Why Chinese Brands are ruling Indian Mobile Market? PART 1
Welcome to Fresh New Episode of The Insider Story. Today we’ll see why Chinese brands are ruling the Indian Mobile Market. It will be a roller coaster ride that’s why presented it to you in 2 parts. Let’s start part 1 : Chinese brands in India!
Xiaomi: India’s New Samsung
Xiaomi, the name majority of people are holding in their hands. Xiaomi has successfully destroyed Samsung in the Indian smartphone market in the last couple of years. Making xiaomi India’s #1 Smartphone Company.
“Indians like budget smartphones a lot.” That’s it. Xiaomi rise began in India. Manufacturing low-cost budget handset, by providing newer technologies & processors at cheap rates than any other OEM in the market.
How did xiaomi do it?
5% Profit Policy
The Chinese smartphone manufacturer and Internet company, Xiaomi limits its net profit margin to 5% only. This includes all xiaomi’s hardware business like Redmi smartphones, IOT devices & lifestyle products like Mi Band 2.
This allows xiaomi to put more focus on their products which means they prefer quality over quantity, unlike iPhone Prices. Xiaomi is aiming for large volumes of customers with a low-profit-margin which combined results in good revenue. Xiaomi specifically targets low & middle-class users which combined are nearly 80% of the Indian population. Heres what xiaomi CEO said about their profit margin.
“If we sell our products at close to cost and return value to our users, then we can earn the long-term support of our users. Aiming for large volumes with small profit margins will still result in suitable hardware profits for us in the long term.” says, Xiaomi’s Chairman and CEO, Lei Jun
MIUI is one of the most popular Android skin in the world says, Android Central
Although many xiaomi users also the critiize manufacturer of not using ‘Android Stock’ which is, in fact, the best pure Android experience. Xiaomi uses MIUI specific because it helps them in the following ways:
– To integrate their software services & apps within MIUI which is not possible in Stock skin.
– To cut Cost. Yes, Android Stock comes with Google Bundle apps & at a price which may increase the cost of the phone itself.
– For more customization.
– More recently, Xiaomi started displaying Ads to MIUI skin users to increase their revenue.
BBK Electronics (Oppo, Vivo, and one plus)
Do you know? Oppo, Vivo & one plus are all under one brand named BBK electronics but under different segments.
- Oppo: Low & Mid Range Segments
- VIVO: Low & Mid Range Segments
- One Plus: Mid Range & Flagship Segments.
One Plus Brand have nearly destroyed Apple iPhone sells in India. iPhone sales in India fell nearly 50% year-on-year last year says, Quartz India.
Here’s an interesting story I found on Quora about VIVO & Oppo strategy.
By Devdatt N Pai (Tech Enthusiast)
I went to Kochi last day to visit my grandmother
As I walked, I noticed a really busy street with a lot of mobile phone shops.
Two shops, which were selling Oppo and Vivo Phones, some blocks apart, were ‘competing’ to sell Phones. The Vivo phone shop started playing really cool music. The Oppo shop started playing cooler music. Advertisers were ‘competing’ to deliver pamphlets.
Hearing this cool and cooler music, I suddenly felt a sense of competition. I wanted to buy a Vivo phone. It was so cool.
I later came to know that the two shops were owned by the same set of people . Their strategy is to create a false sense of competition!
There was a viral WhatsApp joke that said if you don’t see VIVO or Oppo Banners nearby then you’re not in INDIA. Vivo & Oppo both have similar marketing & advertisement strategy.
– VIVO spend a lot in cricket & entertainment sector in 2017. In fact, VIVO sponsored IPL in 2016 and 2017 which is one of the most watched & highly anticipated tournaments not only in India but worldwide.
– VIVO has paid Rs 2,199 crore to retain the title rights for IPL till 2022.
– Oppo on the other hand also brought 5-year sponsorship deal of Indian Cricket Team till 2022.
Why Chinese Brands are ruling Indian Mobile Market? PART 2
Hope you like this post. But, wait the story is not over yet. There are many questions to be answered
- What were Indian smartphone manufacturers doing until Chinese brands overtook the market?
- What happened to Indian smartphone brands like Micromax, Lava or Karbonn?
- Why Samsung lose its #1 rank against xiaomi?
- The Future War Samsung M Series vs Xiaomi Note 7 Pro.
This all will be covered under sequel post (ESP6) of The Insider Story which will be released on 16 FEB 2019 only on PinProgram.com stay tuned.