Apple Inc. (NASDAQ:AAPL) has witnessed a sharp decline in its iPhone sales in India, in the first three months of 2013. Analysts believe that this drop in demand will continue in the future as well, says a report from The Times of India.


Apple iPhone 5, launched in November, initially got an overwhelming response in India. The Cupertino-bbased company resorted to marketing tools like discount schemes and monthly sales to increase sales of its devices in India, where iPhones are a pricey affair.

“The October-December quarter was an exceptional one for iPhone, but that hasn’t been the case since then,” said Manasi Yadav, who tracks India’s smartphone market for researcher IDC.

Apple Inc. (NASDAQ:AAPL) sold around 120,000 iPhone in India from January to March, which is less than the 230,000 iPhones sold in the October-December quarter of the previous year according to research firm IDC. The market share of iPhone dropped from 4.7 percent to 2.1 percent in the country. Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930), the largest smartphone maker, is the greatest rival of Apple. Along with Samsung, domestic companies such as Micromax and Karbonn are within the top three, in terms of market share.

Apple Losing Globally

Not only in India, but worldwide Apple Inc. (NASDAQ:AAPL) is under pressure regarding its lack of innovation in the new device.

Apple Inc. (NASDAQ:AAPL) has seen around a 40 percent decline in its stock since the launch of Apple iPhone5. According to research firm Strategy Analytics, approximately 10 million Smartphones were sold in India in the first three months of 2013, after which India emerged as the third largest market after the U.S. and China.

The decline in iPhone sales in India is also affecting the sales figure of national distributors like Redington, which sold around 1,100 crore worth of iPhones in the last five months of 2012. According to analysts, the number declined to 800 crore, in 2013, for Redington.

Discounts Diluted Brand Image

Faisal Kawoosa, analyst at market researcher CyberMedia Research, said that the discount schemes and other offerings could not do much to enhance iPhone sales in India. Arch rival Samsung also gave discounts and other offerings to boost its sales.

Kawoosa said that the brand image of Apple Inc. (NASDAQ:AAPL) might have plummeted due to discounts and EMI schemes offered by the company. Kawoosa added that Apple enjoys a premium image and is not looked upon as a brand that offers discounts to sell its products. Apple chose to increase market share over brand value, which may not have been the correct vision.