More phones, more offers: Festival sales to bring bigger deals, premium upgrades for buyers

smartphone

Smartphone shoppers can expect a busier and more competitive festival season this year, with brands rolling out heavy discounts on older models, fresh launches and financing offers, even as premium devices take the centre stage.

Analysts expect smartphone volumes to grow 4% and market value 7% this festive season, which spans Onam to Diwali and typically drives 30–40% of annual sales, as consumers upgrade to pricier models.

The growth will be aided by April–June’s record number of launches—the highest in two years—along with tax relief and lower GST, which should indirectly lift demand. Festive demand, however, is expected to stay split: rural and Tier 3–5 markets remain resilient on financing access and appetite for Rs 15,000–25,000 devices, while urban buyers remain cautious, scrutinising every deal.

Apple pie to grow bigger

Apple, which will launch its iPhone 17 series on September 9, is tipped to outperform rivals with strong inventory and discounts across models ranging from the iPhone 14 to the new iPhone 16 series, while Vivo, Oppo and Samsung are also positioned for gains.

Analysts said iPhone shipments are expected to log significant growth over Android brands.

Research firm IDC projects double-digit growth for Apple, rising to 4.6–5 million units from 4 million a year earlier in the July–September quarter, with momentum likely to continue in October–December.

Sanyam Chaurasia, principal analyst at Canalys, said Apple is unlikely to slash MRPs on older iPhones but will drive sales through effective discounts via bank/EMI offers and trade-ins at its retail stores and large-format retailers, mainly targeting n-1 and n-2 upgrades. “Shoppers can expect bank-led cashback, exchange boosters, and storage step-ups—like higher storage at previous price points—on iPhone 15 and select iPhone 13 models. Apple prefers predictable, effective pricing over headline cuts to protect residual values,” he noted.

“Online platforms are expected to drive the crucial first wave of sales with heavy promotions, but offline retail will also benefit as buyers now anticipate multiple sale phases. We expect 4 percent volume and 7 percent value growth for smartphones this festive season. Premium phone sales will drive growth,” said Tarun Pathak, associate director at Counterpoint Research. “Quick commerce is emerging as a new lever for last-mile festive sales.”

“As per our study, 65 percent of people are planning to spend more than last year, while 20–25 percent will spend on the same brand. Overall, GST impact and personal tax will have a positive impact on festive handset sales,” Pathak said.

Apple and Samsung enter the festive season from a position of strength—Apple riding on brand pull, financing-led upgrades, and a widening retail footprint, while Samsung leans on its broad portfolio, disciplined operations, and channel muscle, Chaurasia said.

"Among Chinese brands, Oppo and Vivo benefit from strong retail conversion and promoter networks, while Xiaomi and Realme stay aggressive in the entry and mid-tier with sharp value and faster refresh cycles. Ultimately, brands that combine portfolio depth with tight retail execution will be best placed this season," he added.

OnePlus, Motorola, and Nothing may surprise in mid-premium with clear value propositions, he said.

Retailers to join the party

Despite a cautious outlook, analysts expect offline retail to have a better season this year.

“It will be better than last year, and they are seeing better demand due to bundling and financing. We interviewed over 100 retailers, and they see growth this festival season. Premium will see double-digit growth in the mainline channel,” Pathak said. Unlike earlier years, sales in physical retail now begin quickly after the first wave of online promotions.

Chaurasia said that handset companies and retailers' focus will be on protecting brand equity and ASPs while moving specific models. "Deeper markdowns will appear post-Diwali on slow movers. Android players will lean on effective price tactics like bank cashbacks, longer no-cost EMIs (18–24 months), trade-ins, and some insurance bundling in high-end, instead of steep list-price slashes."

Vendors, he said, are relying on retail push, with gifting and financing driving sell-through, while online demand is patchier.

"Rural markets are absorbing stock well via EMIs and trade-ins, but urban demand is cautious. GST reforms boosting retailer liquidity should help normalise stock, provided sell-through outpaces sell-in by Diwali," Chaurasia said.

Samsung and Xiaomi are also banking on festive demand, rolling out offers for both offline and online channels while targeting premium smartphone upgrades.

Samsung is betting on strong demand from tier-3 and 4 cities and rural markets, with ecosystem products such as Galaxy Buds and wearables expected to boost value growth.

“Growth will likely be stronger in tier-3 and tier-4 markets, supported by healthy consumption and a good monsoon… these regions have large young populations, many of them still on 4G, and they’re aspirational as well as tech savvy,” said Raju Pullan, head of mobile business at Samsung India.

Xiaomi is also pushing premiumisation to lift its average selling price (ASP).

“We are very excited about the festive season. The key priority is to move up ASP. We’ve had a very exciting launch of Redmi 15. Along with that, we want to make a strong claim in the Rs 15–20,000 segment… I think we’ll start to see that both in this festive quarter, Q4, and next year,” said Xiaomi India chief business officer Sandeep Arora.

Both Samsung and Xiaomi are sharpening their focus on offline retail, expecting robust growth.

“We’re also increasing investments in the offline channel. For example, we’re expanding our Samsung Experience Consultant (SEC) programme by 20 percent, covering tier-2, tier-3 and some tier-4 cities,” Pullan said. Over 30,000 retailers have undergone certification programmes.

“We are also expanding promoter strength and ensuring retailers can demonstrate AI features. Affordability is also key. We are also launching special festive schemes,” he said.

Xiaomi’s is doing something similar. The focus is to grow business with mainline partners. “Their demand from us is to grow not just in volume but also value. They appreciate the investments we are making in the channel like more promoters, more display counters. It shows our commitment,” Arora said.

Still, IDC expects overall demand to remain subdued in the July–September quarter, projecting flat shipments of 45–46 million units after a strong second quarter and early product launches.

“In the first quarter of 2025, the market saw a slow start with a 5.5 percent decline to 32 million units. This was due to carryover inventory from the 2024 festive season. However, the market rebounded in the second quarter, with a 7.3 percent year-over-year increase to 37 million units,” said Upasna Joshi, an analyst at IDC.

Joshi said while monsoon sales are already over, high inventory may weigh on Q3, with Diwali, which comes early this year, likely pulling down Q4 shipments by mid-to-high single digits. Overall, 2025 shipments are expected at 148–150 million units, 1–2 percent lower than 2024.

By price, the sub-$100 category could see some traction from existing models but $100–200 band phone sales are expected to decline.

The $200–400 range may remain flat, while phones priced above $400 are projected to witness strong double-digit growth.

“Discounts on previous-generation flagship phones, price cuts on 2025 models, and deals such as platform promotions, bank offers and trade-in programmes will drive this segment,” Joshi said.

Chaurasia said the festive demand momentum is likely to extend beyond Diwali, driven by post-festive deal-hunting and the GST cut on large appliances, which is boosting large format retail footfall and liquidity, enabling retailers to widen assortments, bundle offers, and uphold average selling prices (ASPs) without deep discounting.