If Micromax taking over Samsung in the last quarter wasn’t enough, smartphone retailers in India are playing hardball with the world’s biggest smartphone manufacturer. According to a report on Times of India, brick-and-mortar retailers who deal in Samsung smartphones are threatening to boycott every Samsung product. Reason? A huge price gap between the same handset model when purchased offline or online.
A retailer from New Delhi claims a regular Samsung dealer gets a margin of about 5.5 percent while the same product is sold at hefty discount online, prompting consumers to buy it from online retail websites while they’re left with unsold stock.
Apparently, the dealers have given an ultimatum till August 15 to Samsung India to appease them or they will “black out Samsung hoardings” in their shops.
Unlike other countries, many consumers still prefer to buy smartphones and tablets offline in India and since it’s the only way to give consumers a “touch and feel” of the actual product, dealers play a very important part in the sales channel helping companies to push their product.
Physical stores are also important in smaller cities and villages, which is why local players like Micromax, Karbonn, Xolo are doing well in India despite stiff competition from established brands.
Interestingly, Samsung’s Galaxy S5 that saw the online retail price going down to around Rs. 33,000 is now hovering around Rs. 37,000. The constant price drop also led Samsung to launch Galaxy S5’s 4G variant in India, making it Samsung’s first flagship phone with Snapdragon for the Indian market.
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