China smartphone makers face challenges

The smartphone industry has seen significant shift in market shares, particularly among the Chinese brands.

Globally, Samsung has kept the top spot and Apple is still the runner up. But Xiaomi, which was earlier in the No. 3 position, has slipped, as did some other Chinese brands such as Letv and Coolpad

Meanwhile, three other mainland makers — Huawei, OPPO and Vivo — moved up to occupy the third, fourth and fifth spots

Global handset shipments rose by a meager 0.3 percent to 343 million units in the second quarter of this year, according to IDC data. Developing countries such as India and Africa are still witnessing growth but markets in the West have shown a notable contraction.
Samsung remains the top smartphone vendor worldwide, thanks to its diversified smartphone offerings that cover the entire range of mid to high-end segments.
The company’s smartphone shipments increased by 5.5 percent in the second quarter to 77 million over the same period a year earlier, helping the Korean giant take 22.4 percent of global market share

As for Apple, it recorded a 15 percent decline in second-quarter shipments to 40.40 million units, taking a hit due to the absence of new launches

In the mean time, three Chinese brands posted robust growth

Huawei took over the third spot with 32.1 million units sold, up 8.4 percent from the year before. It was followed closely by fellow Chinese manufacturers OPPO and Vivo, at 22.6 million and 16.4 million units, respectively

OPPO and Vivo registered whopping year-on-year growth of 136.6 percent and 80.2 percent respectively in second-quarter shipments.

Meanwhile, Xiaomi and once-popular brands like LeTV and Coolpad lagged behind.
Singling out the China market, Xiaomi’s shipments slid by 38.4 percent and its market share fell under 10 percent. By contrast, Huawei, OPPO and vivo recorded shipment gains of 15.2 percent, 124.1 percent and 74.7 percent respectively.

Xiaomi had been very successful with its low-price strategy, but that was until other low-end makers from China, India and Russia copied the same cut-throat pricing approach.

The outlook for Xiaomi is worrisome now given that it has been counting on selling smartphones on the cheap to gain a big customer base and monetize it through the cross-selling of other products such as software, games and home appliances, a business model that does not seem to work at all.

On one hand, the company is challenged by numerous makers that won’t hesitate to undercut Xiaomi for market share. On the other, the goal of achieving huge sales of other products appears very difficult

Xiamoi has been burning cash raised over the past few years. Given the current tough market situation, the company may not find it easy to convince investors to put in more money. 

Now, what about the three rising Chinese players? Are they doing a lot better? 

Well, not exactly. 

Huawei, OPPO and Vivo have done a good job in cost control. To expand market share, they even supply smartphones to telecom carriers under the carriers’ own labels. 

But the sharp gains in sales may come at the expense of profit margin. At the end of the day, their businesses may not be that profitable. 


Source: EJ Insight

Wearable and Interactive Technology Star at Consumer Electronics Show

Also, self-driving shuttles, solar cars, and 3D-printed food were among many other products shown at the 2014 International Consumer Electronic Show in Las Vegas, Nevada.

CEA Projects Increase in 2014 Consumer Electronics Accessories Sales

Total sales of consumer electronics (CE) accessories, excluding batteries and blank media, will continue to rise in 2014, according to new research from the Consumer Electronics Association (CEA)^®. The report, CE Accessories at Retail, projects a slight increase of $13 million in this category, buoyed by the popularity of tablet and smartphone accessories, headphones and ear buds, raising 2014’s CE accessories sales projection to $8.5 billion.

According to the research, 59 percent of online consumers surveyed purchased CE accessories in the last year. The most popular items purchased by online consumers were ear buds (42 percent), wireless phone chargers (41 percent), wireless phone cases (32 percent) and wireless mice (30 percent). These items, along with extra memory cards for digital imaging devices and over-the-ear headphones, are consumers’ most commonly planned accessory purchases for the year ahead, as well.

The CEA research also gauged consumers’ buying behavior, reporting that the majority of online consumers surveyed (66 percent) say physical stores are the main channel they use to shop for, learn about and purchase accessories, citing convenience as their primary motivation. Those consumers who choose to buy accessories online say this option offers the best prices, convenience and enables easier browsing and comparison shopping. Only a small percentage of consumers, however, use mobile devices to shop for accessories (seven percent) or actually buy items (two percent).

Consumers surveyed say quality is the most important factor when choosing CE accessories, while need and brand name also influence their decisions. Among the other findings of the CE Accessories at Retail research:

• Seventy-seven percent of online consumers say they plan ahead for their accessory purchases, rather than make impulse buys (23 percent);

• Consumers who do make unplanned purchases say store displays (27 percent) have the biggest influence on their buying behavior;

• Fifty percent of consumers buy an accessory at the same time they purchase the CE device for which it is intended;

• Accessories with the highest attachment rates include those for video game devices (72 percent), wireless phones (66 percent), and computing devices (61 percent);

• While purchase motivation varies by the type of CE device with which an accessory will be used, the most common reason is to replace a broken accessory (26 percent);

• About half of consumers (48 percent) are interested in personalizing their accessories through color (67 percent) and design options (62 percent). 

Additionally, about half of consumers are interested in saving money by purchasing either packages containing all accessories (52 percent) for a particular device or some other type of bundled package (42 percent). Just 19 percent, however, prefer to purchase accessories individually. 

Click image to view full infographic.

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