The winds of change hit mobile gadgets hard

India's smartphone and smartwatch markets face a downturn as upgrades replace necessity, forcing brands to rethink their strategies.

- VERNIKA AWAL

India's once-booming smartphone market has lost its spark. As reported by market research firm Counterpoint, after reaching a peak with 169 million units shipped in 2021, the sector slipped into a prolonged slump, with a steep 9% decline to 152 million units in 2022 and flat growth in 2023. While experts project modest, single-digit growth in 2024, the demand downturn shows little sign of reversal, casting a shadow over India's smartphone market as it heads into 2025.

The same trend is evident in the smartwatch segment, too. Reports from market research firm International Data Corporation (IDC) India over the past two years have underscored a sharp decline in demand. While the first half of 2023 saw smartwatch shipments grow 2.3 times, reaching 23.2 million units, the first six months of 2024 tell a different story. Shipments to retailers have plummeted by a notable 18.5% as demand for smartwatches continues to slump.

These trends are not isolated. Over the past three years, India's mobile-first consumer electronics marketthe second-largest globally, only after China-has faced a prolonged downturn in organic consumer demand. This shift leaves brands grappling with key challenges as they seek ways to navigate the market slump and reinvigorate consumer spending. Yet, even as India's gadget economy remains firmly mobile-driven, finding effective solutions is proving complex.

THE KEY PROBLEM

Currently, India is estimated to have around 950 million mobile phone users, of which 700 million are active smartphone users. This leaves us with around 250 million feature phone users, while roughly 500 million people still live without any mobile phone connectivity.