In a big upset, Chinese brand Lenovo has beaten market leader Samsung and No. 2 Micromax in the important 4G smartphone segment in India with a market share of almost 30%.
4G smartphone market is estimated to account for around 12-14% of the total smartphone market in India and is crucial as it points towards what is in store for the future. Lenovo has been targeting this market in the earnest in recent months.
According to IDC’s latest report, Lenovo is India’s No.1 4G Smartphone brand in the April-June quarter with a market share of 29.4%.
Lenovo has been very aggressive on the entry-level 4G market and has sold over 1 million such devices in the first half of this year, according to market numbers. In terms of the overall market (which includes 2G-only and 3G-only devices), Lenovo has a market share of just 4.4 per cent share in Q2 2015.
“Lenovo has seen phenomenal growth this year with 3.3 times increase in sales in Q2 2015-16 as compared to sales in the corresponding quarter last year. Overall the shipment of smartphones to India has increased by 44% as compared to the same time period last year,” the Chinese company said.
The upset is likely to be searing for Samung, which has been bleeding market share for some time due to its inability to tap the new and emerging online distribution model.
However, in July, Samsung corrected course by embracing the online model with the launch of its Galaxy J5 and J7 smartphones.
However, Samsung phones are still priced higher than their Lenovo or Xiaomi counterparts.
As per IDC’s Asia/ Pacific Quarterly Mobile Phone Tracker, Q2, 2015 (August 2015 release), Lenovo is the fifth largest smartphone brand with 4.4 per cent share of the Indian smartphone market in Q2 2015.
While traditional retailing requires the company to provide for a distribution cost of around Rs 2,000-3,000 for a phone that costs Rs 15,000, online retail brings that down to less than Rs 300. As a result, brands like Lenovo, which is the most aggressive on the online space, have been able to offer superior specifications at substantially lower prices compared to offline or hybrid vendors.