Tech Transformers

Samsung's downfall in India is due to this...

Indian millenials support our brand: Micromax CEO

Clever marketing and up to 30 new phones a year have helped smartphone maker Micromax dethrone Samsung as the number one vendor in India, the company's chairman told CNBC.

Domestic device maker Micromax took 22 percent of the smartphone market share in India in the fourth quarter, ahead of Samsung's 20 percent, according to research firm Canalys.

Like Xiaomi in China, Micromax's success has been built on the back of low-cost phones with high specs.

A Micromax smartphone
Dhiraj Singh | Bloomberg | Getty Images

Sanjay Kapoor, the company's chairman, said offering phones at all price segments was key to its beating Samsung.

"Very clearly the focus for Micromax has been to understand what the consumer requirement is and to plug that consumer requirement with products, features, services, which appeal to that segment," Kapoor told CNBC at Mobile World Congress in Barcelona.

"One size fits all…does not appeal to the Indian market and therefore we started tailor-making products for different segments in the market place."

Micromax's flagship smartphones, the Canvas Hue and Canvas Nitro, target the $150 to $200 segment. It's certainly a popular price point – over 40 percent of smartphones shipments in India were in the $100 to £200 bracket in the fourth quarter of last year.

In contrast to companies such as Apple and Samsung, Kapoor said Micromax launches "close to 25, 30 phones in a year" in different segments.

This smartphone costs...$40?

The company has also worked to tap India's burgeoning millennial generation, focussing marketing on music, the Bollywood film industry and the country's biggest sport - cricket, Kapoor said.

"So our market share today on smart devices is much higher than our market share on feature phones, which was testimony to the fact that now the brand resonates with the youth," he added.

But smartphone margins have fallen dramatically, as the devices become more commoditized - and companies like Xiaomi and Micromax are unlikely to be able to sustain the business on hardware sales alone.

Xiaomi's strategy is to scale with a large volume of low-margin hardware sales and then monetize from sales of software and services, such as through its app store. Kapoor laid out a similar vision for Micromax.

"The entire strategy of Micromax is to transform the company from being a devices company to being a connected devices and services company," he said.