Oppo Mobiles takes a large bite out of Apple's market share in China
Oppo Mobiles has become the largest smartphone brand in China with a 22.9% market share in June 2016. The company's sales surged on back of the launch of the Xplay 5 and demand for its X6 series, according to a Counterpoint Research report.
The market share of the company in China has increased by over threefold since June 2015 where its market share was just 6.1%. “Oppo became the number one brand in China for the first time ever in June surpassing Huawei, Apple and Xiaomi with a record 23% market share with sales volumes up a massive 337% annually for the month,” said Counterpoint Research, Director, James Yan.
Commenting on Oppo’s skyrocket growth, Research Director Neil Shah, noted, “Oppo has adopted a simple but effective strategy, going after the offline market which still contributes more than 70% of total sales in China. Aggressive marketing, promotions and sponsorships, greater offline retail penetration beyond tier-2 and tier-3 cities, better retail margins, dealer support and above all head-turning, innovative smartphone designs has helped Oppo drive its sales in the last eighteen months.
Even Vivo has displayed strong performance during the month as its market share rose from 7.3% in June last year to 12% in the same month in 2016.
However, Apple's market share in China slipped to 2014 levels as iPhone 6S and SE demand remained lower in comparison to the iPhone 6 series demand seen last year. The market share of the company declined to 9% in June 2016 from 13.2% in the corresponding story last year.
Samsung too took a hit as its market share declined to 6.8% in June 2016 from 9.5% in the same month last year. Xiaomi's market share also declined to 6.8% from 15.1% in the same period last year.
This comes as bad news for Apple especially as its sales has been slipping in one of its largest markets. The company has been trying to get back into the game ever since it posted its first decline in profits in years. However, the iPhone SE, which was expected to be a low cost phone of the company, has failed to boost demand for its phones.
“Chinese brands now control more than 84% of the total Chinese smartphone market as they exert an iron grip on the sales channels, industrial design curve and leverage access to Chinese supply chain. Their dominance extends across the price bands even extending in to the premium segment with models such as Huawei P9, Oppo R9 Plus and Vivo X play 5,” said Shah.