An official from Amazon India has informed that the company has witnessed a 30% increase in the smartphone business which is almost as much as double from the year 2020. The growth in the smartphone business comes on the back of customers from small towns who have been buying more premium smartphones above Rs 20,000.
The Reason Behind the Growth
According to a report from ET Bureau, the category leader at smartphones and accessories at Amazon, Nishant Sardana informed that the growth in units in 2021 was led by mid-premium smartphones in the Rs 20,000-30,000 and Rs 30,000-Rs 50,000 segment. He further stated that the smartphone sales in this price segment witnessed more than 50% year-on-year growth. He added that this growth was due to the increased requirement for high-performance smartphones post covid.
Sardana stated that over the last year, there has been a pattern emerging where customers gravitate towards smartphones which are ideal for multitasking and can manage work, entertainment, and day-to-day use cases as well. The official from Amazon said that there has been an incline towards performance-centric smartphones with a better processor and larger RAM.
Talking about the reasons behind this shift to premium smartphones, Sardana said that customers of approximately 50-60 million smartphones in the price band of Rs 5,000-10,000 bought in the past 3-4 years now want a better experience. He said that the customers now want more from their smartphones such as OTT content streaming, games and more which makes them go for a better performing device and hence the growth in the sales of premium devices over Rs 20,000.
According to Sardana customers from tier 2 and tier, 3 cities have contributed to 70% of smartphone purchases which is about three times more than tier 1 cities. He added that three out of four smartphones from Amazon are being sold to small-town customers, showing the growth in demand.
Talking about the reason behind the shift in the customer’s mindset to buy from online platforms, a report from Counterpoint says that Covid-19 hit-offline retail stores, special offers, a wide variety of choices and pricing are the major reasons. The report also stated that the reverse migration of knowledge workers from big cities to smaller cities played a key role in popularising online channels.
