Investment firm Credit Suisse says that the institution of installment payment plans and deep discounts in India has netted Apple up to a fourfold boost in iPhone sales over the past four months with the company moving nearly 400,000 handsets each month. According to analyst Sunil Tirumalai, Apple’s equal monthly installment (EMI) and cash-back programs have jump-started sales in India, which used to be around 70,000 to 80,000 units per month before the aggressive pricing schemes.
As a growing market, India’s smartphone sector has traditionally been dominated by low-cost feature phones while products such as the iPhone have been out of reach for the majority of consumers. The latest estimates suggest the iPhone now accounts for nearly 3% of the entire Indian market.
Apple’s “aggressive approach” to iPhone sales in the world’s second most populated nation includes extensive advertising but more importantly an interest-free EMI initiative that allows buyers to put down a partial payment on an iPhone 4 or 4S and pay the remainder over the next 6 to 12 months. Tirumalai said the following:
The 4-9% implicit discount coupled with the option of easy EMIs spread over 6-12 months became popular. Within a few months, our discussions with handset retailers indicated that iPhone sales went up 3-4x, forcing companies to respond.
If Apple can keep sales up in markets such as India, the company will continue to prosper going forward.
Source: Economic Times via AppleInsider