While there was a mixed response in the demand for desktops, there was a clear shift in the user preferences towards laptops. Change in the lifestyle and increased mobility led consumers to opt for laptops
Total PC Market in 1999: 1 million + units
Total PC Market in 2009: 7.6 million units
Number of Desktops in 2009: 1 million units
Number of Desktops in 2009: 5.4 million units
Number of Laptops in 1999: 23,038 units
Number of Laptops in 2009: 2.2 million units
This is one category which has witnessed a mixed decade. While desktops saw ups and downs, laptops kept gaining steadily.
According to the IDC India (a market intelligence and advisory services provider), the PC category, in 2007-08, registered sales of Rs 18,030 crore, down from previous year's Rs 19,954 crore. Within this, the laptop market grew at 3.5 per cent to contribute 43 per cent of the market at Rs 7,778 crore. What proved to be a dampener for the industry was the decline in the sales of desktops, which experienced a drop of 18 per cent in sales clocking Rs 10,252 crore.
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The figures show that there is a clear shift in user preferences in favour of laptops. Consider the performance in (calendar year) 2005, 2006 and 2007. Laptop sales went up by 148 per cent, 108 per cent and 81 per cent, respectively. In 2004, laptops accounted for just 5.5 per cent of the total PC shipments.
The value share of laptops (43 per cent) is significantly higher than its volume share (29 per cent) in the PC market. That's because the average sale price of a laptop - Rs 35,000 - is almost double that of a desktop at Rs 19,000.
Today, the market is fragmented with players such as HP Compaq, HCL, Dell, Acer, Lenovo, Sony, Toshiba, Wipro, LG, Zenith, Samsung and RP Infosystems. Way back in 1999, the PC business had five-six players, including, HCL, Zenith, Wipro Acer, HP and Compaq.
HP leads the market with a 30.9 per cent share followed by Dell and Acer (April-June, 2009). Falling price points and power-back-up option have further fuelled the growth in sales of laptops. The amalgamation of next generation technologies such as Bluetooth and Wi-Fi with mobile computing also fast-tracked laptop sales. The increasing penetration of laptops has also been on account of duty-free import of laptops as personal baggage.
Changing lifestyles and increasing mobility have pushed consumers towards laptops. Today, the consumer has become more specific and he, or she, not only dreams of owning a computer, but rather a lifestyle that can be flaunted.
Brands, too, are creating various touchpoints for the consumers to feel and experience the product. Marketers are expanding beyond metros to tap the potential small-town buyers. Besides making their presnce felt at multi-brand outlets, the players are also setting up exclusive stores across the country. For instance, it is learnt that over the last three years HP has doubled the number of its stores to 180. Lenovo, today, has 157 stores, while Acer has about 100 exclusive stores. And they are advertising hard.
The war has intensified with brand ambassadors - not all of them movie stars - egging the consumers on. If Lenovo has Saif Ali Khan batting for it, Acer is banking on star power of Hrithik Roshan to woo the buyers. A year ago, Dell launched a brand campaign titled, 'Take Your Own Path' targeting small entrepreneurs and businessmen. It roped in P Rajendran, co-founder and CEO of NIIT and Raman Roy, CEO, Quatrro.
The success of laptops has the desktop makers scrambling to come up with eye-catching looks and better design. Smaller, sleeker, better-looking desktops are storming the market. But industry experts predict that in the coming few years one out of every two PCs sold in India is expected to be a laptop.
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