The smart home speaker segment, which has been Amazon’s bastion, has seen the entry of several new tech companies lately. The past year saw Chinese smartphone giant Xiaomi mark its entry with Mi Smart Speaker, and Sony India launch two new smart speakers, SRS-RA3000 and SRS-XB12. Realme, too, plans to foray into this segment soon.
Smart speakers are connected devices, which, besides streaming audio, can be voice-controlled and can relay commands to other smart devices. They are essential in operating a smart home, and hence, there is heightened interest among brands in this segment.
According to a recent report by techARC, smart speaker shipments in India crossed the one-million mark last year. The report says that the category is slated to post an annual growth of 35% for the next two-three years, as more players emerge. Amazon’s Echo devices, which come with smart assistant Alexa, had the largest share — 79% — of the market in volumes in 2020. Google Nest commanded 11% share, followed by Xiaomi at 8% and Apple at 2%, the report reveals.
Most new entrants are focussing on ‘better sound’ as their selling point. Xiaomi claims its smart speaker, which comes with a 63.5 mm audio driver, offers “high fidelity sound”. “Most of the current devices in this market focus on smartness, and not on the quality of sound,” says Raghu Reddy, chief business officer, Mi India. Reddy adds that since more than 50% consumers use these devices to listen to music, sound quality becomes an important aspect.
Sony India, too, is betting on its sound technology prowess. “The primary requirement for a speaker is good sound,” says Mani B, products manager, audio business, Sony India. Mi’s smart speakers offer Google Assistant support, while Sony’s are powered by both Amazon Alexa and Google Assistant.
Sony has priced its products much higher than competition: its SRS-RA3000 smart speaker is priced at Rs 19,990, while the Mi Smart Speaker is priced at Rs 3,999. Although Google and Amazon, too, have high-end smart speakers, priced above Rs 10,000, their devices in the Rs 3,000-5,000 range — Amazon Echo Dot and Google Home Mini — sell the most. As per techARC, the average selling price for products in this segment in January-September, 2020 was Rs 5,560.
On the retailing front, Xiaomi and Sony India are tapping both offline — for product demonstrations — as well as e-commerce. Sony India is selling its smart speakers out of 250-300 Sony Centres and multi-brand outlets such as Tata Croma and Vijay Sales in the top cities. Digital channels, experts say, contribute the majority of sales, about 90%, for the category.
Speaking the language
The appeal of smart speakers remains limited to the metro cities. “Considering that this category is still nascent, brands also need to make significant investments in educating consumers about it,” says Jaipal Singh, associate research manager, client devices, IDC India.
In order to drive adoption beyond the top cities, experts say, devices need to have more local use cases, content and languages. A better understanding of Indian languages would be especially crucial. Besides English, Amazon Alexa currently supports Hindi and Hinglish, while Google Assistant supports eight Indian languages.
Faisal Kawoosa, founder and chief analyst, techARC, says the brands that are offering Google Assistant support would find it challenging to gain market share, as the company is yet to invest in building content for India. Amazon Alexa, on the other hand, has developed 30,000 skills specifically for Indian users.