“The growth story in India has always been there, but the challenge was to find a way to run it at a super scale, profitably,” Prashanth Mani says. “We understood the whole thing [gradually] and then the market was ripe for an explosion.”
Mani serves as managing director for India at Motorola Mobility (he is also executive director, Mobile Business Group at Lenovo Asia Pacific), a position he has held since 2018. He has previously worked with Samsung and Nokia. While speaking exclusively with FE’s Saurabh Singh, he says that Motorola has set itself “an ambitious goal plan of [capturing] 5 percent market share in the next three to four quarters” and that’s the reason behind the “aggression you see lately” in terms of product launches.
Motorola has been witnessing a “premium market growth of 55-60 percent year on year, every quarter (in Q1, it had a market share of about 2 percent) in the country”, Mani says, which is to say that the journey is in the right direction. The right levers for that— growth story— were found 2-3 years back and certainly not by accident.
The comeback
Motorola did not just make the first commercial mobile phone but it also made mobile phones accessible. In many ways, the Moto G series was a pioneering force behind the proverbial value for money budget phone we see today. The Redmis and Realmes would go on to use that stage to build even more compelling devices, spoiling the customer for choice with high-end specs at rock-bottom prices, knocking some legacy brands out of business and leading others to duck and cover— to regroup and restrategise. Motorola fell in the latter category.
“The first thing we realised in a hyper competitive market [like India] is that you need to run a very lean cost structure business,” Mani says, adding that “it’s no longer a game of having tons of fixed cost ahead of the curve”.
One of the first big bets to do that would involve Motorola going online— in a significant way.
Mani is quick to point out that online was “not news for Motorola” and it was –also— present there, like others, but competition definitely nudged it to make online a big focus area. Much like finding efficiency in operations to have just the right inventory and reducing service cost.
“Then we realised that when you run in a market like India, then you need to have three to four solid ecosystem partners and we built that up to scale,” Mani says.
Motorola smartphones are made in India (and a large portion to the tune of 30-40 percent is exported to North America) by Dixon’s subsidiary Padget Electronics. Flipkart is its online sales partner.
“You may be surprised to know that we have licensed our Motorola feature phones to Lava and they sell it [for us] in the domestic channel,” Mani adds.
The most critical part is the product itself, Mani says, which has to be deliberated with a “consumer first” approach and that if you were to do that, successfully, everything else would fall into place eventually.
The leap of faith
Mani says that 30-40 percent of Motorola’s phones are “true 5G-ready” now and that it is the only company to have not compromised on the number of 5G bands they support at “mass 5G price (Rs 10,000-Rs 20,000) points”.
“We tried finding out which bands will come to India and then took a big leap of faith. We said we’ll offer as many bands as possible with the sense that you can roam anywhere in the world and 5G will work [on your handset],” he says, adding that “this is a key differentiation for us as we are the only ones to have taken such a stance to push mass 5G adoption.”
Mani mentions how the n78 is going to be a primary band with maximum reach while n28 is going to ensure you stay connected in rural India and that “every band will have its significance”. Then there is the technology itself. Jio will offer stand-alone 5G services that would have zero dependency on 4G network. Airtel, on the other hand, is relying on non-standalone 5G.
“We knew that this was coming and we are ready with software upgrades for customers. So, from a customer perspective we wanted them to have a seamless experience,” Mani says, adding that “by giving them the promise of all 5G bands, we’re giving them what we call as true 5G.”
Having said that, 4G is not going to be phased out anytime soon, he believes. Rather it would co-exist with 5G due to several reasons. The larger question would be, at what price point(s), it would make sense for both smartphone makers and end-users. To do a Rs 6,999-Rs 8,999 5G phone “is out of question and nobody’s going to do that,” and if someone does do it, it would be “full of compromises” and “stand against the promise of 5G” at least at the time of writing. While at the same time, most people with a budget of over Rs 12,000 would likely upgrade to 5G.
The other question would be around data cost of 5G that Airtel and Jio and other telcos would charge, eventually.
“If they keep a differential, which is what is happening in the western markets, then 4G will coexist with 5G. It will be a slow gradual transition,” Mani adds, citing the example of South Korea where— as per Motorola’s research— 46 percent of devices are still 4G even after three years of 5G rollout.
The opportunity
Like the Motorola of old, this new Motorola 2.0 is also picky about launching premium flagships in India. What’s seemingly changed is the new-found confidence in its product portfolio and the big market opportunity that’s been created from the “gap left from one of the competitors not innovating” in that space. (Mani isn’t getting into names, but presumably he is hinting at OnePlus.)
“For every product, there is a ruthless amount of discussion which happens where we ask ourselves, does it have the edge,” Mani says, adding that “if you want to win in the premium segment, you must be differentiated.”
Apparently, 53 percent of India’s buying decisions are governed by the chipset which is why you see Motorola being so vocal and upfront about highlighting its smartphone SoCs and very often, it tends to be among the first to market with a new processor-based phone. The Edge 30 which, Mani says, has been a “roaring success” was touted as the world’s slimmest device at its price. The Edge 30 Ultra was the first to debut Samsung’s new ISOCELL HP1 200MP sensor. The Edge 30 Fusion brought a curved screen to a low-price tier.
Phones like the Edge 30 Ultra and Edge 30 Fusion are not just doing well on Flipkart but chalking up decent numbers – to the tune of 30 to 50 units a day— on Motorola’s online store as well, Mani says. He is quick to add that that’s encouraging because Motorola hasn’t even started promoting the site yet which is to say that major chunk of sales there is happening purely through word of mouth.
It’s never going to be the “major scale provider” like Flipkart, he admits, but Motorola has some big plans for its online store, regardless, including options of exchange and all finances, and 24 to 48-hour deliveries.
On after sales, the company maintains a “simplistic” approach relying on Reliance Digital resQ to service nearly 450 touch points covering all tier 3 and tier 4 towns and discussions are on to “double our service points with them.” Reliance Digital, in fact, is a key offline partner for Motorola showcasing its premium product catalogue across 150 stores. Motorola has also tied up with around 50 to 100 multi brand stores where these phones are on display. There are no plans to open any self-branded offline stores yet.
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