The Indian smartphone market is witnessing significant growth owing to the surging demand and consumption of data services. The introduction of 4G services has not only opened up several opportunities but has also intensified competition in the smartphone space. Smartphone manufacturers are now focusing on improving the features of their devices as well as fine-tuning their retail strategy to increase sales. Panasonic India too is optimistic about the strong growth prospects offered by the Indian smartphone segment. Pankaj Rana, business head, mobility division, Panasonic India, talks about the company’s key focus areas, strategies and future plans…
How has the handset space evolved in India in the past two years? What are the key growth drivers?
The Indian smartphone market is witnessing a boom. According to the International Data Corporation, the country’s overall smartphone market registered 14 per cent annual growth with a total shipment of 124 million units in 2017. Technologies such as artificial intelligence (AI) and internet of things (IoT), as well as a holistic user interface have become the key differentiators for consumers when choosing a handset.
Panasonic India has also launched its own AI assistant, Arbo, which understands user behaviour, keeps a track of all the applications on a smartphone, gathers detailed information on their habits, and informs them about it accordingly. Recently, we have also launched “Arbo Hub”, a go-to app, which provides access to multiple apps and services on a single platform.
What are the key focus areas for Panasonic’s mobility division? What is your retail strategy?
Our product strategy is based on factors such as big-view display and Corning glass protection. We plan to use Panasonic’s research and development expertise in areas like display, battery and camera to improve the quality of our smartphones.
The company’s retail strategy is to be present everywhere by leveraging different distribution and sales channels. Our focus is to ensure that online and modern retail together contribute to 80 per cent of our sales. We have collaborated with several e-commerce sites like Flipkart, Snapdeal and Sangeetha Mobiles, as well as brick and mortar retail stores.
How do you deal with growing competition in the segment?
Our focus is on design and user experience, and we strongly believe that this will create a unique differentiation in an emerging smartphone market like India. We are not looking to join any specifications or price-led wars.
What are the emerging opportunities in the Indian 4G smartphone market and how do you plan to tap these?
The 4G smartphone segment saw tremendous growth in 2017 as India again surpassed the US to become the world’s second largest 4G handset market. More than 95 per cent of smartphones shipped in the last quarter of 2017 were 4G enabled. Explosive growth in data usage, driven by attractive offers from operators has catapulted the demand for 4G phones in Tier II and Tier III cities. The government’s new initiatives like Digital India have further increased the demand.
We have shifted our focus from 2G/3G mobile devices to 4G and have planned an entire range of entry-level 4G devices, our P-Series range to enable people to adopt 4G. Our aim is to not only reach out to the young audiences but also expand in Tier II and Tier III cities.
What are your views regarding the current scenario for handset manufacturing in India? What are Panasonic’s plans in this regard?
A 10 per cent hike in customs duty on smartphone components such as camera modules and the printed circuit board (PCB) assembly is a progressive initiative undertaken by the government to foster the local smartphone manufacturing ecosystem.
At Panasonic, our endeavour is to ensure that all mobile phones are not only assembled in India but also use indigenous PCBs and we are already in the process of developing manufacturing capabilities in that direction. While the infrastructure is being set up, we are looking at absorbing maximum costs so that our end customers are not impacted. In addition, we intend to support the infrastructure creation for the industry by bringing in sophisticated technologies to the country at a fast pace through our Panasonic Smart Factory Solutions division, a leading manufacturer of special purpose machines including automations needed for PCBs.
What are your investment and expansion plans for the next few years?
We are planning to enter the Rs 20,000 plus category this festive season. We are also planning to export our smartphones from the Noida factory to South Asia, Africa and the Middle East.
What is your outlook for the handset market in India?
Smartphones are constantly becoming the sole gadget of relevance for many individuals and will soon become the major propagator of IoT in the country. Further, the evolution of technology software has opened endless opportunities. Smartphone software comprising applications and user-interface has become a deciding factor to upgrade phone. In 2018, customers will continue to opt for technology that will shape the product interface and the way users interact with their smartphones.