MacNN | Apple's iPhone 4 takes off in India on 'trade-in' plan
Mac News Network View: Standard | Headlines | Categorized | Slim
Mac News Network
Mac News iPod News Reviews Forums
 

Desktop Headlines
Apple's iPhone 4 takes off in India on 'trade-in' plan
Friday, April 12, 2013 @ 12:00am

Apple has taken second place in the large and growing smartphone market in India by using a clever workaround on its pricing. While offering its iPhones at roughly the same prices worldwide, in the India market the company is now employing a "trade-in" promotion with its reseller partners that has tripled sales in the space of a week. The lowest-priced model -- the iPhone 4 -- is now outselling the iPhone 5 as buyers trade in old smartphones for a discount of at least 7,000 Rupee ($129) off the $488 price of the iPhone 4.



As with other emerging markets, contracts are virtually non-existent, which means customers must pay the full up-front cost of the phone in addition to cell service -- a serious obstacle in countries like India, where income levels differ greatly and are lower overall than in the US and other developed markets. The exchange offer on the iPhone -- unveiled just last week -- along with an instalment-plan payment schedule and strong marketing has resulted in a surge of iPhone sales, putting Apple on par with Samsung in India for the first time, according to retailers quoted in the Times of India. The traded-in phone is refurbished and sold in the country's active used-phone market, allowing resellers to make back much of the discount given to new iPhone 4 buyers. Customers with more recent or more valuable phones to trade in can get an even higher discount, easily bringing the price of a new iPhone 4 down to below 20,000 Rupee ($368) -- a key market price point for the 1.2 billion potential customers in the India market. Samsung, true to form, quickly copied the plan right down to the details shortly after it was unveiled, and the Korean company's Galaxy Grand and Note II continue to be among the top three phones. India's smartphone market is considerably more diverse than North America's, with BlackBerry and Nokia Windows 8 phones also very popular alongside Android models. Until the last six months, Apple had had difficulty gaining a real foothold in the Indian market -- but has changed to a much more aggressive strategy in India that tripled sales in the holiday quarter and are expected to substantially improve the company's position in the calendar first quarter of 2013. Apple is substantially better-positioned to win a price war with Samsung and other brands, as the margins on its iPhones are much higher than on Samsung products. The minimum $129 guarantee on traded-in smartphones means that many Indians can get more in credit towards an iPhone or Samsung device than they paid for the smartphone originally, or that the dealer can get for the refurbished trade-in on a resale -- a difference that is made up by the manufacturer. Samsung makes lower profits and has substantially higher promotional costs than Apple for its products, and this further competitiveness may end up costing the company in terms of overall profitability due to the sheer size of India's potential market. The popularity of the iPhone 4 has surprised even Apple, as it has become a durable and popular entry-level model in markets around the world, including North America. Though it will undoubtedly by replaced by the 4S as the entry-level iPhone when the next iPhone model is introduced (currently thought to happen sometime in the late summer or early fall), the iPhone 4 continues to do well on its own merits -- and its popularity in developing markets may force Apple to keep it around as an ongoing options, just as it did with the 3GS far longer than initially expected.

Comments on this Article
Print Friendly Version
Email to a Friend
Add MacNN to Your RSS Feeds
Buy from the Apple Store


Related Stories:

Today's MacNN Stories:

  • Foxconn operating 'around the clock' trying to meet iPhone 6 demand - 9:23 AM EST
  • Logitech enters home automation with array of new Harmony products - 9:01 AM EST
  • Dropbox halts automatic backups over iOS 8 compatibility issue - 7:02 AM EST
  • Briefly: Virgin Media iOS app update, Goat Simulator on mobile - 6:13 AM EST
  • Logitech launches G910 Orion Spark mechanical gaming keyboard - 5:21 AM EST
  • Briefly: Paper by FiftyThree update, Readdle updates for iOS 8 - 2:00 AM EST
  • Athentech unveils Perfectly Clear 2.0 at Photokina expo - 1:30 AM EST
  • Apple to extend iCloud security, add passwords for third-party apps - 12:14 AM EST

    Today's iPodNN Stories:
  • Motorola enables Moto Maker customization in UK, e-mails designs - 8:05 AM EST
  • Sony smartphone sales poor, company taking $2.1B impairment charge - 7:44 AM EST
  • Briefly: Spotify on Amazon Fire TV, Chrome OS to cast Drive videos - 5:42 PM EST
  • CyberPower PC adds Gigabyte laptops to customization service - 5:11 PM EST
  • Briefly: Lumix DMC-GH4 firmware update, XBMC Hub renamed TV Addons - 2:45 PM EST
  • No comments posted on this story yet. Please post yours.
    Your Comments
    In order to post comments, you must be a registered member of the MacNN Forums and logged in. Please login with your MacNN Forums username and password.

    MacNN Forums Login:

    MacNN Forums Password:

    Not a member of the MacNN forums? Register now for free.