Reliance Jio’s aggressive pricing and promotions of its 4G feature phone has resulted in growth in this segment outpacing that of the smartphone for two consecutive quarters. According to the latest Counterpoint Research data, feature phones witnessed a 21% growth year-on-year (y-o-y) during the April-June quarter in 2018 compared with the smartphone’s 18%.
During the January-March quarter this calendar, the agency said the market was driven by the feature phone segment, which doubled in Q12018 due to strong shipments of Jio Phone, while the smartphone market remained flat y-o-y. During the January-March quarter, Jio controlled almost 36% of the country’s feature phone market, which rose to 47% in the April-June quarter.
Except Jio, the top four feature phone brands — Samsung, Nokia, Itel and Lava —registered growth in single digits for the last two quarters in the 2018 calendar year, Counterpoint data show.
The demand for Jio Phone gathered pace during during January with the company introducing a cheaper data plan, Rs 49 per month that offers free calls and 1GB of 4G data per month. Besides, Jio has been aggressively promoting the VoLTE-enabled handset along with the tariff plans.
Reliance Jio has captured almost half of the feature phone market in Q2 2018 driven by the success of Jio Phone, its highest ever, Counterpoint said, adding, “Reliance Jio is likely to maintain the growth momentum as it refreshed its Jio Phone coupled with an aggressive upgrade offer of `501 (less than $10) and bringing popular apps, including WhatsApp to Jio Phone 2”.
Reliance Jio is now the country’s largest feature phone vendor for two consecutive quarters. Jio Phone, first announced last year in July at the RIL’s annual general meeting with a refundable security deposit of `1,500 (returnable after three years), has acquired 25 million users in the last over eight months since it hit the market.
In an attempt to push sales, RIL chairman Mukesh Ambani earlier this month set a target of 100 million users in the shortest time possible and slashed the handset’s price to `501 under the Monsoon Hungama offer. All that consumers will have to do to avail this price is to give their old feature phone in return. Even the Rs 501 amount for the phone has been made refundable, after three years, if a user chooses from the three tariff plans — `49, `99 and Rs 153 — and continues to make recharges every month for 36 months.
Analysts said by cutting the price along with an exchange offer, Jio has tackled the biggest obstacle so far — what do people do with their existing handsets. Further, not having WhatsApp was seen as a major deficiency which has been tackled now.