The entry of popular smartphone brands like Xiaomi and realme into the Indian laptop market last year was anticipated to disrupt the existing landscape, particularly in the sub-Rs 50,000 category. However, the onslaught of chip shortages and supply constraints has hindered their ambitions of making a significant impact thus far.
Challenges Faced by New Entrants
Industry experts identify two primary challenges faced by smartphone manufacturers venturing into the laptop domain. Firstly, there is a severe shortage of components in the laptop market, with only established brands managing to secure sufficient volume and supplies. Secondly, the dominance of traditional players in the consumer laptop market poses a significant barrier. The top three players command over 70 percent of the market, leveraging strong portfolios, extensive distribution networks, and robust brand marketing strategies.
Navkendar Singh, Research Director at IDC India, acknowledges the potential of new brands to disrupt the consumer laptop market but highlights the current supply challenges. He anticipates a more substantial presence from these brands once the supply situation improves, possibly in 2022.
Dominance of Traditional Players
HP Inc, Lenovo, and Dell continue to dominate the traditional PC market in India. According to IDC, the overall PC market, including desktops, notebooks, and workstations, witnessed a robust growth of 50.5 percent year-over-year in the second quarter. Notebooks accounted for over three-fourths of the market share and experienced a significant 49.9 percent year-over-year growth, reflecting sustained demand.
Prabhu Ram, Head of the Industry Intelligence Group at CMR, underscores the enduring demand for PCs driven by the pandemic-induced shift to remote work and learning. Despite supply chain constraints, established PC market leaders are poised to capitalize on this demand surge, especially during the upcoming festive season.
Opportunities for New Market Entrants
While established players dominate the mainstream market, there exists a niche market for new entrants capable of offering unique features and value propositions. To succeed, these brands must differentiate themselves and craft compelling brand messaging to build awareness and recall among consumers.
HP maintained its leadership position in the Indian PC market, followed by Dell and Lenovo. Dell recorded an impressive 86.1 percent year-over-year growth in the second quarter, securing the second position. Lenovo maintained its third position with a substantial market share.
Arvind Suraj, Research Fellow at Jawaharlal Nehru University (JNU), emphasizes the trust factor associated with established brands, indicating a preference for brands like Lenovo, HP, ASUS, and Acer among consumers.
In conclusion, while new brands face formidable challenges in the Indian laptop market, opportunities exist for those capable of navigating supply constraints and offering compelling value propositions to consumers.
