Cracker of a Diwali for mobiles with highest ever selling price

Cracker of a Diwali for mobiles with highest ever selling price

This Diwali season has seen the highest ever average selling price (ASP) for mobile phones, both online and at offline outlets.

Retailers have seen a 12-15% jump in ASPs, as a shortage of the devices in the market due to supply chain issues has forced customers to grab the first phone available, even if it is for a steeper price.

According to consultancy firm Counterpoint Research, the ASP for phones in online sales was Rs 19,000 this year, compared with Rs 17,000 last year and Rs 13,000 in 2019. “This is the highest ASP recorded for handsets for both online and offline,” partner Neil Shah said.

India’s festive shopping season this year kicked off during the first week of October, when online retailing platforms Amazon and Flipkart announced their ‘Great India Festival’ and ‘Big Billion Day’ sales, respectively. The sale period peaked during the just gone Diwali weekend.

The need for a sturdier smartphone amid continuing online education and work from home also propelled customers to go for more expensive devices.

At OLINEO Nexus India, which has 114 retail stores in Mumbai, Nashik and Bengaluru, customers had queued up during Diwali for phones costing Rs 15,000 after discounts and exchange offers, compared with Rs 9,000 last year, managing director Vibhooti Prasad said.

“Brands are not able to give great options below Rs 10,000 and that is actually pushing up the ASPs. Consumers have also realised the growing dependency on smartphones, need for quality hardware and specs, so might as well spend a little more,” said IDC India research director Navkender Singh.

A major factor for the price increase was supply chain issues. Amid a shortage of shipping containers, brands had to airlift phones. Besides, a year plus of chipset shortage and import curbs at airports and seaports in China have also crippled supplies in the consumer electronics sector.

“Due to containers and supply issues, components are getting costlier and several times air transport is used which has pushed up the end prices,” Singh said.

A Mumbai-based retailer said the rise in ASPs is not just in metros like Delhi, Mumbai, Bengaluru, Chennai and Kolkata, but also in smaller cities and towns. “The ASPs there (outside metros) may be lesser, but they have breached previous records. Customers do not want to wait for a cheaper option and have used various payment options to stretch their budgets,” he said.

Analysts said there is also a large mass market for refurbished phones market, which is making up for the unavailability of good options in the entry/budget segment and has seen healthy growth in the past year and half.

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