 "Sudhin Mathur")
The Indian market is unique in that there is equal opportunity in every price band, Sudhin Mathur tell Ritwik Sharma
How challenging is it to be conspicuous among a number of Chinese smartphone players in India?
First of all, there is a multitude of players. India is a huge market with almost 110 million phones being sold on an annual basis, and it attracts a lot of players, be it local brands, multinationals or Chinese. We need to look at creating our own space in this very competitive market. Based on the IDC report that has come out for the last quarter (April-June), the market on year-on-year basis grew by four per cent and we grew by almost 26 per cent. We are the No.2 brand by value and No. 3 in terms of volume.
In terms of what has worked for us, we are the No.1 brand in the online space. So that has been one of our clear strategies for the last one or two years - focus on a large market that is almost one-third of the smartphone business. Next I believe is our strategy in terms of product and innovation. For most brands, it's about bigger screen size, better camera, better RAM, etc. What we have looked at is to bring consumers to the centre and bring in more meaningful innovation and technology - whether it was the Shattershield technology where the glass doesn't break on one of our products or most recently the modular Moto Mod. Also from a software point of view, our innovations have helped differentiate us.
Lenovo has a strong mindshare as a PC maker. What are the ways in which it has tried to outgrow this perception among customers and establish itself as a smartphone company?
Yes, Lenovo is the No. 1 PC company in the world and in India also we have a strong presence. However, in the last three years we have transformed from a PC to a PC-plus, which is a smart connect device company. So as an organisation Lenovo is into the three categories of smart connected devices - PC, tablets and smartphones, and of course now in the server space too. Probably we are the only brand in the technology space that has all these end-to-end solutions, whether to a retail consumer or an enterprise.
Smartphone is a much larger category than PC. PCs sell about 12-13 million units a year in India. So I think the scale and size of the smartphone market and the consumer segments are very different. We have been able to create space for ourselves as a smart connected devices company. And we have had great success in the products that we have launched due to the scale.
Can you explain your retail distribution strategy? Is Lenovo focusing more on the online channel than on physical retail?
I would not say we are more dependent on the online channel. Like I said, India is a large market and online is now almost one-third of it, which means 35-40 million phones get sold in this space. Each channel offers an equal amount of opportunity and we are working very closely on both. It's the consumer who is deciding whether to go online or offline. Of course, we are stronger in the online space at this point of time. We are the No. 1 player in this space with almost 19.2 per cent share. Having said that we have a clearly defined offline strategy. In the last quarter, we grew 5.8 per cent in comparison to the previous quarter in the offline space. We have close to 300 partners, reaching out to more than 10,000 retail outlets. Of course the competition in this space is very different from online, so we need to look at different price bands, competition and grow our share.
Which segment of the market are you targeting primarily?
We believe in a market like India, different price bands offer different opportunities. The first-time upgraders who are upgrading from feature phones to smartphones are looking for a good device which is let's say sub-Rs 6,000. That's a large part of the market, which is about 45 per cent. The Rs 6,000-18,000 band is also 45 per cent of the market or maybe more. The uniqueness of this market is that there is equal opportunity in every price band. We focus on all the segments, starting from $100 and going up to $400 and above. We have had the greatest success in the $100-300 band, which is almost 50 per cent of the market. I believe it's not about being price-conscious for consumers in India, but value-conscious, which is why the cheapest is not the largest selling.
