Although Apple is predicted to make more money in China than US and Japan for its iOS devices, India is a market Apple wouldn’t like to ignore especially due to its massive market. Besides, there have been reports of the smartphone market going into a slump even in China due to the recent Chinese crisis. For the first time in the company’s history, Wall Street is projecting a fall in the sales. The Apple stocks have gone down to 28% from their peak in April last year. So this move can also be seen as an entry into newer avenues to create more marketing opportunities. According to this Economic Times report Apple has applied to open its official retail stores in India.
The Apple representatives are reported to have submitted an application to the Department of Industrial Policy and Promotion (DIPP). Although you can see people flaunting their iPhones and iPads in India, there are no official retail stores from where you can buy the Apple devices. There are stores from where you can purchase iPhones, iPads, Macs and iPods and other Apple accessories and you can also easily buy them from eBay, Amazon, Snapdeal and Flipkart, but these are not official retail Apple stores. Apple has been selling its devices through third-party sellers. Interestingly, right now Apple’s share in the massive Indian smartphone market is just 2%. The market is primarily dominated by brands like Samsung, Micromax, LG and many companies that can sell cheaper phones.
Along with opening stores, Apple has also sought government’s approval to sell its products online. This is the direct impact of the Indian government’s liberalization of foreign direct investment rules on single-brand retail in November 2015. According to the changed policy, single-brand license holders can sell their products directly online and the local procurement conditions for high-tech companies like Apple will be relaxed to encourage more direct investment.
Why hasn’t Apple been able to open its official retail stores in India so far?
The initial impression was that Apple just wasn’t interested in Indian market thinking that people don’t buy expensive phones. The android-phone market dominates India but a big reason is that most of the Android phones are bigger compared to the previous versions of iPhone. Now that iPhone too comes with a bigger size, just like in China, it is gaining traction in the Indian market which is indeed very big. Despite wanting to open official stores in India, due to the previous FDI norms, it couldn’t do so. Previously, foreign companies had to source 30% of their hardware and other supplies locally within three years of their initial investment.
This new development has also raised speculations that Apple may soon start manufacturing iPhones and iPads in India, considerably lowering the prices of Apple devices in India. The Taiwanese manufacturer that makes most of the Apple devices, Foxconn, recently announced that it is planning to set up manufacturing factories in India.
In 2015 India became world’s fastest-growing market for smartphones. Around 250 million Indians own smartphones and this figure is expected to double in 2018.