Having shifted production of several of its flagship smartphones to India, Apple could be all set now to launch the first of its own digital stores in the country. And this could happen as early as in September, recent reports have revealed.
Bloomberg quoted unnamed sources at Apple Inc. to suggest that the company aims to take advantage of the federal Indian government's relaxation around the foreign direct investment rules that now allows single brand retail. Apple's plans for an online store in India got delayed due to the Covid-19 pandemic.
During its Apple Annual Shareholders meeting held in March, CEO Tim Cook had confirmed that Apple is looking to inaugurate its first retail store in India by 2021, while the online store is set to go live by the end of this year. Looks like the company has speeded up its act for some very sound reasons.
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Why Apple's move is a timely one
Online retail is growing
For starters, the Indian online retail business appears to have emerged from the effects of the lockdown as evident from Amazon India's recently concluded Prime Day sales. Prime Day saw members from over 97% pin codes of India shop across multiple categories. More than twice as many customers signed up for an Amazon Prime membership during Prime Day 2020 compared to the last Prime Day, with over 65% of new members from outside of the top 10 cities.
India's festival seasons starts now
The online sales platform could start operating in September in preparation for India's annual festival season, which got kick-started with Ganesh Chaturthi last week and culminates with Diwali and Christmas. With the launch of its online store, Apple could be readying for some special offers on select smartphones post the iPhone 12 launch event next month.
Some scope for discounts, perhaps?
With both the iPhone 11 and the iPhone SE 2020 now being manufactured in India, Apple saves up to 20% on import duties that could provide the cushion that the company needs to lure its fans to the online store. The company also has partnerships with several offline chains as well as online marketplaces such as Amazon and the Walmart-owned Flipkart.
The anti-China sentiments
Our sources in Apple's franchise network told us that Apple's decision to go ahead with its own stores at this juncture could also be a step towards winning customer loyalty in the wake of the tough competition posed by Chinese makers OnePlus as well as South Korea's Samsung. "The anti-China sentiment is readily available for Apple to utilize," said a store owner in Bangalore.
Offline stores in 2021
The latest move from Apple, when it materializes, would be the outcome of years of hard lobbying with the powers in New Delhi to relax regulations that mandated companies to source at least 30% of their components locally, before applying for a license to start single brand retail stores in the country.
The company has also been actively considering an Apple Store in India for quite some time now. In October 2019, it had received the requisite clearances for setting up its first company- owned-and-operated store at the Bandra Kurla Complex (BKC) in Mumbai.
There are reports following Apple's nudge to its contract manufacturers to bring investments into India to boost production, that a second brick-and-mortar store could come up in Bangalore. Our sources in the Apple India ecosystem claim that the company already identified space in India's technology hub and that it would be in the central business district itself.
Having made a start towards 'make-in-India' iPhones this year, Apple is probably waiting for 2021 to fly down CEO Tim Cook to inaugurate the stores, coinciding with his competing 10 years at the helm of the company. Cook completes nine years as CEO of Apple today.
