While we suffered with profitability in the first few years, in the last two years, we have been focusing on smartphone growth, from which we have been receiving 90% sales in the last three months. India is one of the fastest smartphone growth markets witnessing sales of 2 million a month and 24 million smartphone sales a year compared with 15 million last year. We have also refined our offerings to only GSM phones – almost all of which have 3G capability, as we strongly believe CDMA is a dead technology.
we help customers install software and and demonstrate the phone's functionality. This is useful, as across manufacturers, at least 1-2% of phones are dead-on-arrival and do not work, in which case they can also be returned to the store within 3-7 days.Besides, we also offer extended warranty of 1 year, at 2-2.5% of the handset cost, as we believe most smartphone issues appear 1 year post purchase, once the phone's warranty has expired. The Mobile Store also offers after-sales maintenance, free of cost if the handset is bought from the store – and a minimal fee for repairs of handsets bought elsewhere.
The pricing on our online portal is 3-4% lower than that at the Mobile Store, similar to industry offerings. Besides, online handset sales still make up only 10-12% of cheap unlocked smartphones purchases today. That said, we believe online presence presents a huge opportunity for us, and we receive huge traction on our website, thanks to freshest inventory, brand name, regular promotions and pre-booking.
We pioneered with the EMI option for smartphone sales two years ago, which contributes 30% to our smartphone sales today, from 2-3% when it was introduced. EMI is popular because while the pricing of smartphones are similar worldwide, salaries are varied, and hence, there is a gap between aspiration and affordability, which EMI options help bridge.fd5F4ghD
While we have tied up with 10 major bands for credit card EMIs, two months ago we launched an EMI scheme for non-credit card holders, where the customer is given the phone purely based on identity proof, an ECS form and a cancelled cheque. Besides, while Indian brands were only focussed on cheap feature phone offerings, now they are all offering quality i9500 S4 smartphones, and spending a lot on advertising, which has changed the Indian consumer's mindset towards Indian brands.
Qualcomm purchased a small stake in Alcatel-Lucent as part of an R&D deal to make new wireless transmitters for the small cell base station market. We may not always need a new phone but we can't always use more coverage, and the base station market will continue to grow worldwide.
Time will tell if a smartphone slowdown does take place. T-Mobile has shaken up the market with its no-contract plan but it's way too early to predict an impact. Still, if the hints bear out, it's rather remarkable that smartphones managed to do in about five years when PCs needed 30 years to do, and that is go from cool to boring, necessary evil.
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