New Delhi: The offline retail<\/a> channel is expected to bounce back in 2021 to an extent, driven by the smaller towns and cities, and contribute some 60% to smartphone sales, as major brands such as Xiaomi<\/a> and Realme<\/a> double down on expanding their offline presence, say market trackers.
Growth in the online channel has jumped in the last three years – growing from 38.4% share in 2018, to 41.7% in 2019 and is estimated to be 45% in 2020. In fact, it outperformed the offline sales in the month of October, crossing 51% for the first time, according to data from IDC<\/a>.
But, analysts at Counterpoint<\/a> and CyberMedia Research are forecasting the offline retail channel to again dominate the market with a 60:40 distribution, as major brands such as Xiaomi and Realme expand their offline presence. IDC expects the same to be 55:45.
“2020 has been a peculiar year which forced consumers to make online purchases, but as things normalise, we expect consumers will again buy smartphones<\/a> through a more trusted process from a nearby retailer offering a touch-and-feel experience of the product,” said Shilpi Jain, research analyst at Counterpoint.
She added that besides Vivo, which is already offline-heavy, other volume brands such as Xiaomi and Realme are focused on expanding their offline presence in 2021 with similar discounts and offers in both channels.
India’s top brand Xiaomi said it plans to expand its footprint to reach the smaller towns and grow its offline business.
“At Mi India, offline is one of the most strategic and fastest growing business. If we just look at the pre-COVID numbers, we witnessed a 30% y-o-y growth in our retail network (Q1 2019 to Q1 2020). Today offline contributes to approx. 50% of our business and we aim to give equal importance to all platforms,” said Muralikrishanan B, COO, Mi India.
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