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As South Korean electronics giant LG exits the smartphone business and Huawei’s market share continues to decline due to the US crackdown, the Russian smartphone market has seen the rearrangement of market players this year. , with a group of Chinese brands including Xiaomi, OPPO and Vivo eyeing larger market share.

Xiaomi took the first place in the Russian smartphone market for the first time in the second quarter of 2021, with a market share of 32.8%, while the former market leader Samsung saw its share drop to 28.3% , according to International Data Corporation (IDC) in August.

Chinese group BBK brands, including realme, together held 8.9% of the market, while Huawei escaped the top five, IDC data revealed.

Counterpoint Research analyst Soumen Mandal noted in a June report that he expects stiff competition between realme and Honor.

Meanwhile, Shenzhen-based Transsion Holdings, which quickly became a dominant player in the African mobile phone market, has expanded to other markets including Turkey, Thailand and Russia. TECNO and the brand’s Infinix launched a large-screen gaming smartphone in Russia this fall, according to media reports.

Russia’s recovery from a second wave of COVID-19 infections, analysts said, as well as the negative impact of US sanctions on Huawei’s smartphone business and LG’s exit from its loss-making smartphone business have benefited consumers. Chinese phone manufacturers.

Russia’s GDP growth rate reached 10.5% year-on-year in the second quarter – its strongest growth since 2000, as the economy rebounds from a sharp contraction due to the pandemic, Rosstat data showed , the Federal Department of Statistics of Russia.

“Russian consumers now focus mainly on low and mid-range devices, and as a result, the high prices of Chinese technology companies through large-scale production make their smartphones popular in Russia,” Sun Yanbiao, director of the company Shenzhen-based N1mobile research firm told the Global Times on Monday, noting that LG’s suppliers exit opportunity for emerging brands.

In April, the South Korean tech giant announced it was shutting down its mobile business unit by the end of July. The slowdown came after the company was squeezed out of the high-end market by Samsung and Apple and Chinese brands including OPPO and Transsion Holdings, reducing its global market share to just around 2% in 2020.

The challenges persist

While gaining a foothold in the international market through technological prowess and competitive pricing, Chinese smartphone brands face challenges regarding sales channels and supply chains.

An anonymous smartphone marketing representative for a Chinese brand, which recently shifted its focus from India to Eastern Europe, told the Global Times on Tuesday that an appropriate pricing and channel strategy suited to Local markets had proven to be more important than mere physical differentiation in gaining customers. .

“Unlike importing basic components for final assembly in markets with high tariff barriers like India and Pakistan, we have not set up a factory in Eastern Europe. difficult for foreign smartphone brands to enter the market, ”he said.

After years of activity in foreign markets, OPPO and Vivo have gained distribution margins by establishing extensive sales and service networks, chuhaipost.com reported, citing a mobile phone agent in Russia. “Despite the challenge of setting prices correctly when entering a market, these brands are able to bring a successful experience in mature markets within one or two years to the new market through exclusive agents and stores. offline in order to maintain universal pricing, ”he added. the insider said.

While Xiaomi competes with its competitors by leveraging its advantages in product value and volume, it is also becoming more channel-friendly as it expands in overseas markets. For Xiaomi, which is focused on light assets and brand, distribution agencies may think that the supply chain cannot be guaranteed, while the competition between them is chaotic due to the lack of a universal pricing mechanism, according to the report.

Troubled by the prolonged pandemic and the limited supply of crucial components such as chips, Chinese smartphone brands have been forced to rethink their regional strategies and focus their efforts on a more promising market, Sun said, referring to the decision of some Chinese brands to de-prioritize shipments to the Indian market while moving to markets such as Europe and Africa.

In the second quarter of last year, the total market share of Chinese smartphone brands in India fell sharply from an all-time high of 81% to 72%, mainly due to the closure of factories and the disruption in sales due to the COVID-19 pandemic and associated lockdowns, followed by heightened anti-Chinese sentiment in the country, according to the Counterpoint Research report.

“Although the Indian market is quite large, it is not lucrative due to the low consumption capacity, which is exacerbated by rampant COVID-19 epidemics. The pandemic has caused us to change our strategy abroad and to make more efforts in Europe and Southeast Asia, “said the marketing staff, noting that other opportunities arise for Chinese brands abroad.


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