India's homegrown mobile phone brands are giving global heavyweights a run for their money as they mop up market share in the country's $13 billion mobile phone market.
Until five years ago there wasn't a single recognizable local brand in India's handset market. However, cut-throat pricing, aggressive marketing and localization changed that; today the top-10 space is dominated by local newcomers including Micromax, Karbonn and Lava, which together account for over 30 percent of the smartphone market. Micromax's 17.5 percent share is second only to Samsung.
"With handsets manufactured in China, these guys started a mobile revolution in India," said Neil Shah, director at technology research firm Counterpoint.
Local players began gaining traction in 2008-2009 when the smartphone revolution reached China, leading China's feature phone manufacturers to search for new markets. India, which was undergoing a telecom revolution, seemed like a perfect market as policy changes reduced call tariffs and removed import barriers.
India's handset industry, among the world's fastest growing, jumped 20 percent to 226 million units in 2013 according to Counterpoint. It's the second-largest handset market globally after China.
"The time was ripe for regional brands," said Ankur Bisen, senior vice president at consulting firm Technopak, and Indian entrepreneurs gained market share by offering phones at discounts of over 30 percent to the lowest-priced foreign brand.
"We are not interested in the tip of the pyramid, but the base. 90 percent of phones selling in India are selling at less than 5,000 rupees (around $85), if [major international] brands want to ignore that [segment] it's their problem, we cannot," Shashin Devsare, executive director at Karbonn Mobiles told CNBC.
For Lava, the handset market was an "exciting space" when the company began in 2009.
"We decided to leverage the China ecosystem and took a bottom-up approach. Our research showed that no one was servicing the tier-three and tier-four markets," SN Rai, one of Lava's founders, told CNBC.
These homegrown brands quickly climbed the value chain and within a few years started selling smart phones, creating a category called "affordable premium". According to Counterpoint's Shah, most Indian smartphones sell for 4,000 to 20,000 rupees ($70 to $340), about $100 less than the iPhone or Galaxy; some even boast similar features.
Indian players were also quick to customize their phones to customers' needs, investing in research and development, design and software design centers to develop new apps.