Indian Brick-and-Mortar Retailers Snub Android One Phones

oyenamit writes Online shopping in India is still in its infancy but is growing tremendously to reach the mostly untapped market of 1.2 billion people. Invariably, the conflict between pure online retailers like Amazon and Flipkart and brick and mortar stores was bound to emerge. Unfortunately for Google's Android One, it has been on the receiving end of this friction. Leading brick and mortar retailers in India have refused to sell Android One handsets ever since the US company chose to launch its products exclusively online. The three Android One makers in India — Micromax, Karbonn and Spice — launched their handsets exclusively online in mid-September. When sales did not meet their expectations, they decided to release their products via the brick and mortar store channel. However, smaller retailer and mom-n-pop shops have decided to show their displeasure at having being left out of the launch by deciding not to stock Android One. The Android One phones, announced at the most recent Google I/O, are Google's attempt to bring stock Android (as on Google's Nexus devices) to emerging markets, with competent but not high-end phones.

Comments

Understanding the Indian retailers.

[140Mandak262Jamuna]

The retail sector in India evolved under very severe capital crunch. The retailer was the king in that environment. It was the retailer who takes the risk and orders goods to be sold, put up the money whether it gets sold or not. Unsold retail merchandise is never taken by the manufacturer usually in India. They borrow using a traditional chit fund system. They borrow at 24% to 36% rate of interest. Sometimes even higher than that. They usually operate at 40% margin, not counting the cost of capital. They cooperate (or collude, depending on your POV) and treat both customers and their suppliers with little mercy.

Indian customers are also very class conscious, they would eschew a cheaper product merely because their servant maids can afford them. They are used to hardball by retailer and any naive implementation of US level customer service will be gamed to death within two quarters.

Google will do well to

1 open its own stores,

2 use its strength in access to capital,

3 introduce products with differentiation so that you would not be using the same phone your driver is using,

4 deliver superior customer service to those who play fair

5 undertake price war for the in market above "servant maids and drivers and cooks" sector and below the "MNC executive, people rolling in black money" sector

Re: Good thought.

[SourceFrog]

These people likely don't know what smartphones are

Wow, good to know stone-age ignorance is alive and well still. Are you trolling or genuinely 'that ignorant'?

"India Has Higher Smartphone Usage Than the US: Study"

"Smartphone users in the country have among the highest rates of smartphone usage daily globally, spending over three hours on an average on their devices" - http://gadgets.ndtv.com/mobile...

"Smartphone explosion in 2014 will see ownership in India pass US " ... "Phone users in India and China will together buy more than 500m smartphones in 2014, comprising half of the total that will be sold in 47 key countries" - http://www.theguardian.com/tec...

But yeah, those primitive brown won't even know what a smartphone is hurr hurr

A few caveats

[8086]

Some factors to consider:

1. The Android Ones are a hard sell in India and nobody cares about Stock vs Proprietary Android. The Xiaomi Redmi 1S which sells for less than these phones and has much better specs is a huge hit in India. I bought one about a week ago for ~Rs. 6000 ($100) in a flash sale, and its already out of stock at all major online retailers. To top that, there's news of an even cheaper (~Rs. 4000) Xiaomi phone with a 4G modem coming soon. I did look at the Android One phones when I was shopping, but ended up getting the Xiaomi because of the better build quality and necessary luxuries like a scratchproof screen and non-shitty camera which the Android Ones lack. Also, there are better featured phones (with older Android in some cases) available in the same price bracket as the Android Ones from these same manufacturers. My servant bought a 6 inch Micromax phablet a month ago for ~Rs. 7000. (Yes, I'm not one of the aforementioned 'class-conscious' assholes, although they do exist). Btw, CyanogenMod works well on the Xiaomi and I now have a fully functional portable ScummVM gaming console - something that my iDevices and Samsung Androids from the past 4 years haven't been able to do without bricking/breaking warranty.

2. Brick-and-mortar mobile stores are a lot less regulated and organized, and come in way more shapes and sizes than the article makes them out to be. For instance, a lot of "mom-and-pop" phone shops in India will gladly sell you pirated software and content, non-licensed Chinese parts, and no-name Chinese phones. If you're unlucky, they'll even sell you refurbished items as new. These are highly independent wheeler dealers who do what it takes to make a profit. The real effect of this stocking ban will be that only big-name mobile shops such as those run by the major cellular carriers or the equivalents of Best Buy here in India will not stock the Android Ones, but the countless little shops will still do it.

3. Online shopping has reached critical mass only just now, i.e. the Diwali 2014 season. The technology and players have been around for a long time - I made my first online purchase here in 2000, but India-friendly options such as cash-on-delivery and zero-fee cash transfers have only recently come up. Trust is a huge issue here when not buying face-to-face from a person, because we don't have faith in the due process getting our money back if something goes wrong. If you buy face-to-face, you can at least go and rough up the guy who sold you the defective item, or so the argument went. But, times are changing, and people don't want to pay the "brick-and-mortar tax" anymore. Big retail in India is shit-scared, and there's possibly even corporate psychological warfare going on against e-commerce:
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