According to Counterpoint Research, Realme became the second largest smartphone brand in India in October, 2021, with 18% market share. Madhav Sheth tells Vaishnavi Gupta that 2022 will see the company consolidating its offline presence, betting big on 5G devices, expanding its AIoT range, and foraying into the premium smartphone segment.
How important is having an offline presence for Realme in India?
We believe that an offline presence is essential for a brand’s growth in the long term. It is an important source of sales revenue in India that cannot be ignored, and, therefore, we inaugurated 100 exclusive stores in October, 2021; we have recently achieved our target of 300 stores. Now, our target is to open more than 1,300 outlets by the end of 2022. We are also looking at expanding our current chain of retail stores, from 35,000 to 50,000 stores by the end of this year. These stores will largely be in tier I and II cities. We are also working towards opening a flagship store in India.
What’s the strategy behind Realme’s 5G push? You plan to equip all smartphones priced above Rs 15,000 with 5G technology…
In 2022, we aim to democratise the 5G segment and are, therefore, actively and closely working with chipset makers to ensure that our smartphones are equipped with the latest 5G processors. 5G devices not only offer faster connectivity, but also innovation and futuristic technology, which a large portion of users are looking for these days. We were the first to launch a 5G-equipped device in India in early 2020, and have since been working on introducing more such devices. Currently, 90% of our R&D resources are directed towards developing 5G technology and products. We also have plans to invest $300 million globally in research and product development based on the 5G technology, and set up seven 5G R&D centres, including one in India.
How much has chip shortage affected your supply chain and the business?
Chip shortages have clearly affected smartphone launch plans as well as price strategies across the industry. We are actively working with mainstream chipset makers to ensure our needs of the latest and cutting-edge processors are met, and have initiated collaboration with third-party suppliers to overcome chip shortages. Despite the industry’s best efforts to absorb the price rise, everyone will eventually have to raise market operating prices of a few products, to ensure sustainability, as none of the brands, including ours, can absorb it all.
Realme held 18% of the smartphone market share in India in October, 2021. What’s the projection for this year?
In 2022, our target is to sell 35 million smartphones, and 12.8 million AIoT (Artificial Intelligence of Things) devices in the country. We are also entering the premium smartphone segment this year with our GT series. We aim to be the No.1 smartphone brand in India in 2022.
In 2021, we achieved 100% localised production for smartphones and smart TVs, and began to manufacture wearables and smart audio products. In the near future, we are aiming to achieve 100% local production for all products, including tablets and laptops.
Will Realme be foraying into newer categories this year?
We have expanded our AIoT portfolio in the Realme TechLife Ecosystem last year with the launch of laptops, tablets, air purifiers, TV sticks, vacuum cleaners, etc. We have received a good response for both smartphones and AIoT products, especially during the festive season — we sold 9.3 million units of these products. The Realme TechLife Ecosystem grew by over 40% year-on-year in 2021. We are looking at venturing into 15 new categories, and will launch over 50 AIoT products in smart TV, smart audio, wearables, TWS, laptops and tablets categories in 2022.
Do you plan to expand your accessories range?
The expansion of the smartphone portfolio will bring in a wider range of accessories, including fast chargers, high-capacity power banks, and dart chargers. Additionally, with new launches in the wearable and hearable segment, we will bring more products such as watch straps, Realme buds cover, etc. We will also offer consumers the option to design, customise and co-produce accessories in the near future.
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