Samsung is facing bigger threat from Oppo and Vivo than Apple in India

In 2015, Apple, the world’s biggest smartphone maker, had grabbed a cool 13.6% share in China. Playing catch-up were two local labels, Oppo and Vivo, sister brands made by the local Chinese company BBK Electronics; each had a share of 8.2%. Few gave Oppo and Vivo -derided as cheap iPhone knockoffs -a chance to get ahead of Apple. A year later, it was a different story.Both Oppo and Vivo, with shares of 16.8% and 14.8% respectively, toppled Apple in the world’s largest smartphone market. The iPhone maker saw its share dip to 9.6%.

“Apple couldn’t beat us in China because even they have flaws,” Duan Yongping, the reclusive Chinese billionaire who founded Oppo and Vivo, told Bloomberg in March this year.“They made a lot of great things, like their operating system, but we surpass them in other areas.” Oppo and Vivo are now trying to replicate their China success in India by gunning for local leader Samsung. The sister brands, along with their junior sibling OnePlus -all three made by BBK -have together grabbed over 25% of the smartphone market in the first quarter of this year, closing in on leader Samsung, which has a 28% share, according to latest numbers from marketing research firm CyberMedia Research.

“Chinese brands have started to hit Samsung,” says Tarun Pathak, senior analyst (mobile devices and ecosystem) at Counterpoint Research. In spite of having a huge portfolio of products, robust distribution and massive retail reach, Samsung has been losing ground to Chinese upstarts. Oppo launched F3 Plus, a dual-selfie camera handset, last month, after extensive market research by Nielsen.Sky Li, global vice-president of Oppo, says that over 66% of consumers surveyed whined that while taking a selfie they found it difficult to fit everyone in one frame. Oppo realised that a wider angle camera will create the perfect group selfie. This kind of careful research has helped Oppo snatch 9% market share and become the fourth largest smartphone brand in India.

It’s not just the Vivo-Oppo combine that is posing trouble for the South Korean electronics major. There’s another Chinese brand snapping at its heels.Xiaomi is closing in on Samsung as its smartphone shipment to India grows 12% in the first quarter of this year, according to Canalys’ latest market report. While Samsung has maintained its market share with sustained J-series shipments to its established, offline distribution partners, Xiaomi accounted for 14% of shipments in the quarter, up from 3% a year ago. “Xiaomi’s success in India is underscored by its online strategy . Demonetisation seems to have had no impact on it, as its target customer is young, internet-enabled and buys primarily online,” said Canalys research analyst Ishan Dutt in a media release.

Is Samsung feeling the heat?
Asim Warsi, senior vice-president, product planning and marketing team, at Samsung India, is unflustered by the tectonic shift in market shares. “It takes a lot of things to be a market leader, to consolidate your position and be the most trusted brand,” says Warsi. “We don’t believe in the next spec, but the next experience. The next megapixel makes no perceptible difference to the life of consumers.”