Smartphone sales in the top 50 Indian cities fell sharply by 30.5 per cent in November 2016 over the previous month, hit by double whammy of liquid cash crunch and cyclical softness post festive season, research firm IDC said on Tuesday. According to IDC's report, the slowdown was seen across all city tiers, with a de-growth of 31.7 per cent in tier I cities and 29.5 per cent in tier II, III and IV cities in November over October.
“This downward trend can be attributed to demonetisation and resulting cash crunch along with the cyclically lean period after festive season in October,” IDC said. The smartphone industry is believed to have sold around a third of entire years' volume during the festive season in October.
Cash purchases make up a significant portion of these purchases in both online and offline channels, hence the impact seen was immediate and more in below $200 price range (about Rs 13,600) which still makes up a large portion of the market, IDC said. Demonetisation impacted the smartphone market at almost all levels, including customer demand and stock movement in distribution channels, IDC India Senior Market Analyst Upasana Joshi said.