How Chinese smartphone brands are taking over the Indian market
While India and China might not see eye to eye in the Doklam standoff, Indians’ preference for Chinese smartphones is on the rise. According to various reports, today Chinese brands have captured over 50 per cent share of India’s smartphone market. Even as Apple and Samsung have been able to hold their own, other brands have had to make way for the onslaught by Chinese brands such as Lenovo, Oppo, Vivo, Gionee and Xiaomi, which together garnering over 50 per cent share of the market. On the other hand, market leader Samsung’s market share stood at 24 per cent as of December 2016.
The success story
There is actually no rocket science in the success of Chinese smartphone brands. Their approach has been advertising heavy with aggressive marketing and the push for wider reach. Moreover, precision in responding to the demands of the market has played a major role in this success story as well.
Most of the Chinese brands are setting up manufacturing plants in India, which is reflective of their long-term plans and stabilisation, even as they are investing heavily in marketing and brand building in the country. Strategic associations with sporting leagues such as the Indian Premier League (IPL), Pro-Kabaddi League, as well as various entertainment shows has worked wonders in building a strong brand recall.
Chinese brands have been nimble-footed in responding to the ever-changing demands of the market. For example, while the Indian market has been slow in the uptake of 4G enabled phones, Chinese smartphones have been offering this technology even in their budget handsets for a while now. Similarly, they have done exceptionally well in striking a balance between pricing and features. They empower the users by offering top-of-the-line features in smartphones at a value for money proposition.
As Harish Bijoor, Brand-Guru &Founder of Harish Bijoor Consults Inc, pointed out, Chinese mobile brands have been successful for not one, but many reasons, the primary reason being the fact that these are robust brands made for a robust environment. They are priced sensibly, have just the right kind of cosmetics and their price point is irresistible.
Ambi Parameswaran, Founder of Brand-Building.com, noted that Chinese brands are tantalising Indian mobile customers as they upgrade their old instruments. “Just as the Korean brands in the last decade, the Chinese brands are trying to offer more features at a lower price. They have also learnt the need to build brand salience and Oppo and Vivo are everywhere today since they are owned by the same parent company,” he added.
“Indian brands missed a trick in not developing layers to the brand and stayed in the low margin price warrior end of the market,” Sandip Tarkas, Independent Management Consultant at Songdew. On the other hand, Chinese manufacturers saw an opportunity here and zeroed in. He added, “They copied the same strategy as the Indian brands to begin with. So, they too manufacture in China – with perhaps a bit of advantage on pricing over Indian brands since they also retained the manufacturing margins.”
The marketing might
Vivo couldn’t have found a bigger platform that IPL to herald its entry in India. This strategic association as well as the brand’s innovative campaigns have resulted in Vivo claiming the No. 3 position with a 14.25 per cent market share in India today.
Meanwhile, Oppo Mobile held 11.7 per cent market share in the offline Indian market as of January 2017, compared to 1.5 per cent share in the corresponding period last year.
India is a peculiar and diverse market with over 100 local and international smartphone brands, and hence, creating a differentiator in the market is an uphill task. Both, Vivo and Oppo Mobile have invested in market research to better understand the trends, consumer demands, and behaviour. The real challenge is to continue to find the consumers’ actual need and find that one demand which fulfils all the needs of users.
“Chinese brands have figured out that if you win the salience and top-of-mind battle, all else can wait,” said Ambi Parameswaran, adding that their effort for now has been to build brand salience, the bottom most part of the brand building pyramid. “Except for Apple and Samsung, none of the other brands have been able to build a visible image aura, although Lenovo tried, but not sure how much they have succeeded,” he further said.
According to Sandip Tarkas, Chinese brands have developed layers to their brands, which give the brands some depth and have stopped highlighting just the price and are now even able to start raising the prices as a result in certain segments. “Overall, this has ensured that they offer you a complete package – a great product sans compromise at a price that is very competitive,” he added.
All the right moves
So, what are Chinese brands doing right that other mobile brands are not doing or are doing less of?
Vivo has been active in marketing and has invested heavily in brand building and the association with IPL has not only helped in brand recall but also reach the hearts of Indians. Along with its 360-degree marketing strategy, Vivo has built a strong retail network to ensure hassle free service for customers. According to Vivek Zhang, CMO, Vivo India, “There is a strong requirement for good after sales service in India and we are striving to offer the best after sales services to our customers, while our robust offline distribution channel differentiates us in the dynamic Indian smartphone market.”
Stating that India is one of the biggest markets for Oppo, Will Yang, Brand Director, Oppo India, informed that the company takes a lot of effort in localisation to find out the real demands of the consumers and follow a “simple and focused approach” that works with the youth by connecting with platforms that the youth loves – Bollywood and Cricket.