Chinese smartphone Each brand enjoys growing success in the South African smartphone market, gaining market share and outpacing the growth of the leading players, even at low levels.
South Africa's smartphone market saw unit sales growth of just 0.1% in the final quarter of 2023, said Mohamed Rehman, smartphone market analyst for South Africa at market research firm GFK. However, Chinese brands “significantly outperformed the market with 56.8% growth.”
Rehman said this multi-segment growth of Chinese branded mobile phones represents a strategic shift in the approach these companies take to the local market.
The company initially focused on tapping into the lower segment, which was neglected by more established brands like Apple and Samsung, but now it has products ranging from entry level all the way to the top of the premium segment. , offers competitive products.
Customer purchasing patterns also suggest that the appeal of these brands goes beyond price competitiveness.
According to GfK data, Chinese smartphone brands achieved a 25% growth in the prepaid market and an impressive 77% growth rate in postpaid sales in the fourth quarter of 2023. Postpaid segments generally have more money to spend than prepaid.
“Other factors that make these brands more attractive include additional accessories in the box, increased aesthetic appeal, and better technical features compared to the price. We are meeting the rapidly growing demand for 5G technology with a variety of products,” said Rehman.
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Six major Chinese mobile phone brands sell devices in South Africa: Huawei, Honor, Oppo, Vivo, Xiaomi and Tecno. Huawei was a top contender for Chinese brands at home and abroad, but it got caught up in the trade war between the US and China, was kicked out of the Google Play app ecosystem, and lost significant market share.
However, one of the rising stars of Chinese mobile phone brands, Honor, was born in 2013 as a sub-brand of Huawei. Honor started shipping its smartphones internationally in 2014, first to Malaysia and then to Europe and the Americas. The company currently has a presence in 74 markets worldwide, including South Africa. Honor's flagship device is the Magic V2, which is marketed as the world's thinnest foldable and retails for R39,999.
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Oppo, on the other hand, has a much longer history, dating back to 2004. The first device that Oppo launched internationally in 2005 was an MP3 player called Oppo X3. Since then, the company has expanded its range to more than 50. Countries including the United States. The highest spec device that Oppo sells in South Africa is the Reno 10+ Pro, which retails for R2,1999.
Headquartered in Dongguan, Guangdong Province, China, Vivo was founded in 2009. Vivo's product range spans smartphones, smartwatches, earphones, power banks, and speakers. According to Vivo's website, the highest spec Vivo device available in South Africa is the newly launched His V30 5G, but pricing information is not yet available.
Xiaomi was founded in 2010 and now makes wearables and smart home devices in addition to smartphones. The company is doing particularly well in the Indian market, often topping the sales list.
While these Chinese brands have diversified their products to cater to the higher end of the smartphone market, Tecno has consistently targeted the lower end of the market. Tecno's parent company, Transsion Holdings, specializes in emerging markets and has a strong presence in Africa, the Middle East, Southeast Asia and Latin America. The Tecno Spark 10 Pro is the company's most expensive device, retailing for just R4,999.
Despite Tecno's focus on the more affordable market, other Chinese brands are choosing to compete at all price points. Although GfK does not elaborate on market penetration rates, StatCounter data suggests that the high growth rates of Chinese brands are also influenced by low base effects (see chart above) ).
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“Chinese brands are no longer competing only in entry-level affordable devices, but also in mid- to high-priced market segments. These are effectively disrupting the traditional premium brand lineup,” GfK says Lehmann. – © 2024 News Central Media