Digital Viagra for Accessories

The accessories market was in ennui for a long time; a sudden digital thrust seems to have woken up the ice maiden

Introduction
IT peripherals and mobile accessories market is one of the lucrative markets in India. And Indian consumers in this category can be broadly segregated into Urban and rural markets. According to a survey, India’s robust economic growth and rising household incomes are expected to increase consumer spending to US$ 4 trillion by 2025#. The growing purchasing power and rising influence of the social media on electronic segment have enabled Indian consumers to splurge on good things.

A data released by the Department of Industrial Policy and Promotion (DIPP) tells us that, the electronics sector attracted foreign direct investment (FDI) worth US$ 1.80 billion between April 2000 and September 2017. Therefore we can say that accessory market is one of the toppings in Indian consumer durables business.

Market Scenario
Globally, computer accessories market is likely to grow in next few years as reportedly CAGR of 6% by 2021. The Computer accessory market can be segmented into consumer sector and business sector. According to market figures during 2016, accessory market grabbed major shares in business sector.

According to the survey by Technavio, primary growth factors identified are increased adoption of automation in the industries; non portable features of PCs have also increased consumption of accessories. This has led to increase in demand Digital Viagra for Accessories of PCs as well the accessories associated with it. This is further a push on accessory manufactures.

There is another area where accessory market is tapping customers is online gaming. Increase in number of online gamers and craze of ultimate experience is enhancing accessory investment.

Another key thrust factor of growth is assembling in India. It is one of trend where PC, laptops and mobile accessories are being assembled here and that to be at extreme cheap rates. This gives buyers and business owners an ample of options to choose from various varieties according to their needs and budget. Here third party also comes into role and these providers also get benefit in turn.

According to the data released by the Department of Industrial Policy and Promotion (DIPP), the electronics sector attracted foreign direct investment (FDI) worth US$ 1.80 billion between April 2000 and September 2017. Also the most popular product categories sold online were mobile phones and accessories. We talked to some of the leaders in the manufacturing of mobile accessories and got an insight of the market in India.

Kartik Bakshi, Country Head India, Belkin

Belkin is one of the market leader in mobile accessories. It has recently bagged nine CES 2018 recognitions and awards for its innovative products. Talking about the market scenario Kartik Bakshi, Country Head India in Belkin says this market is around 1.5 billion USD and will double in the next 5 years. “The rapid growth of smartphone adoption in India has led to an increasing demand on the Mobile Accessories segment. Indian consumers are becoming more sophisticated and demand high quality phone protection, power and connect products. The evolution in consumer behavior paves the way for Belkin to help individuals to realize the power of technology without compromising on quality and safety.”

When asked about the market share of the company, he replied, “We have a significant share in the premium mobile accessory space especially in mobile charging and protection and one focus for Belkin this year is to bring wireless charging to everyone. We have a full portfolio of wireless charging products for every use case scenario coming to market later this year. These products are specially designed to suit different consumer lifestyles.”

Rohit Dhingra, Co-founder, TAGG Digital

TAGG is another leading consumer Electronics Brand which produces range of headsets and other accessories make sure you get the most out of your mobile devices. Rohit Dhingra, Co-founder, TAGG Digital expresses that the rapid growth in mobile phone usage has created a thriving market demand for mobile accessories globally; prompting higher business sector growth. India will continue to be one of the largest consumer base for mobile phones and accessories, not just in Asia-Pacific region but across the globe.

According to the Telecom Regulatory Authority of India (TRAI), more than one billion mobile phones were being used in India by the end of September 2016. “Mobile Phone Accessories Market: India Industry Analysis & Opportunity Assessment, 2016-2026,” estimates that sales of mobile phone accessories in India reaped US$ 1,202.7 million revenues in 2015. By the end of 2026, the mobile phone accessories market in India is anticipated to reach a value of US$ 3,545.0 million.

“TAGG Digital contributes to only 2.5% of the market share and our main focus is to gain more traction and increase our market share by getting into the mainstream segments like power banks, speakers and mobile phone batteries wherein we could reach the mass. We are targeting the revenue of $5 million plus by the end of financial year.” he adds talking about the companies’ share in the market.

Mukesh Chaudhary, Country Head-India, SAARC & ME of RAPOO Technologies

Mukesh Chaudhary, Country Head-India, SAARC & ME of RAPOO Technologies also shares his views on the market scenario and overall share of his company. He says, “It’s more than 50M USD, and the market is pretty consistent for the last few years. When it comes to Rapoo’s current market share, it is about 7-8% but the idea is to reach 15% in FY2018, by focusing more on some untapped regions especially North India. Mostly we are getting tractions from Wireless Mice, Wireless Combo and Headphones. These will continue to remain our core focus products. We’ve also recently launched our gaming accessories brand VPRO in India.”

Digital Electronic Market Increased internet penetration in the country and digital thrust has played a major role in standing of electronic e-commerce market. And this market has a great future as it will keep growing with changing trends in mobile and computer market The online computers and peripherals market in India has progressed at a slow pace over the past few years. The growing sales of tablets, while the declining sales volumes for desktops and laptops have led to a stir in the growth of this market. Overall, the market has enlarged at a moderate CAGR during the review period FY’2012-FY’2015 and is anticipated to display reasonable growth in the near future.

“Ease of shopping online and on mobile, acceptability of online payments and mobile wallets, easy delivery and exchange of products as well as discount offers and cash back schemes will result in growth of online purchases of consumer electronics in India, while unreliable internet connectivity, negative price wars and rising competition are few of the major challenges to the industry growth in the future”, according to the Research Analyst, Ken Research.

According to Rohit Dhingra of TAGG Digital, “Online retailing is becoming a most popular distribution channel in emerging markets such as India, China, Indonesia, Brazil, and Russia. To gain competitive advantage in the mobile accessories market, key providers largely rely on strong distribution channels such as multi-brand distributors and retailers of mobile accessories in order to better cater to customers.”

Marketing Strategy of the Brands
The Belkin brand includes accessories for a broad range of consumer electronics with a focus on smartphones, tablets, ultrabooks and wearables. “Our product offerings are designed to create a personal, efficient and fun way for people to use technology, whether they are at home, school, work or on the go.

Some of our most popular products are our wireless charging pads and our USB-IF certified USB-C products.” says Kartik Bakshi With an increase in need for reliable phone protection. Belkin will be rolling out CES award winning True Clear Pro Advanced Screen protection (TCP In short) in the coming months. TrueClear Pro is an application system performed in store by a trained expert. The system ensures flawless, precise application for impeccable results every time. Available for Apple, Samsung and Android devices at select retailers.

Talking about the strategy he says, “The market is expanding dramatically as smartphone adoption and e-commerce continues to grow. Belkin’s products are available at the world’s biggest retailers and in 2017 we sold 1.7 products per second globally. We look forward to continuing to bring the world’s most premium quality products to the Indian market.”

“Belkin’s dedication to people-inspired design and quality informs everything that we do, from our user testing and prototyping process, to strict adherence, to regulatory compliance, manufacturing, and warranty programs, to how we market to consumers.” he adds further.

These days comfort and simplicity is drawing more demand for wireless smart phone accessories, especially in the earphones and chargers categories. If we talk about Tagg Digital; its current products portfolio includes an audio range of wired and wireless In-Ear headphones and On-Ear headphones. “Owing to the high price of wireless products, currently the demand is concentrated in developed countries. In the next couple of years, wireless mobile phone accessories are expected to become more popular. India is emerging as a big consumer of wireless products. There is a considerable growth of electronic products in India.” says Rohit Dhingra.

“We are identifying the natural partners who have direct relationships with our endusers, be it retailers, wholesalers or multi-brand stores.” he adds further telling about the GTM strategy.

Whereas, Rapoo has the business ratio of 20% Online versus 80% of Offline. Clearly its major revenue comes from offline sales. Keeping this in mind, Rapoo’s is currently focusing on C & D class cities for growth; although it’s presence in major markets is consistent. These are the cities where people still love to visit the offline stores to take feel of the products before buying.

Counterfeit Products still is pain
In the current scenario, since the mobile accessories market is set to grow 3X-4X times in coming years, so there are lot of opportunities for existing companies as well as for new companies to grow. However, markets are still flooded with fake products which effect the economy of the market.

Commenting on this issue, Kartik Bakshi says, “On a daily basis our e-commerce teams sweep the Web for suspicious third party sellers and the Belkin Brand Protection team continually works to remove counterfeit listings.”

Belkin teams are continuously fighting vigilantly against the injustices of counterfeiters and Indian consumers can too. If you people also have any grievances about the company products you can log onto http://www.belkin.com/in/counterfeits/  On the other hand, TAGG is educating the customers about the risks of buying from unauthorised sources, and recruits them to join in the effort by reporting suspicious goods and sellers.

“We email-based mechanisms for reporting suspected infringement. Further, we always update all the information about purchasing our products from legit retailers or channels on our websites and provide users a space to register their products on our website after purchase and asking them to submit the source of purchase as well.” Rohit Dhingra tells about the mechanism for tackling the issue.

Part in local manufacturing
Make In India is a great initiative and India has slowly started to transform into manufacturing sector as well. Mobile accessory brands are also taking part actively in the initiative.

Talking about the participation in the push from government Dhingra tells us “We are also looking forward to be a part of this marathon in next few years. If we talk about initial investment, then we might start with $2 million of investment.” While Rapoo is also in talks with vendors for manufacturing locally. “We are in talks with few vendors who can match our quality standards so that we can start assembling things locally in future.” says Choudhary.

                               TRENDS FOR THIS YEAR

Buying power banks that can charge multiple devices in a go
is also trending in India’s mobile phone accessories market.
By 2026-end, sales of power banks in India are estimated to
account for more than US$ 350 million in revenues.
• Various products sold as mobile phone accessories in India
have been able to attain compatibility with computers and laptops
and vice-a-versa, furthering the scope of end-use among
consumers.
• Irregular electricity & power distribution infrastructure in India
serves as a catalyst for consumption of power banks.
• Technological advancements are openhandedly welcomed
by Indian consumers, triggering a money-spinning opportunity
for sales of other mobile phone accessories such as keyboard
attachments, camera dongles, selfie sticks, thermal imaging
cameras, VR headsets, protective screens and wireless ear
buds, among others.
• Multi-brand stores are trending as the most-preferred distribution
channel for buying mobile phone accessories in India.
• Advancement in technology such as artificial intelligence (AI)
etc
• Gaming accessory market in India is definitely slated for
growth.

Government Initiatives for the market
• A new Consumer Protection Bill has been approved that will make the existing laws more effective with a broader scope.
• The mobile phone industry in India expects that the Government of India’s boost to production of battery chargers will result in setting up of 365 factories, thereby generating 800,000 jobs by 2025.
• The Union Cabinet has approved incentives up to Rs 10,000 crore (US$ 1.47 billion) or investors by amending the M-SIPS scheme, in order to further incentivize investments in electronics sector, create employment opportunities and reduce dependence on imports by 2020.
• The Ministry of Electronics and Information Technology has revised National Policy on Electronics 2012 (NPE) to focus on increasing competitiveness, innovation, R&D, promoting/incentivizing exports in ESDM.
• The Government of India has allowed 100 per cent Foreign Direct Investment (FDI) under the automatic route in Electronics Systems Design & Manufacturing sector. FDI into single brand retail has been increased from 51 per cent to 100 per cent; the government is planning to hike FDI limit in multi-brand retail to 51 per cent.

Road Ahead
By 2025, India would rise from the 12th to the 5th largest position in the consumer durables market in the world. The consumer durables market in India is expected to reach US$ 20.6 billion by 2020. Demand growth is likely to accelerate with rising disposable incomes and easy access to credit. Increasing electrification of rural areas and wide usability of online sales would also aid growth in demand.
(Facts taken from IBEF, Ken Research & Technavio survey for consumer market)