Chi­nese Chi­nese brands brands win­ning win­ning war war of of the the mo­bile mo­bile phones phones

In­no­va­tive, af­ford­able lo­cal brands make gains over Sam­sung, Ap­ple

China Daily (USA) - - FRONT PAGE - By FAN FEIFEI and MASI in Bei­jing

Zhang Jing, 29, who works at a re­search in­sti­tute in Shen­zhen, has been us­ing a Sam­sung Galaxy Note 3 smart­phone for two years. Its ex­quis­ite de­sign and high-megapixel cam­era made her a big fan of the South Korean tech gi­ant. Zhang had planned to up­grade to a Note 7.

But the love af­fair came to an end af­ter ex­plo­sions of the newly launched Note 7 were re­ported. Sam­sung said ear­lier this month it would re­call about 190,000 Note 7 phones in China to avoid fur­ther bat­tery ex­plo­sions.

“It is a mat­ter of trust. I don’t think I will buy Sam­sung smart­phones any more. Lo­cal brands are good al­ter­na­tives,” she said.

Zhang was not alone. The on­go­ing Note 7 re­call cri­sis is draw­ing more con­sumers away from Sam­sung to lo­cal play­ers, an­a­lysts said, high­light­ing broader prob­lems for­eign smart­phone ven­dors face in China as home­grown brands Huawei and Oppo quickly catch up.

Of 57,000 Chi­nese ne­ti­zens polled by re­search in­sti­tute Pen­guin In­tel­li­gence in Septem­ber, 7.2 per­cent said they planned to buy a Sam­sung smart­phone while 38 per­cent of them chose Huawei as their top choice for the next hand­set.

“We al­ready have no­ticed a fall in the sales of Sam­sung’s full prod­uct lineup, in­clud­ing both its pre­mium hand­sets

and low-to-mid­dle-end de­vices,” said Jin Di, re­search man­ager at In­ter­na­tional Data Corp China.

The South Korean firm, with a mar­ket share of less than 7 per­cent in China in the se­cond quar­ter of this year, is likely to see a fur­ther de­cline in ship­ments, she added.

As Chi­nese smart­phone ven­dors make steady im­prove­ments in hard­ware and soft­ware, for­eign firms are los­ing their shine, said Ni­cole Peng, re­search direc­tor at Shang­hai-based con­sul­tancy Canalys.

Do­mes­tic play­ers ac­count for 85 per­cent of China’s smart­phone mar­ket, and the fig­ure is likely to reach 90 per­cent within a year, she said.

Sam­sung’s for­eign peer Ap­ple, for in­stance, is also wrestling with a drop in sales. Its lat­est model, iPhone 7, failed to in­spire the en­thu- siasm seen among lo­cal con­sumers when ear­lier ver­sions were re­leased.

Over 70 per­cent of the 57,000 Chi­nese con­sumers polled said they would not buy iPhone 7, cit­ing lim­ited im­prove­ments and the high price tag as ma­jor rea­sons.

Wu Wen­jun, who has been sell­ing phones and ac­ces­sories in Bei­jing’s Chaoyang district for two years, said that in the past, con­sumers would come in and grab an iPhone or Sam­sung hand­set without shop­ping around. Now, how­ever, Wu says more want to try out lo­cal mod­els.

“I use the Huawei P9. Pre­vi­ously, I would re­move the ‘Sent from my Huawei’ sig­na­ture at the bot­tom of the email app be­cause Chi­nese brands of­ten were as­so­ci­ated with in­fe­rior de­sign and sys­tems,” Wu said.

“But now, ev­ery­body knows Huawei, and many of them have be­come fans.”

In the se­cond quar­ter, Huawei, Oppo and Vivo were the top three brands in China, with a com­bined share of 47 per­cent of the mar­ket, ac­cord­ing to IDC.

Sam­sung barely reg­is­tered in mar­ket rank­ings in China in that quar­ter, and Ap­ple was fifth. That marks a dras­tic change from sev­eral years ago, when the two firms dom­i­nated the world’s largest smart­phone mar­ket.

Though Ap­ple and Sam­sung still have a big pres­ence in the above-3,000 yuan ($445) hand­set mar­ket, lo­cal play­ers are erod­ing their share, said James Yan, re­search direc­tor at Coun­ter­point Tech­nol­ogy Mar­ket Re­search.

“It is Chi­nese ven­dors, not for­eign firms, that are ac­tively ex­per­i­ment­ing with new tech­nolo­gies that res­onate with lo­cal con­sumers, such as wire­less charg­ing, big­ger stor­age and phones that sup­port mul­ti­ple car­ri­ers,” he said.

Ap­ple, for in­stance, did not of­fer dual cam­eras un­til the iPhone 7 Plus, which was un­veiled last month, about half a year later than Huawei’s P9, which comes with Le­ica dual lenses.

In smaller cities, Oppo and Vivo have seen big sales jumps af­ter hir­ing celebrity en­dorsers and cre­at­ing a large net­work of brick-and-mor­tar part­ner stores to sell their phones.

“Since the Chi­nese smart­phone mar­ket is reach­ing sat­u­ra­tion and is driven chiefly by re­place­ment users, con­sumers in third-tier to fifth-tier cities also are de­mand­ing high-qual­ity hand­sets, and most of them have cho­sen lo­cal brands,” said Peng from Canalys.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.