India’s offline mobile phone market is witnessing a sharp slowdown, with sales plunging nearly 40% in the last 10 days, according to industry executives and market trackers. The slump is attributed to consumers holding off purchases in anticipation of heavy discounts during Flipkart and Amazon’s flagship festive sales, which began at midnight on Monday.
Online Discounts Lure Buyers Away
Both e-commerce giants rolled out steep discounts on premium smartphones, especially Apple’s iPhone 16 series and Samsung’s Galaxy S24 FE, which immediately diverted consumer attention online. Offline retailers say they are struggling to match the aggressive pricing strategies of these platforms. “Stocks of high-demand models are mostly diverted to online channels,” said Kailash Lakhyani, chairman of the All India Mobile Retailers Association.
Apple and Samsung reportedly supplied around 2 million units each for the initial sale, while other brands collectively provided 3–4 million units. The shortage of popular models at offline stores has forced retailers to hold onto older iPhone variants, which they’re unable to sell due to customer demands for similar discounts.
No Relief From GST, Expectation of Recovery
The industry’s long-standing demand to reduce GST on mobile phones from 18% — by classifying them as essential goods — remains unmet, offering no relief to slowing sales. Despite this, offline retailers remain hopeful, predicting that footfall will recover once online inventories deplete. They expect sales to double month-on-month and grow by 20% year-on-year during the festive season.
Online Platforms Witness Record Demand
Early insights from Counterpoint Research show a strong start for e-commerce platforms, with festive season smartphone shipments expected to rise 4% year-on-year in volume and 11% in value, driven by high-end models.
Platforms also deployed tactics to fuel demand. According to CCS Insights’ Ekta Mittal, Flipkart leveraged FOMO (fear of missing out) by releasing inventory gradually and frequently tweaking bank offers and delivery schedules. The iPhone 16 base model was priced as low as ₹51,999, about 35% below its launch price, although prices of popular models surged by 5% due to overwhelming demand.
While online platforms are thriving, offline retailers are bracing for a delayed sales recovery — one that typically accelerates closer to Diwali.
