The 'INCH' Revolution
Today, we are living in the digital age. We wake up to the sound of an alarm, where our old age clock has more than likely been replaced by a 3.5” screen mobile phone. When on the move, we read news on a 10” tablet; in our office we start our daily schedule on a 15.6” Notebook and we finish our day by watching entertainment on a 32” LCD TV. Furthermore, when we travel, we take a 2.7” screen digital camera to capture our trip.
The digital screen has become part of our everyday lives, with different screen sizes and advancing technology constantly at the forefront of our minds. Consumers are keen to own as many of these devices as possible as now, brands are increasing their product range and models are becoming available in multiple price segments.
GfK, the Global leader in Retail Tracking of Technical Consumer Goods, carries out monthly research of these products across India. At the moment, customers have a wide variety of items to choose from – mobile phones, PCs, TVs, digital cameras and tablets – with more than 200 brands offering more than 3,000 models.
The top 8 cities in India (Delhi, Mumbai, Ahmedabad, Pune, Kolkata, Bangalore, Hyderabad and Chennai), sell more than 2 million of these products every month, with the market value standing at more than INR 1,500 crores (approximately USD 275 million).
Bigger is better
Looking at the development of this market from January to October 2011, there is a clear trend towards bigger screen sizes.
Higher growth of the premium segments, such as smartphones (occupy 17% share by value), LCD TVs (+21%) Notebooks (+13%), is leading the way. Among these three categories, products with a screen size of 19” or above have a share close to 45%, which is an increase compared to the first ten months of 2010.
GfK Research analysis also reveals that Indian consumers are buying an increasing amount of smartphones with screens over 3.2”; against the first ten months of last year they have escalated by an impressive 25% in value and now occupy more than one-third of the total smartphone value share. Similarly, in the notebook segment, 15”+ models have grown in popularity over the same period (9% value share gain) while the demand for digital cameras also shifted towards bigger screens.
Price plays it part
In terms of price segments, products in excess of INR 30,000 account for nearly 40% of the market value in 2011. However, this share has experienced a decline due to higher growth (of approximately 100%) of the INR 20-30,000 segment (currently at 27% share) in the first ten months of the year; this was a result of robust increases for PTV and smartphones.
Smartphones continued to be dominant force within the INR 15-20,000 segment, taking up a 45% share while PTVs were also on the rise (with 36% value share). Similar trends for these products were seen in the INR 20, 000 – 30,000 and 30,000+ segments.
Tablets and Webooks to impact industry
Tablets and webbooks, which are becoming more and more influential within the Consumer Electronics industry, are set to impact the Indian market in the near future. Their increasing popularity, along with the entry of new players, is expected to affect the sales of netbooks and smartphones in lower price segments.
GfK analysis has shown that, while competition in the future may pose a threat to a number of product segments, the digital market in India is a booming one, with healthy sales estimated to continue throughout the years to come.
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