2013 is turning out to be some year for Micromax. The company crossed 1 million sales of its Canvas line and its Canvas HD became one of the most sought-after smartphones. We are now on the verge of seeing the Canvas 4 and yet again the company has tried to raise the bar. Our sources told us the price of the smartphone will be between Rs 23,000 and Rs 25,000. So the question is: can Micromax afford to price its next Canvas smartphone in that range? Or is it too early yet?
Canvas 4 will go on pre-order from June 28
Micromax has gone about the business of launching and pricing their phones in a very tactical and classic bottom-up approach. Every new launch tries to push the price envelope a little bit, while continuing to aim for the right value-for-money offering.
If they end up offering a phone for around Rs 20,000 with features and specs that many phones well over Rs 25,000 struggle to offer, then they will have another winner on their hands. While everyone will appreciate the premium materials and supposedly better build quality of the soon-to-be-launched Canvas 4, I think the clincher will continue to be the spec proposition. If the phone fails to over-deliver in terms of specs, then this phone launch may very well be Micromax’s first stumble, if not fall.
However, if they do manage to get the combination of pricing and specs right, and a flagship is established, then it will be good news for all their phones lower down the pecking order. It’s a gamble worth taking at this stage, and they are probably the only Indian manufacturer that can try and get away with it too.
Micromax can certainly charge a premium for the Canvas 4, but I don't think people are ready to shell out this kind of money on a brand that's never made a high-end phone before. WickedLeak has already proven that a sub-20K, full HD, quad-core smartphone is possible with the Wammy Passion Z, and this is retailing for just Rs 15,000. If Micromax does price it above 20K, then they better go one step ahead and add a lot of spit and polish to the phone. For instance, I'd love to see Gorilla Glass, NFC, GLONASS or even a metal chassis instead of plastic. From the teasers, the Canvas 4 bears an uncanny resemblance to the S4, and that's certainly no coincidence. The phone could be a tough sell if the Canvas 4 does not have the above mentioned features and more, since many of last year’s flagships have now dropped to this price.
Another of those Canvas teasers
When we got an idea of the pricing of the Canvas 4, many of our readers scoffed at the notion of paying that much for any Micromax device. My opinion though is that this is the right play by Micromax. It is after all the "IT" brand when it comes to Indian smartphones. By raising the aspiration of the brand, Micromax is trying to break away from the horde that makes up the long-tail of the smartphone market. Someone had to do it and Micromax is in the best position to give it a try. At the same time, now Micromax has also widened its target audience net and the new fish will be hungrier for things like updates and a good service network.
Flashing promos of the Canvas 4 could end up being a double-edged sword. Micromax cannot hide in the sidelines this time around. It has ensured great recall, but this also means complaints about service and quality will be amplified and might not be restricted to obscure forums. Micromax can very well price the Canvas 4 at Rs 25,000 and it could very well be a bargain in terms of specs. What it cannot do is be lackadaisical about everything that goes into building a brand, like it has been known to do in the past. If, and that’s a big if, it can truly deliver on these key areas, then the Canvas 4 pricing strategy can be called a success.
Big challenge for the brand
Can any middle segment phone maker breach the Rs 25,000 mark? I think not. The price of any phone is not merely the sum total of the cost of components and manufacturing, but the price a consumer is ready to pay for the perceived value. Sadly, no Indian phone maker has been able to convince buyers that the phones they peddle offer more value than the sum of its parts. There is more to a brand than just the device. A credible and reliable brand is built up in a very painstaking manner by ensuring that every customer who has bought into the brand promise will, at the least, get an untrammelled and satisfactory experience. This isn’t something that many brands populating the budget segment can boast of.
Micromax may have built up a huge recall with their high volume advertising, but the company has been found wanting in terms of after-sales support, customer support and over-the-air updates. Sure, the Canvas phones sold over a million pieces, but the only reason that happened was because of the high-voltage marketing campaign coupled with aggressive pricing and a cracker distribution network. Anyone attributing the relative success of the Canvas range to quality and brand experience is deluding themselves. If they do want to charge a premium—and Rs 25,000 is a premium—then Micromax has to do more than just slap the latest hardware together in a pretty-looking plastic box.
Can Micromax afford to launch the Canvas 4 at Rs 25,000? If in their business strategy bravado triumphs sound logic, they can.