Here’s Why You May Not Get Iphones At Discount On Flipkart, Amazon And Other Websites

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The discount on Apple’s iPhones might come to an end after the new sales strategy adopted by the newly assigned Indian CEO, Michel Coulomb. The company is planning to build its offline channels in the country and has slashed the distributor’s margin for distributors.

Apple has halved the distributor margin to 1.7-2.5 percent and given distributor specific areas to protect those margins.Earlier, the company used to sell the iPhones to any trade partner, that allowed them to distribute the margin percent and give a discount to the customers.

According to the report, iPhone maker has also increased margins for the exclusive franchise-run Apple stores in the country from 4-5% to 5-7% to build the offline channel and prepare the market for company-owned stores, which are likely to open sometime in the 2020-21calendar years, they said.

The strategy is to increase sales from Apple brand stores in the country and stop indiscriminate online discounting which distorts brand image.

Apple India didn’t respond to queries. Online sales account for a little more than half of all iPhones sold in the country thanks to periodic discounts offered on marketplaces such as Amazon, Flipkart and Paytm Mall. That’s in contrast with the overall Indian smartphone market, in which e-commerce accounts for a third of all sales.

Apple has mandated its five distributors — Ingram Micro, Redington, Rashi Peripherals, Brightstar and HCL Infosystems — to manage sales in specific territories and with trade partners. For instance, HCL will focus on B2B sales while Ingram Micro will be responsible for managing sales to modern retail and Apple franchise stores. Brightstar will largely focus on neighbourhood cellphone stores.

Apple’s dominance in the premium smartphone segment is currently under stress as brands including OnePlus, Xiaomi, Oppo, Vivo and Motorola have started launching smartphones in the 20k plus segment. The company reported 17 percent revenue growth, its lowest in six years in 2017.

 

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