Economics Behind: Apple’s struggle in India.

I have a question for all my readers. What do you look out for while buying a new smartphone? I bet at least 50% of us will say that they look out for the price of a smartphone. This is especially prevalent in the Indian market which ranks on the higher side of price sensitivity. There is no doubt that India’s economy is one of the fastest growing in the world. With a potential of 1.3 billion consumers, why is Apple struggling in India?

Cool right, I wish I was a good at photography like that!!

It is true that Apple’s sales have grown stagnant. But, the thing is Apple is still selling almost 3 to 4 million of its products in India. Which to me is a huge number. But compare it with its more affordable counterparts, you will see a huge difference in sales. This brings me back to the basics. There are 2 ways by which Apple can sell its products. Its either someone buying an apple product for the first time or shifting from their competitor, or, the person is upgrading their current Apple product.

One vital thing to be noticed here is the 2nd point. When I say that a person is upgrading to a newer product, I a pointing on a cycle. You see most of the Android smartphones have a decent lifetime of 2-3 years. But, buy an I-Phone, you will easily be able to run it for 4-5 years. Now, compare the lifespan of these smartphones, you will see a difference. An Android smartphone making company can easily clock 2 times the cycle of sales than Apple. This would mean that the android company would generate a steady levels of profit within a cycle.

Only the OG Apple users will remember this XD.

Now compare this cycle to the sales of the smartphones. This is where you will notice why a smartphone company like Apple is struggling in India. To counter this Apple took various desperate measures like increasing number of models and adjusting hardware and software to the market specific features. Well, all of these are just helping them to survive in the market.

This brings me back to the question I had put forward to you. You see Apple’s products are expensive here. If a iPhone would cost around $1000 in the USA, then chances are, it’s going to sell in India for almost $1700-$1800. Although price is one of the issues behind Apple’s such high pricing. One of the major reasons behind this would be import tariffs. Apple manufactures most of its products in China. When the final product is brought into India, Apple has to pay huge import duties in order to meet consumer demand.

With the Covid-19 in full action, many companies have pulled out of China. Apple in particular has seen this opportunity to set up a factory in India to try and mitigate those import duties. But, India doesn’t have much of high skilled workforce, which adds on to the cost bore by Apple. In my opinion, Apple should take this burden. Although they might struggle in the short run but I am confident that in the long run it will reap benefits.

If you enjoyed reading this post, a like would be awesome. Comment below your thoughts on Apple and its sales and let me hear your stories too. If you are new here, do drop a follow. Check out my previous post here. You can now follow me on twitter as well. Stay tuned for more posts by The Antique Economist. This post is the 3rd article of my series: Economics Behind. This series will talk about various day-to-day things we may or may not notice and find an economic connection to it. Hope y’all like it.

58 thoughts on “Economics Behind: Apple’s struggle in India.

  1. This was an interesting and extremely well researched article. I truly liked your formal and professional approach to this thought provoking topic. Normally apple products are purchased by only those who are like loyalists towards the company. In a short term perspective apple does seem primitive to android users but on a long term perspective , apple is much more durable and better functioning. Exceptions does rule in certain cases but the advantages in favour of apple are quite feeble in front of Indian consumers.

    Liked by 1 person

  2. Of course, Apple products are more durable, but as I read in your previous article on Diwali. You have mentioned that most consumers will go for those items which are on sale or promotion. So most consumers are looking at the price tag when they are buying the product. It’s good that Apple wanted to open a factory in India so more people can afford Apple, but the main problem will be skilled workers, infrastructure, and other rules and regulations. Let’s hope for the better. Great Post!

    Liked by 1 person

  3. This was a very interesting article! I’m not a fan of Apple because their products are so expensive and they don’t even include everything you need (like a charger). I also hate that they make it difficult for you to fix your phone if there’s something wrong with it. I hate Apple, although I may be a bit subjective.

    All the best, Michelle (michellesclutterbox.com)

    Liked by 1 person

    • I mean your views are valid but if you find Apple expensive in your area, it’s super expensive in my area! And I am talking 50-60% more expensive..
      Thanks for the read tho! Do check out my other posts too! 😊✌️

      Like

  4. I’ve actually never had an IPhone that has lasted more than two years. I’m always a bit behind, I can’t afford the new ones, but they never last long. Yet I can’t bear to buy anything that isn’t an iPhone because I’m so used to them now. I feel trapped 😂

    Liked by 1 person

  5. This is a really interesting read. Many people have an iPhone but never think of the global reach of Apple as a company and their impact in countries across the world.

    Liked by 1 person

  6. this article is amazing! knowing bits about Apple’s status in India is very informative. for me, i’m still settling with an android device. and i think android devices are also stepping up their games. thank you so much for writing this article. this can be good for students and other researchers. 🙂

    Liked by 1 person

  7. Really? Apple is struggling in India? And wow, that’s a great number of Apple products distributed in India. Maybe Apple should also consider the demand? Apple should definitely start changing its strategies. Great post! Thought-provoking!

    Liked by 1 person

  8. I did not know that the market was as such. I hope things change and it becomes more accessible and others are able to buy at the same prices as everyone else.

    Liked by 1 person

  9. iphone 12 pro costs around 120000 in india, whereas 80000 in saudi. the return ticket to saudi from delhi is 20000, so it is cheaper to go there and buy an iphone than to buy it here. 🙂 Also, liked you piece. I think apple is not going to come here unless we have a good economic future. Inspector raj, tax terrorism and erratic power supply won’t help further.

    Liked by 1 person

  10. Great article and good to understand different markets from around the world. I guess with a massive global market, push as Apple’s, they probably feel that they can pretty much do what they want and people will still buy their products. This coming from an iPhone and Mac user!

    Liked by 1 person

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