OnePlus Shows Apple How to Become India’s Top Smartphone Seller

oneplus shows apple how to become indias top smartphone seller
A 1+ logo sits on the case of a OnePlus One smartphone in this arranged photograph at the Mobile World Congress in Barcelona, Spain, on Monday, March 2, 2015. Photographer: Simon Dawson/Bloomberg

India is arguably the world’s toughest smartphone market — just ask Apple . Yet Chinese manufacturer OnePlus has found a path to success in the country of 1.3 billion.

As Pete Lau, OnePlus’s co-founder and chief executive officer, describes it, OnePlus targeted younger users with stylish and affordable Android-based phones. Rather than plastering shops with ads, student ambassadors promote the Shenzhen-based company’s products. OnePlus also sponsors cricket games, breaking a no-advertising pledge it has in other places.

Thanks to those efforts, OnePlus commanded 40 percent of India’s premium smartphone market in June, compared with zero when it arrived in 2014, according to Counterpoint Research, which defines the segment as one where devices cost 30,000 rupees ($435) or more. OnePlus is ahead of Samsung Electronics Co., which has a 34 percent share, and Apple Inc.’s 14 percent. Long term, Lau is betting that he’ll be able to outrun rivals at the top end of the world’s fastest-growing smartphone market.

More from Bloomberg.com: Musk Mulls Taking Tesla Private, Valuing Company at $82 Billion

“The premium smartphone segment may be small, but buying power among young Indians is surging and will create a huge opportunity by 2020,” Lau, 43, said in an interview. “We have a standard product across the globe, we don’t do a sub-$100 category for India. Lower-tier products require compromises that we are unwilling to make.”

To be sure, OnePlus isn’t even in the top five when it comes to India’s broader smartphone market, which includes phones that cost less than 30,000 rupees. Samsung is No. 1 by shipments, followed by Xiaomi, Vivo, Oppo and Huawei, according to Counterpoint .

More from Bloomberg.com: Manafort Judge to Prosecutor: ‘There’s Tears in Your Eyes’

OnePlus usually introduces a single new smartphone model every year using premium chips, screens and materials. Based on simple designs without flashy colors and features, the phones usually cause a buzz on Android forums when they debut. The phones are sold in North America, Europe, China and other parts of Asia.

India, the world’s second-largest smartphone market, will have almost 500 million users by 2022, compared with 337 million this year, according to eMarketer. Success has been elusive for Apple, which forced out three top sales executives in June as it seeks to overhaul its operations in the country. While the Cupertino, California-based company offers zero-interest payment plans and cash-back incentives, its products are beyond the reach of most shoppers.

More from Bloomberg.com: Turkey’s Cratering Markets Stoke Speculation Over Extreme Measures

PhoneStarting prices
(rupees)
Price in dollars 
OnePlus 528,000$406
OnePlus 635,000$510
iPhone 868,000$990
iPhone X 95,000$1,380

“OnePlus’s strategy of packing the best specs into their phones and offering the most competitive price seems to have helped,” said Rushabh Doshi, a research manager at Canalys. “Its pricing strategy has appealed to the cost-conscious and flagship-aspiring consumers in India who want to own the ‘best’ smartphone in the market but at a competitive cost.”

Lau doesn’t speak any of India’s 22 official languages, not even English, but language hasn’t been a barrier. He wants to expand OnePlus’s retail presence beyond a single store in downtown Bangalore, open a research facility and even make the city a second headquarters after China. Almost a third of OnePlus’s $1.4 billion in revenue came from India last year.

“We try not to be overly distracted by what’s going on in the market or our competition,” said Lau, who started as a hardware engineer at China’s Oppo, another smartphone maker that’s pushing aggressively into India. Another rival, Xiaomi, recently held an initial public offering as it seeks to expand abroad. Asked whether OnePlus was ready to do the same, Lau said, “We don’t need funds and I’m not looking to retire — I have at least 30 years ahead of me.”

More from Bloomberg.com

Read OnePlus Shows Apple How to Become India’s Top Smartphone Seller on bloomberg.com

Read on The Source

Author: HEDGE

Hedge Accordingly was founded ahead of the global financial crisis in January of 2008, with the goal of providing our readers our unique take on The Latest News on Wall Street, Stocks, #Politics and Business news. Hedge Accordingly produces both original, and aggregated #Wallst news content from top publishers around the world. We curate aggregated content covering the latest news on politics, stocks, wall street, and the tech industry. We also provide free stock charting, quotes and a bitcoin, forex and currency exchange. Learn More About HEDGEaccordingly.com