Low Cost Handset Dominates The Indian Rural Market

Low Cost Handset Dominates The Indian Rural MarketMediaTek India, a well known semiconductor company has recently carried out a survey with shopkeepers and mobile phone users to gauge the latest trends in this space.

The study reveals that India is still a low cost phone destination. About 50% of the users interviewed still tend to buy a handset in the Rs.1500 – Rs. 2000 range with basic functionalities.

This is similar to an earlier survey carried out by MediaTek in rural India, where 55% of the rural users too buy a low cost phone based on the recommendations of peers, friends, family etc.

The survey was carried out over a sample size of 1000 people in Metros and about 300 shopkeepers. It consisted of a mixed group of people belonging to the middle and low income groups including young people and students.

Metro Shopkeeper Suvery Report:

However, some of the usage habits of users living in metro cities are changing, and this is in sharp contrast to people living in villages and other rural areas. While a rural person would prefer having a phone with a longer battery life, thanks to longer power cuts, one living in an urban setup or in a metro city would want a better looking phone which is high on features.

Speaking about the two studies Mr. Arun Gupta, Director-Business Development, MediaTek India Technology said, “The study was aimed at identifying the latest trends in mobile buying and how does the consumer have a say in such changes. Consumers are increasingly being aware of the latest models in the market and demand for more features and better looking handsets at a relatively lesser price.”

Study says that the margin with global brands is the lowest and it also remains the most demanded with the metro consumers. With the Indian brands it’s a 50 – 50 split between higher margins and higher demand with consumers. Non-branded phones, although are the most profitable to sell for shopkeepers, aren’t really popular with metro consumers since there are no after sales services and durability is an issue too.

Many of the users surveyed bought their handsets based on the recommendation of a friend or someone known to them or based on self knowledge and research. Also about 21% of them would go with a handset which has a higher warranty period. If users are satisfied with their handset and the services provided they would wholeheartedly recommend it to the people known. 70% of them would even buy the same brand again, if satisfied.

Commenting on this study Mr. Gupta further opines, “Usage patterns of a metro user are very different from that of a person living in a village. They are less likely to compromise on looks or functionality for price.”

The study also reveals that a large number of urban users prefer a global brand over an Indian or a locally manufactured brand. Also 42% of them would prefer to buy a brand new handset rather than going with a used model.

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22 Comments on "Low Cost Handset Dominates The Indian Rural Market"


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anil gautam
September 21, 2010 5:13 pm 5:13 PM

vedioconis doing good business by following good straregies like targeting youngers and providing them good tariff plan.

July 14, 2010 3:53 pm 3:53 PM

@ Amit.G

About a week ago,I purchased Samsung GT-S5350. I think you have used it for 2 months or more,Howz the overall performance?

June 14, 2010 12:50 pm 12:50 PM

May be…
But I am using My Nokia E63, I never faced any problem with this.

Personally, my reason to choose Nokia phone is easily availability of multiple symbion software.