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Oppo,Vivo Smartphone Journey In India - Bound to Lose Market Share In FY18

Chinese Smartphone players dashed in Indian Smartphone sector post slowdown in China. Cash rich Smartphone companies like Vivo, Oppo, Gionee, Oneplus, Meizu, LeEco and many more went for different strategy to grab market share.The approach taken by Chinese smartphone player is similar to e-commerce players in India. Companies like Oppo and Vivo went for carpet advertisement model along whereas LeEco and Gionee went for different approach.

We have seen first casualty, when LeEco went for drastic downsizing of their business in India post overspending in advertisement and subsidising their devices to get more customer. As per counterpoint research, Chinese Smartphone players are controlling 50% Smartphone market but I differ on the assessment. Assessment should be based on the sustainability and believe that many Chinese players will close their shutters in FY18 or will downsizing their business in India.

Oppo and Vivo went ahead in 2016 and bought maximum slots across advertising medium. They are overspending on channel in order to sell their device. Unfortunately, they missed to learn the lesson from others. The moment they will reduce the channel transfer or advertisement then sales is going to go down drastically.

I am not aware about their financial but can say that they are burning money to buyout customer. When it comes to Oppo and Vivo, repeat customer ratio will be the lowest.Counterpoint also pointed out that Micromax, Lava and Karbonn market share came down to 20% collectively but missed to highlight excellent  strategy of home grown Indian Smartphone player. We are not seeing Indian brand advertisement the way they used to go for. They understand that Indian Smartphone sector will be down for next one more quarter and conserving cash. Most of my prediction came true and can bet that the above assessment based on reverse Eagle eye way will come true. Will appreciate comments.
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About Devendra Prasad

20 years plus industry veteran of domestic and international ICT domain with the expertise in Business, Technology, Strategy and Analysis. Specializes in forecasting impact analysis, trends and recommendations for Investments, Technology and Regulations.
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  1. Oppo/Vivo phones have few good qualities (1) they look very good (2) they have better camera than competition. Wont this sustain there sales? also their BOM is low and they make more margins which they plough back into marketing of distribution/retail incentives.

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