New Delhi, April 5 (IANS) As competition gets fierce and margins turn razor-thin in the evolving Indian market, Chinese smartphones makers are fast reworking their strategies to gain an upper hand. But the road ahead is full of uncertainties.
Take the case of Shenzen-headquartered company Huawei. One of the top three global smartphone vendors (the other two being Apple and Samsung), it is yet to create a ripple in the Indian market.
The company had a mere one per cent share in India in the last quarter of 2016, and is expected to clock 0.8 per cent in the first quarter of 2017 (according to the data provided by the market research firm Counterpoint Research).
On the other hand, Beijing-headquartered Xiaomi is not faring well in the saturated home turf but clocked over $1 billion in revenue in the Indian market last year.
Chinese internet and technology conglomerate LeEco’s is a curious yet shocking case. The Beijing-based company has buried its India growth story after creating much hype last year.
However, after the success of other Chinese players like Oppo, Vivo and Levono, all eyes are now on Huawei.
The company knows this. After securing a strong global position, Huawei has a renewed strategy for India where its sub-brand Honor is already doing well.
“It is never easy to overtake the competition in the top three positions of global leaders. But we at Huawei believe in making things possible. We have set small-term goals and are working towards them to achieve the coveted number one position,” Peter Zhai, President-Huawei India Consumer Business Group, told IANS.
“We would replicate the same strategy across all our global markets and India is definitely one of the core overseas markets that we would be focusing on,” Zhai added.
According to the US-based analyst firm Drexel Hamilton, Huawei, currently the world’s second-largest Android smartphone manufacturer, will dethrone Samsung to become Apple’s main challenger in the years to come.
“Our growth will be defined by our focus on evaluating local needs and regular investments in research and development to meet the needs of the consumers. Huawei is a leader in R&D investments and innovations with around 15 per cent of our profits being pumped into research. Our continued efforts towards innovating will help us outsmart our rivals,” Zhai told IANS.
At the global level, Huawei advanced to become the world’s 40th most valuable brand this year — up seven places from its position a year ago, British brand valuation firm Brand Finance announced this week.
For industry analysts, Huawei surely has the capabilities to achieve the same in India but it is not going to be an easy task. Huawei is yet to crack two of the world’s top three biggest markets (the US and India) but is continuously trying hard to scale up its operations in these markets.
“The biggest advantage Huawei has right now is the momentum and solid portfolio of products along with deep expertise in R&D. This has helped Huawei to partner with strong ecosystem partners in certain geographies like in Africa,” Tarun Pathak, Senior Analyst, Mobile Devices and Ecosystems at New Delhi-based Counterpoint Research, told IANS.
According to Zhai, as part of its India strategy, it has planned a well-carved, dual-brand strategy to reach out to both online and offline consumers across different strata and market segments.
“We put the ‘customers first’ and are steadily growing in the Indian market through differentiated offerings and are poised to grow exponentially in the coming years. We now have presence in over 20,000 offline stores across the country with almost 6,000 In Shop Demonstrators (ISDs),” Zhai informed.
Smartphone brands which have potential to scale up going forward have one thing is common — deep expertise in R&D.
“Entry in mature smartphone geographies demands rich IP portfolio and complying with various carrier guidelines. Hence, not many brands at this point are able to scale up to become a truly global player,” Pathak added.
As Huawei is positioned to grab the second spot globally, Samsung has launched Galaxy 8 and 8 Plus which can foil Huawei plans.
“Galaxy S8 surely has the potential to become the best-selling flagship for Samsung in the launch year. A strong momentum will not only strengthen its share in the premium segment but also help win share in the Android premium smartphone segment, which Huawei is aggressively targeting,” Pathak noted.
Zhai, however, is not threatened.
“We will focus on improving service quality and have set up premium service options to ensure that our customers receive the best-in-class service for all our products in India,” the executive told IANS.
(Nishant Arora can be contacted at [email protected])