Chinese smartphone market declines 3% in Q2
New research from Canalys estimates the Chinese smartphone market has hit decline for the first time in six quarters, but its only bad news for the challenger brands.
It should come as no surprise the world’s largest smartphone market is an important one for most handset manufacturers, but those looking to crack it now are entering at a pretty bad time. These are the brands which will be facing the toughest conditions as Chinese consumers are becoming more drawn to the established brands. It would appear the age of experimentation with new gadgets is coming to a close.
“China’s smartphone market continues to consolidate. The top five brands accounted for almost three quarters of shipments, with the top four all growing and adding 10% to their cumulative share compared with the same quarter a year ago,” said Hattie He of Canalys.
“Adopting a diverse channel strategy is key to success in China, as competition has intensified in online and offline channels, resulting in many vendors losing market share quickly. Huawei and Xiaomi have strong online brands, and are now rapidly growing their offline channels.
“Oppo and Vivo face greater pressure on their mid-range from Redmi and Honor. The failure to establish online channels will slow the momentum of these rising stars.”
Overall, the firm estimates smartphone shipments fell 3% to 113 million in Q2 2017, with Huawei hitting top spot at 23 million units, taking the lead for the second consecutive quarter. Oppo grew at 37% to 21 million, while Vivo shipped 16 million to claim third spot.
While the international vendors will not be happy losing share in the Chinese market, perhaps a wary eye should also be cast to the future. There is a track record of Chinese firms going big in the domestic market, establishing a solid cash cow, before assaulting the rest of the world. Huawei (and to a lesser degree, ZTE) is a prime example, while there is some evidence of Alibaba heading a similar direction with its cloud business.
