Apple Begins New Chapter In India With Official Stores. Will iPhones Get Cheaper Now?

The opening of Apple's first retail stores in India comes amid the tech giant's broader retail push into the country.

Apple's brick-and-mortar stores in India are a great opportunity for the Cupertino-based tech giant to cross-sell products.

Source : Krishna SinhaChaudhury/ABP Live

Apple has begun a new love story with India by opening two official Apple Stores in the country -- one in the financial capital Mumbai, followed by another in the national capital Delhi today (April 20), almost twenty years after Asia got its first Apple Store. However, the pertinent questions are: Will Apple Stores in India help increase its market share in the country? Will this potentially lead to a fall in iPhone prices?

Can India become home to tens of millions of iPhone users?

India is home to 800 million mobile phone users and has the potential to have more than a billion smartphone users in the next five years, says Counterpoint Research. Indians have the sentiment of spending and upgrading to better and more expensive smartphones, thus, giving Apple a significant opportunity in terms of building a huge potential market outside of China and the US in the coming years.

The opening of Apple's first retail stores in India comes amid the tech giant's broader retail push into the country, where its market share is relatively low. The duo of Apple Stores have a tie-up with the Apple India Online Store, thus, allowing buyers to make a purchase and pick that order from Apple BKC or Apple Saket.

"Apple has an opportunity to target tens of millions of smartphones in sales every year from the current 6 million units with the growing importance of a owning good smartphone and percentage of the upper middle class. To compare, Apple sells more than 50 million units annually in markets such as China and the US. So, India has the potential to reach that scale from a domestic demand perspective in the coming years," Tarun Pathak, Research Director at Counterpoint Research told ABP Live.

Will iPhones become cheaper in India

Mumbai contributed to 10 per cent of overall iPhone sales and is the second largest market for Apple in India, after Delhi, according to market intelligence firm Counterpoint Research's "India City Level Tracker". Apple has been locally assembling iPhone models in India since 2017, but the devices, including other Apple products, remain expensive in India. For example, last year's iPhone 14 retails for $999 in the US. However, it costs around $1,600 in India. ABP Live spoke to a few Apple fans in Delhi-NCR and learnt that they're expecting cheaper iPhones from the brand.

According to Manish Rawat, Market Analyst at Ottawa-headquartered TechInsights, "Apple may create a direct sales channel by setting up new stores in India, eliminating middlemen like wholesalers and dealers. Apple may experience cost savings as a result, and consumer pricing may possibly decrease." 

"Apple may obtain economies of scale as it expands its footprint in India and makes more iPhones there. This indicates that as manufacturing volume rises, the average cost of making each iPhone drops. As a result, customers may pay less money."

Apple's brick-and-mortar stores in India are a great opportunity for the Cupertino-based tech giant to cross-sell products such as Macs, Apple Watch, AirPods, iPads and services to the growing iPhone user base maximising the revenue opportunity. Currently, Apple users in India do not have access to a range of its services, including News+, Fitness+ and Apple Pay.

"We think the branded store will further strengthen the overall experience of being in an Apple ecosystem. Apple will be able to control end-to-end user experience and this will further take its brand image to one level up. We have seen many stories around the world of consumers sharing positive purchase experiences from Apple-branded stores and India will be no different," noted Pathak.

Echoing similar thoughts, Rawat said: "It is important to note that the impact of an official store on buyers' trust also depends on the brand's overall reputation, product quality, and customer service. If the brand is already well-established and has a good track record, opening an official store in India can further strengthen buyer confidence. Overall, the presence of an official Apple store in India could potentially increase customer trust and satisfaction with the brand, by offering a better customer experience, greater access to products and services, improved after-sales support, and exclusive events and workshops."