Business hasn’t been great for Samsung in China lately. According to a report from Counterpoint, the company’s smartphone sales decreased by around 60 percent in the first quarter of the year. The tech giant sold 3.5 million smartphones and grabbed only 3.3 percent of the market, down from 8.6 percent a year ago.
Samsung is having a hard time competing against Chinese companies including Huawei, Oppo, and Vivo, which increased their sales by 25 percent, 81 percent, and 60 percent. Huawei was the biggest player in China in the first three months of the year with a market share of 19.7 percent. Oppo took the number two spot with a 17.5 percent market share, followed by Vivo with 17.1 percent.
According to industry watchers, the top three companies were able to increase sales by offering affordable prices, convenient distribution channels, and localized app services. Samsung’s smartphones, on the other hand, are a lot more expensive, are only available at offline retail stores, and lack localized app services.
Samsung’s future in China doesn’t look too bright at the moment. The company has to find a way to spark consumer interest if it wants to stay relevant in the world’s largest smartphone market.
Chinese consumers are more price sensitive than those living in Western countries, so Samsung might need to consider more aggressive pricing strategies. Online sales, where most mainstream Chinese consumers buy their phones, would also help Samsung compete on an even keel. Otherwise, it won’t be able to challenge Huawei, Vivo, and other manufacturers that are offering smartphones with a better price-performance ratio through more convenient channels.
The South Korean giant actually has the same problem in India as well. It’s losing the battle against low-cost Chinese brands including Lenovo, OnePlus, Gionee, and Xiaomi.