India has emerged as a significant growth market for Apple iPhones, even as the US technology giant faces tepid demand for its products globally. According to market research firms IDC India and Counterpoint Research, iPhone shipments in India are expected to increase between 10-15% and 25-26% respectively in 2024. This growth can be attributed to an affordability drive, extended instalment schemes, increased local manufacturing, and the strong appeal of Apple products. The company’s introduction of extended instalment schemes spanning up to 30 months has significantly increased the affordability of iPhones for Indian consumers.
The premium segment, which accounts for only 8-10% of the overall smartphone market in India, offers significant growth potential for Apple. Currently, Apple holds a dominant market share of 65-70% in this segment. The high aspirational value attached to Apple products in India along with product upgrades and discounts has resulted in a strong consumer willingness to invest in premium smartphones.
Apple’s emphasis on expanding local manufacturing operations in India has led to reduced costs, facilitating competitive pricing. While the growth potential in India remains significant, market trackers suggest that Apple may not experience the same high pace of growth as in previous years. The base effect and market saturation may impact growth rates. However, analysts believe that Apple still has a four-year window to capitalise on the premiumization wave in India.
The growth of the premium segment in India, which even Android brands like Xiaomi are focusing on, may depend on the outcome of the general elections scheduled in the first half of 2024. Consumer confidence in purchasing premium goods will be influenced by the government’s policies and the infusion of money in the markets.
RTM Watch’s Take
India’s growing middle class and increasing disposable income present a significant opportunity for Apple to expand its market share. The company’s focus on affordability, local manufacturing, and the aspirational value of its products aligns well with the Indian consumer mindset. While challenges such as market saturation and competition exist, Apple’s strong brand image and loyal customer base provide a solid foundation for continued growth in the Indian market.
