OnePlus already has 62% of the online market shares: Vikas Agarwal
OnePlus is on a roll to capture and establish itself as the “it” mobile phone brand for its consumer base, that the brand prefers to call the ‘OnePlus Community’. Just three years old in the Indian market, OnePlus has built up a unique proposition to its sales point, quietly establishing its monopoly in its sharply targeted consumer line.
The latest strategic collaboration between OnePlus 5T and a generation defining Star Wars movie cult, ahead of the launch of the limited edition series in India, also opened up a world of possibilities for both the brand and its users. The two partnered to bring about unique features to its latest and limited edition OnePlus 5T Star Wars Special Edition mobile phone as a ‘Special Gift’ for its users.
In conversation with Adgully, Vikas Agarwal, General Manager, OnePlus India, explores the many facets behind the rapidly growing mobile phone brand in India, building the OnePlus community, breaking the monopoly of well-established mobile phone brands in India, the Amazon connect and much more. Excerpts:
OnePlus has already gone from being a start-up to a growing mobile player in the Indian mobile sector. What are the differentiators that OnePlus has brought in the highly fragmented mobile domain?
We are still a very fresh company in India. The industry is so big and competitive that we need to have that start-up energy to compete and survive in this industry. We do have a strategy to stand out in this industry and it is to focus on one product a year, which is better than the products produced by the competitors. So, we put in our energies in one product that is highly efficient and appreciated by the OnePlus Community. We develop for our users who understand our product and not really for everyone. If you see, One Plus is available only online. It is largely a pull-driven marketing that we follow. We do not use push-driven strategy, wherein we try to advertise and showcase our product on every possible sales channel and then expect the users to buy the product. Instead, we rely on the consumers to discover the product by reviewing the product, by reading others’ experience, customer testimonials available on various digital channels and go to Amazon and buy it.
The first element of our strategy is to have best-in-class product and then rely on word-of-mouth and positive feedback. Secondly, maintain the product and customer connect that we have nurtured over the three years and be very open and transparent towards our users. We have a constant engagement channel with our consumers and can be reached over Facebook, Whatsapp and Twitter for their feedback. This gives us a very personalised and long lasting connect with our community. This gives us a very unique positioning and advantage over our competitors, which is very difficult for others to replicate. Thirdly, our unique business model is such that we are present only online, giving us a better structure over our competitors.
Where do you see India as a priority market for OnePlus as a whole?
India is our most important market. The entire global company structure is aligned to make sure that India is in the priority position. The reason why we have India as the most important market stems from the response we have seen from our community. It’s about the excitement and engagement that we have seen in the Indian market for OnePlus, which is admirable. Although it was launched one year later than the global launch of OnePlus, in the first year itself, the Indian response was overtaking the global response. Thus, we’ve had a great opportunity in India.
The second reason is the business opportunity. The kind of connect that we have with the users in India, we are translating that into our business model. So, globally India is our biggest market. In India, OnePlus is the second biggest brand that we operate in; it’s almost one-third of the market and that is when we operate only online, where we sell only on Amazon. On online, it’s around 30 per cent of the industry. So, our current addressable market is 12 per cent and even with such limited and restricted presence, we are still holding one-third of the market share. Overall, if we look at the Indian market, it’s very small, about 4-5 per cent of the industry, but if we look at the global market, this segment is 40-50 per cent. Overall, as the Indian industry matures, people will upgrade to smartphones and then OnePlus will also become more significant as a smartphone brand.
What would be the significance of OnePlus’ collaboration with ‘Star Wars’? What was the idea behind it?
We have completed our third anniversary in India and we wanted to do something special for OnePlus fans in India. The association with ‘Star Wars’ is a part of that effort.
The idea goes back to around eight months, when we activated a social media post group, which worked much better for us. That highlighted the engagement that we have around the Star Wars community. Then we realised that we have a huge overlap of the OnePlus community with the Star Wars community in India. That triggered the idea of merging the two communities and to do something for our users.
Who are your strongest competitors? How do you intend to maintain your competitive advantage?
We do not treat other brands in the market as our competition. If a customer looking to buy a smartphone is keen on buying another brand’s phone, they are open to that option also. But most of them are aware of OnePlus and they also recommend others to buy OnePlus. The reason is that most people who buy OnePlus are highly rational people. They are looking at making the right decision and getting the right value for the money that they are spending. Those who do not buy from us are looking for some other value proposition like brand preference. This has been justified for many markets, but the Indian market has traditionally been a very value conscious market and not very type conscious.
Based on our experience, the Indian market really likes our product, the common point being that they get the value for the product we offer. This is typically true for the entry level users. Users also spend more money on the latest versions of our phones because of the product value. Corporate users are more concerned about the brand association as they do their work while on the move. That’s why they are the most satisfied group of our customers. Nine of every 10 corporate users have been upgrading their older OnePlus devices with the latest OnePlus device. So, this is a strong loyalty that we receive from the OnePlus Community.
OnePlus has been promoted as the perfect phone for students, primarily the younger population. How would you describe the actual TG for OnePlus?
There are different ways to look at the target audience. Firstly, we are available only online. People buying our phones are primarily e-commerce shoppers, who are traditionally mostly youngsters and located in Tier 1 cities and the top 5-10 cities. Secondly, talking about their psychology and consumer behaviour, OnePlus users are also tech savvy and know exactly which product they want to buy. They are also rational buyers. They justify the price and do not get influenced by the heavily advertised products. The mobile industry is probably one of the most heavily advertised industries, which has a probability of users getting more exposure to different brand communications.
We have come up in such a short span of time in a tough product scenario. The onus goes to our users, who do not believe in getting influenced by the constant clutter in the market. That’s why we get such a strong response from our community. We have the highest ratings (around 4.4 and more) for our products on Amazon, which is the highest rating on that platform. All of these users are online shoppers who are happy and satisfied with our products. They are the kind of people we cater to.
How do plan to tap into different markets within India? What about the Tier 2 markets?
Yes, to an extent this could be one of the focus areas for us. But if you see, OnePlus already has 62 per cent of the online market shares. With overall growth, the online industry will also grow. So, we will keep our policy of online presence only. We will be putting in more efforts to increase the online awareness for the people to come online and shop OnePlus devices from there. A lot of the growth will be from the TG who is now unaware of the platform.
One Plus 5T had recently come up with a great TVC – ‘A New View’. What are the new views that One Plus is set to provide its users?
Why we call this ‘A New View’ is because in OnePlus 5T, we have introduced for the first time a full screen display, an immersive display which opens up window for higher experience with the device. The phone can now be used beyond the usual purpose. Our new full screen device is superior to the earlier view provided by the earlier products. There is improved storage as well.
How has OnePlus reframed its digital marketing vis-a-vis advertising? Which is the agency involved?
Most of the marketing related activities have been largely in-house. We are associated with a media agency that helps us in media planning and buying. For this purpose we do not do a lot of advertisement. Another agency supports our social media presence, but largely the activities are based around our OnePlus online community. We are doing other campaigns with the approach of reaching and engaging our digital community.
OnePlus has had its presence digitally. How has the revenue game changed ever since? Any plan to make the phones available offline in retail stores?
If you look at the revenue at an industry level, brands have reduced their prices to increase their market share. It used to be dominated by a few players, but that market has gone already too competitive and aggressive, thus price decrease in India. The other spectrum is the premium brands, including OnePlus, Samsung and Apple, who dominate the market share. Therefore, it is difficult to penetrate this market since the latter players have been in the scene for more than a decade. But our performance speaks well of our place in the market. Having said that, there are some other upcoming players also who have made their presence felt in the market. However, the players from the premium category have not lowered their prices and continue to provide higher user experience and they will continue to push the boundaries.
We are experimenting with different offline concepts, but – as I said – that would be a push-driven strategy, which we do not see as our long term good strategy. We believe in creating awareness and interest in our buyers present online. Amazon is one of the best e-commerce platforms. We believe in providing and improving the OnePlus experience. However, as an experiment, we have opened an offline store in Bangalore. It’s the first offline store for OnePlus anywhere in the world, because we see Bangalore as the most active and open community anywhere in the world. This has worked really well for us. So, we may open such stores in major cities of India like Delhi and Mumbai. That is our one step towards offline presence. We have partnered with Tata Chroma as well for offline presence.
From the price point of view, OnePlus owns a big market share now, breaking the Apple and Samsung duopoly. Will there be efforts made towards price reconsiderations?
No, we are not looking to enter into different price segments and come up with price variants as a long term strategy for us. Price interventions are not really appreciated by the users too. Most brands typically do price revisions and then we see the product still not moving out. Thus, in that way we are very conservative, we try to never have that situation. We are confident of how many pieces we would sell. Since the beginning we have not done any discounting, but improved the quality and that is why we have such a strong user trust. As it is, OnePlus devices are priced very competitively. There is no scope for over-pricing. OnePlus offers the best possible prices you can get for this type of phone. The other strategy to grow revenue is to launch the product in different price points. However, for a smaller company like OnePlus, this is not a sustainable strategy. When the competition is stagnant, customers want nothing but the best. If you want to offer the best, your product has to stand out. So, the company has taken a conscious call of launching only one device a year, which will be at par with any other competitors’ product. This is our way to make sure that we are competing on the best possible product price in the market.
What are the new technologies that OnePlus has been involved with?
As a company, one more thing that we constantly try to achieve is to offer a better user experience. Five years back people used to ask, what is more in this device? What are the various apps? That used to be the differentiator. They used to think that by just adding new features in the app makes it better. What they don’t know is that just adding new features to an app doesn’t make a device better. We try to improve the core user experience such as making the device more capable of charging as fast as possible and preventing it from getting hot due to charging and using. They (customers) should be able to have the best camera experience. These are the factors that make a device better and that’s what we focus on. Core infrastructure is more important to us.
Right now we have improved two features which are going to become one of the most popular features of our phones. It is today the fastest charging device in the mobile phone category and this is one of the key reasons why OnePlus phones are so famous and you can actually watch, talk and read movies without having to worry about the battery. Secondly, we have the reading book feature for users who like to read on their phones. Also, we have a new improved camera. It is another very important part of any smartphone. We have brought in the dual camera, while we have also introduced the portrait mode, which is a very popular feature now. These features make our product superior to most of the products available from our competitors in the market.
One Plus has an exclusive partnership with Amazon. How has that been developing? Will there be more such partnerships?
The partnership with Amazon is very special. We were the first brand that Amazon partnered with. Before us, Flipkart used to offer such exclusive partnerships with mobile brands for sales. But Amazon had that trust in us and vice versa, also because we both share the global DNA, so we both knew that we would go for a long term market. We are really happy that over the years our partnership has evolved. Since 2014, multiple brands have opted multi-platform partnerships and a lot of them have gone for exclusive partnerships. This has developed our relationship with e-commerce platform. So, we have kept only one platform as we do not have to spend our time and energy on looking for better deals on competing platforms. We will continue our association with Amazon as we both have faith and each other’s capabilities.
For more related news visit here.