time it took for OnePlus to achieve this. OnePlus entered the Indian smartphone market in December 2014, and in less than four years, the company now leads the premium segment.
According to Counterpoint Research’s latest analysis on the Indian smartphone market, the premium smartphone segment (₹30,000 and above) grew 19 percent annually and 10 percent sequentially during Q2 2018. This was because more consumers upgraded to 2018 flagship smartphones launched by different Android device makers in India. The increase in demand in the premium segment was driven by increasing offers around the new launches as compared to a year ago, with offers ranging from cashbacks, data-bundling, exchange offers, and more to reduce the affordability gap.
The strong sales of the OnePlus 6 led OnePlus to surpass Samsung to lead the premium smartphone segment in India in Q2 2018. Counterpoint noted that India remains an important market for OnePlus, contributing to almost a third of its global revenue. The user base of the company has been growing with every flagship, and this has now started into record sales for every new flagship launch. OnePlus is benefiting from strong word of mouth marketing, and the company is also leveraging social media effectively to reach out to its target user base.
Samsung captured over a third of the total premium smartphone market in Q2, and promotions for the Samsung Galaxy S9 series remained strong. On the other hand, Apple had a weak Q2 as demand for the iPhone 8 and the iPhone X began to taper off due to seasonality and challenges in terms of pricing after the increase in custom duty. Apple is said to be streamlining its channel structure as it gears up for the second half of the year.
Counterpoint states that demand is being skewed for sub-₹40,000 devices due to aggressive pricing from the likes of OnePlus. A new trend of “affordable premium devices” is said to be drawing consumers away from more expensive phones launched by Samsung and Apple. Huawei, Oppo, and Vivo are looking to be more aggressive in the ₹40,000-₹60,000 price segment, putting even more pressure on Samsung and Apple.
According to Counterpoint research, Samsung, OnePlus, and Apple contributed to 88 percent of the overall premium market as compared to 95 percent in Q1. This is said to because of entry of new players in the segment led by Huawei P20 Pro, Vivo X21, HMD Global’s Nokia 8 Sirocco, and the LG V30+.
Counterpoint summed up its points in the summary below:
Strong sales of the OnePlus 6 helped OnePlus to capture 40 percent of the premium Indian smartphone market. The company led the segment for the first time.
OnePlus was also the fastest growing brand in the premium segment (+446 percent), while Apple and Samsung’s shipments declined year-over-year.
OnePlus is now increasing its points of sale by launching offline and exclusive stores in key cities.
Samsung captured 34 percent share of the premium segment. Its shipments declined 25 percent year-over-year, though, due to decline in shipments of Galaxy S9 as compared to Samsung Galaxy S8 in 2017. The promotions for the Galaxy S9 series remained strong, helping to push sales in both offline and online channels during the end of the quarter.
Apple’s share in the premium segment was 14 percent—its lowest ever. This was because of decline in shipments for both the iPhone 8 and the iPhone X. The increase in custom duty and the absence of local manufacturing also impacted its pricing strategy in India.
Cashback and EMI offers continue to remain the major promotional activities that are leveraged by brands in the premium segment. Cashback is being used by eight out of ten models in the premium segment in the online channel.
The OnePlus 6 was the best-selling model in the premium segment. It was followed by the Samsung Galaxy S9+ and the OnePlus 5T. The OnePlus 5T sales were due to the push for sales during first half of Q2, aiming to clear off inventory in anticipation of OnePlus 6. The OnePlus 5T went end-of-life after the OnePlus 6 launch.
The Galaxy S9 series sales remained skewed in favor of Galaxy S9+ as the consumers didn’t mind spending extra (₹7,000 extra, to be precise) for the upgrade to a larger display.