Apple Should Shift Focus From China To India

&l;p&g;&l;img class=&q;dam-image bloomberg size-large wp-image-43236045&q; src=&q;×0.jpg?fit=scale&q; data-height=&q;640&q; data-width=&q;960&q;&g; Photographer: Anthony Kwan/Bloomberg

Apple should begin paying more attention to the Indian market and less attention to the Chinese smartphone market.

Why? Because Apple has a growth problem in China. The iPhone maker came with a big downward&a;nbsp;&l;a href=&q;; target=&q;_blank&q;&g;revision&l;/a&g;&a;nbsp;in sales, which surprised Wall Street.

Apparently, Chinese consumers aren&a;rsquo;t as thrilled in buying Apple&a;rsquo;s products as they used to be.

Perhaps it&a;rsquo;s the slowing economy blamed by the company. But it could be growing competition from Chinese makers like Xiaomi, too. And it could be a backlash form the on-going US-China trade war.

&l;img class=&q;size-large wp-image-19440&q; src=&q;×600.jpg?width=960&q; alt=&q;&q; data-height=&q;600&q; data-width=&q;1200&q;&g; Apple&s;s Revenues

In either case, Apple must look at other countries to re-ignite its overseas growth. Like India, a country with a big fortune at the bottom of the pyramid, to use a term C.K.&a;nbsp;&l;a href=&q;;amp;qid=1412523626&a;amp;sr=8-1&a;amp;keywords=Prahalad&q; target=&q;_blank&q;&g;Prahalad&l;/a&g; a couple of decades ago.

That&a;rsquo;s the trillions in disposable income&a;nbsp;waiting&a;nbsp;in the hands of the masses of poor at the bottom of India&a;rsquo;s income pyramid.

And that spells&a;nbsp;potential &a;ndash; the kind of potential which many managers and marketers routinely overlook or write off altogether, including Apple.

The reason? These markets are either too small in terms of revenue potential or too costly in terms of the operating expenses required to tap into them.

&l;span&g;Tapping into this market won&a;rsquo;t be easy for Apple, according to &l;/span&g;Haris Anwar, Senior Analyst at&a;nbsp; &q;Apple is facing two big challenges in India, a massive untapped market for the company in need of finding other growth avenues to counter a China slowdown,&a;rdquo; says Anwar&l;span&g;.&l;/span&g;

&a;ldquo;First, it has to come up with a cheap version of its product and a price point which is acceptable to the local customers. At $1,500, the iPhone X is an extremely tough sell in a country where people love technology but can&a;rsquo;t afford it. &l;span&g;And second, Apple needs to have a large physical presence in India by opening up its stores in big cities and devising a retail strategy which works for the local market. Its relationship with the local retailers isn&s;t producing the kind of customer experience that will keep it ahead in this highly competitive market.&a;rdquo;&l;/span&g;

Anwar&l;span&g; believes that Apple has failed on both these fronts and that it needs to do its homework in apps and other services to cater to the peculiarities and specificity of the local market.&l;/span&g;

&a;ldquo;Apple also needs to improve its apps and other services to align more closely with local needs. India is a great opportunity for Apple if it can crack the local code and overcome these issues in the next two to three years,&q; he said.

And deal with India&a;rsquo;s big government regulations, I would add.


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