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Can HUAWEI overtake Samsung and become the largest smartphone maker in the world?
HUAWEI has been the third-largest smartphone maker in the world for quite some time, sitting below Apple and Samsung. According to a market analysis by Counterpoint Research, this has recently changed, as the company actually passed Apple in June, July, and likely in August in terms of sales. Exact sales numbers weren’t shared with the public, but the graph below does show that HUAWEI’s lead is minimal at this point.
While Apple’s new iPhones are expected to significantly increase the company’s sales, HUAWEI will likely be bumped down to the third position again in a short period of time. However, that doesn’t change the fact that the company is not only planning on soon passing Apple for good, it also wants to overtake Samsung eventually.
HUAWEI wants to become the biggest smartphone maker in the world
That’s right, HUAWEI wants to become the biggest smartphone maker in the world. The manufacturer has been very open about its bold plans with the public, saying that it wants to surpass Samsung within the next four years, by 2021.
So what exactly does HUAWEI have to do to have any chance of becoming the biggest smartphone manufacturer in the world?
Stand out from the crowd
The Galaxy S8 has the Infinity Display, the new Note 8 has the S Pen, the OnePlus 5 has Dash Charge, while HUAWEI’s flagships have, well, nothing really.
HUAWEI has a number of great smartphones in its lineup, but none of them really stand out from the crowd. One of the first things HUAWEI has to do is to come up with a few unique features that will allow it to differentiate its devices from the competition. The Galaxy S8 has the Infinity Display, the Note 8 has the S Pen, the OnePlus 5 has Dash Charge, the Moto Z2 Force has the ShatterShield display and Moto Mods, while HUAWEI’s flagships have, well, not a ton that other smartphones don’t have. Sure, there’s the Leica-branded camera setup, but that’s not really a strong enough USP (unique selling proposition) that would convince the masses to get the P10 or Mate 9 over the competition. And despite the fact the cameras in high-end HUAWEI smartphones are good, they aren’t market leading.
The only thing that makes the company’s smartphones stand out from the crowd is the EMUI skin, but unfortunately, not so much in a good way. If HUAWEI wants to boost its chances of reaching the top, it needs to improve its user interface. Although EMUI has gotten better with each new version, it’s still far from the most popular skin out there. It changes the look and feel of Android quite a bit and, in a way, tries to imitate Apple’s iOS, which is something a lot of people aren’t a fan of.
To appeal to the masses, the best move for HUAWEI would be to make EMUI a lot lighter, bringing it closer to stock Android. At the same time, the UI should offer something extra such as a few unique and useful features that would make it different than the competition.
OnePlus has done a great job in this area with its popular and light OxygenOS that offers a bunch of useful customization features that don’t get in the way if you don’t want to use them. Lenovo even took a step further and decided to ditch its Vibe UI altogether and now ships smartphones with a stock version of Android. I don’t think HUAWEI will go down this road, but simplifying its UI is definitely something it should consider in order to make its devices more appealing to users and increase sales in the process.
Expand and simplify
In terms of sales, HUAWEI has been doing great in its home country of China as well as Europe. To get to the next level, however, it has to increase its presence in other major markets around the world starting with the US. HUAWEI has yet to make an impact stateside, which is something it has to change if it wants to overtake Samsung within the next four years. The first thing it has to do is bring its flagship devices to the country with the help of large carriers such as Verizon, AT&T, and others, in order to get them in front of as many consumers as possible.
The company is already working on this, as it has reportedly made a deal with AT&T that will apparently sell the upcoming Mate 10 sometime during the first half of 2018. This is HUAWEI’s first step towards increasing its presence in the US and one that will allow it to directly compete with Samsung and Apple for consumers’ attention. The next step should be to bring its flagship P-series to the US, which will hopefully happen next year. As you may know, despite initial rumors, the P10 and P10 Plus were never officially released in the US. If HUAWEI could get that worked out, then perhaps they could take the next step and start bringing more budget-friendly devices to the US and spend some money on various marketing campaigns that have proven to be quite successful in Europe so far.
The US is a market that could help HUAWEI increase sales of its high-end smartphones. However, to increase sales of its entry-level and mid-range handsets, the company should focus more on one of the largest smartphone markets in the world, India. Demand has been rising quite a bit over the years in India, with low-cost Chinese brands taking center stage thanks to their devices that offer a great price-performance ratio. HUAWEI hasn’t been doing a great job in this large country, which is a problem that needs to be addressed in order to achieve its ambitious goal.
It doesn’t help that HUAWEI’s smartphone lineups are confusing. When it comes to high-end devices, things are as they should be with only a couple of options available. There’s the Mate series that goes head to head with Samsung’s Note devices and other phablets, and the P series offering two smartphones in different sizes that currently compete with the likes of the Galaxy S8, LG G6, and HTC U11.
HUAWEI doesn’t have a well-defined mid-range lineup like Samsung with the Galaxy A series or LG with its new Q6 smartphones.
However, when looking at HUAWEI’s mid-range and entry-level smartphones, things get a bit confusing. There are many options available from different series including Nova, Lite, and others. The main problem is that the company doesn’t have a well-defined mid-range lineup like its competition. Samsung, for example, has the Galaxy A devices, whereas LG and Motorola have the Q6 and G series.
The best course of action for HUAWEI would be to simplify its mid-range as well as entry-level lineups of smartphones and make them stand out from the crowd with the help of a few unique and useful features. The already mentioned Galaxy A series is waterproof, for example, while LG’s Q6 smartphones offer a bezel-less display normally only seen on flagships.
The HONOR brand might be the key to success
Huawei’s more budget-friendly HONOR brand has a number of great smartphones in its lineup including the HONOR 9 and 8 Pro, among others. The great thing about them is that not only do they offer an attractive design, they also have a great price-performance ratio, or at least a better one than HUAWEI-branded devices.
The problem is that not all HONOR smartphones are available in every market where HUAWEI does business. Although the company has been focused a lot on the European market in the last few years, the 8 Pro, for example, is only on sale in a few EU countries for now.
Another problem is that after distributors and retailers apply their sometimes extremely high margins to HONOR’s handsets, they aren’t quite as affordable anymore as one would hope — especially in smaller markets.
So, not only does HUAWEI need to put in more effort to bring HONOR-branded devices to more markets, it also has to keep the prices down as much as possible. The key here could be the expansion of its online store, which would allow the company to avoid third-party retailers and their high markups. Currently, it only ships to some of the largest markets on the old continent and has overlooked the majority of smaller ones. The purchasing power in a lot of these countries isn’t quite as high as in Germany or France, which just might be a great opportunity for HUAWEI to seriously increase overall sales with its affordable HONOR smartphones.
Focusing more on online sales also has the benefit of offering smartphones at lower prices. A lot of companies have been using this strategy in the last years including OnePlus, which quickly rose to fame thanks to its affordable flagships.
The HONOR brand just might be the key to HUAWEI’s success if the company plays its cards right
The HONOR brand just might be the key to HUAWEI’s success, but only if the company plays its cards right. Offering devices with a beautiful design, great specs, and most importantly, an affordable price tag just might significantly increase HUAWEI’s chances to eventually become the largest smartphone maker in the world. This is especially true when considering that a lot of smartphones are getting more expensive with each year — just look at the Galaxy Note 8 with its starting price of $929. But before that happens, it has to bring the devices to more markets, especially via online sales.
Even if HUAWEI manages to do all these things, there’s still no guarantee that it will reach the top. Although I can see it truly beating Apple in the near future, Samsung might be a tougher obstacle to overcome. You see, Samsung has a key ingredient that HUAWEI is missing: a loyal fan base. Just think about it, the Note 7 was a disaster for the company, its acting chief is in jail because of the bribery scandal, and the new Note is one of the most expensive flagships currently available. None of these things seem to bother Samsung fans, based on the great sales numbers of the Note 8. If HUAWEI would have the same problems as Samsung, consumers likely wouldn’t be as forgiving.
Samsung has a key ingredient that HUAWEI is missing, which is a loyal fan base.
Don’t get me wrong, there’s still a chance that HUAWEI can beat Samsung and reach the top, as things on the smartphone market do tend to change quite drastically over time. However, I don’t think HUAWEI has what it takes to pull this off in four short years.
Right now, Samsung is way ahead of its rival in terms of sales and market share. According to IDC, HUAWEI shipped 38.5 million smartphones in the second quarter of this year (11.3 percent market share), while Samsung shipped 79.8 million units (23.3 percent market share). The difference between the two is enormous at this point, so unless Samsung starts doing everything wrong over the next few years and loses its loyal fan base, it will likely still be the smartphone king once 2021 comes along.
And what do you think? Does HUAWEI have what it takes to beat Samsung and become the largest smartphone maker in the world by 2021? Let us know down below.