Faced with maturing markets and political uncertainty across the world’s most developed economies, Apple chose to invest in the next boomtown — India. It’s looking like an insanely great move.
When it made the move, many people didn’t seem to understand the significance. I can still remember some of the prejudiced messages I received when I pointed out the significance of Apple CEO Tim Cook’s first visit to the nation and proselytized to the future opportunity.
The Shantaram
Now, less than a decade later, most of the bigger names in tech are now working to build their business there — with Apple on the cusp of creating its third-largest sales market.
Coming to grips with this, fresh Counterpoint analysis suggests the extent to which Apple’s move to engage with the sub-continent promises future rewards: by 2026, India is set to surpass both Japan and the UK as third-biggest iPhone market. That’s not at all unlikely, given the nation is expected to become the world’s third-largest economy by then.
This direction of travel is far from reality distortion: Even while the smartphone industry globally stayed flat in 2023, Apple generated its highest-ever smartphone sales there. It’s not just consumption, it’s also production. India produced 13% of all iPhones sold globally last year (soon to rise to 25%) and the company’s investment in the nation is generating rapid business growth.
EMEA – I = India
India’s iPhone market is finding its feet and seems on course to stand beside China and the US as Apple’s top markets. Europe and the UK markets seem destined to continue relative decline. Ultimately, India will occupy its own slot on the Apple financial reports, rather than being tucked tidily (if historically uncomfortably) inside the company’s EMEA business unit.
Counterpoint analyst Shubham Singh said: “Premiumization has started in the world’s second largest smartphone market and Apple has again got the timing right to benefit from this trend through its devices and financing offers.”
This is all good news for Apple, of course. But what might it mean for your company and what lessons can you pick up from Apple’s achievements here?
For most of us, those lessons are limited.
It was the sheer scale of Apple’s business that helped encourage India to offer the government subsidies and support that are enabling business extension there. Smaller, less powerful companies won’t be able to access the same degree of cooperation. Still, India remains incredibly focused on building up its tech industry, so even smaller start-ups might experience some positive results if they choose to move business there.
Building in, building out, building up
Apple isn’t just in the device business. It’s also in the accessories, services, and software businesses and has a pretty good track record for convincing its tribes of happy customers to purchase multiple products and services over time. Apple’s foothold with iPhone sales in India will become something more significant over time.
Like so many economies, India is also on an inexorable journey to digital transformation. One of India’s bigger software businesses is Zoho, a company that literally makes the software used by so many companies worldwide to digitize their business. As new tech businesses get into India, you’ll see them realize the big opportunity that digital-first processes always unleash in new markets. And while India’s tech economy is expected to grow at a slower rate in 2024, (thanks to global instability), it is still expected to become a $253.9 billion (net) business by the end of the year.
This is why any business that seeks to retain relevancy or build some form of future security should be searching for a foothold in India and other developing economies today. It’s also why they should perhaps have sought such a hold years ago, when Cook first visited the nation.
When the going gets tough…
History is a forward journey, of course, so it is also significant that last year Cook said, “All of these things bode well for India’s future, and we want to be a part of it. We want to be a part of it for all of ourselves, not just a part of it, from a marketing point of view. I can’t stress enough. We are all in…. India over time will be one of Apple’s largest markets…, the scale will be enormous.”
All in all, India won’t just be a highlight in Apple’s financial results in the coming years, it could also be a highlight of your own. India is not the only market on the cusp of rapid economic development, of course, from the Democratic Republic of the Congo to Vietnam, the times they are a changing. Are you?
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