Google Android One: The Channel Dilemma*

Abstract:

The case discusses the launch of the Android One initiative by Google, under which the company partnered with mobile handset makers to bring out low priced, smartphones targeted at emerging markets like India. By the time Android One was launched, the Indian market was flooded with low priced smartphones from Motorola and Chinese manufacturer Xiaomi, who sold their handsets exclusively online through retailers like Flipkart and Snapdeal. The Android One partners in India Micromax Mobiles, Karbonn Mobiles, and Spice Digital, also launched the phones through online retailers. But even after two months the sales were not as expected. Then the handset makers started to sell the handsets through conventional retailers. However, several retailers were not in favor of selling the phones showing their displeasure over the launch of phones exclusively online. Thus, the Android One phones in India were caught in a channel conflict, between the traditional retailers and online retailers.

Issues: » Understand Internet as a marketing channel. » Understand how channel conflicts occur. » Analyze the difference between channel conflict and competition. Introduction In September 2014, the US-based search engine giant, Google Inc. (Google), launched the Android One program in India. Under the program, Google partnered with mobile handset manufacturers to bring out affordable high-quality smartphones in emerging markets. In India, Google partnered with India-based mobile handset manufacturers, Micromax Mobiles, Karbonn Mobiles, and Spice Digital, to come out with Android One phones...

Questions for Discussion:

1. What do you think of Google’s strategy of launching the Android One phones only online?
2. How can Android One compete against formidable competitors like Motorola and Xiaomi?
3. What should Google’s next course of action be?

Key words:
Channel conflict, e-commerce, Android One, Smartphones, offline retailers

* This caselet is intended for use only in class discussions.
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