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  • Writer's pictureAjay Sharma

Twenty Two Days For Twenty Twenty!

As 2019 draws to a close, all eyes will be on what 2020 will offer!

To recap, 2019 was a year:

1. With the least growth since 2016. From 14% in 2017-18 to a 7-9% this year. (As per IDC)

2. When the BBK group moved full steam ahead with the “New kid on the block#Realme coming up as a challenger brand.

3. When #Samsung saw it's market share declining and coming sub 20% for the first time.

4. That witnessed an increased share of online with the offline reacting to it sharply. With brands and channels now talking about launching a product at the same price, in both channels at the same time.

5. That saw the rise of the organised channel as per the predictions I’d made in my previous blog.

6. Where Q3 saw the 2nd, 3rd, and the 4th brand within striking range of each other. Who will break free and close in on the No. 1 position is yet to be seen.

7. When Jio smart feature phone share went down, and 2G phone sales picked-up giving some breathing space to the Indian brands.

8. Where except #Samsung, all brands in the top 5 showed a loss in FY 2018-19. Barring Realme, the other 3 brands have been in the business for close to five years now.

9. When the contribution of “Others” went down from 20.5% in Q1 to 12.7% in Q3. It looks big, but comparing Q2 and Q3, it is just a 1.2% drop.

Honestly, for me, this state of few brands controlling the market is scary. To think of it, just two Chinese groups between BBK (#Oppo, #Vivo, Realme, and #OnePlus) and #Xiaomi have occupied more than 70% of the Indian smartphone market. #Nokia, #Blackberry and #Motorola are examples of great brands that fell on the wayside. And, the fact that the same can happen to any other brand, should not be overlooked. About time for new brands with disruptive technology or way of selling to enter.

The scenarios for 2020:

1. The market growth for smartphones is expected to be higher in 2020 vis a vis 2019.

2. Introduction of 5G phones in the higher-mid and premium segments. Brands in India would use it to position themselves, though, the roll-out of 5G services in India may not happen. Realme apparently has already announced that it will only launch 5G phones in China from 2020. So has Xiaomi, for all its phones priced above USD 285. And, so has #Apple, Nokia, Oppo. Vivo etc. Of course, some of these 5G capable phones will find their way to India.

3. The increasing launches of folding phones. Hopefully, this will put some pressure on the prices helping this category to drive growth.

4. Online share reducing if the “same product at the same price, same time” gets executed without any dilution. Reasons:

a. Online not getting the extra advantage they have in all three parameters of product, timing, and pricing.

b. Lesser buying by offline from online.

5. With brands like Apple, OnePlus or the “Dark Horses” going in for an increase, the contribution of others may go up which will lead to the cannibalisation of shares amongst existing brands. A bloodbath in the offering?

6. The effect Jio’s entry will have on both channels with its O2O model. Do read my blog

7. Last, but not the least, how prepared and unprepared are the brands.


While I don’t foresee an immediate threat to Xiaomi losing its numero-uno position in the near future, they need to be careful as their share has also seen a decline in 2019. From 30+% in Q1 to 27% in Q3. While everyone talks about the Samsung decline, no one talks about the Xiaomi decline.

Xiaomi has moved smartly on paper in terms of reducing their dependence by developing exclusive channels. They know that the non-exclusive network can change their brand preferences very quickly and, realise that the winner in the long term will be the brand that has control over the channel. They have therefore been working on developing an exclusive network in terms of opening Mi Stores and Mi Homes beyond the growth in the non-exclusive network of Mi Preferred Partners.

For online, they have their own portal has a 10% share of the online market for smartphones and note – It is exclusively for Xiaomi phones. They will try and hold on to this share, and even increase, if possible.

However, they need to be careful about the growing dissent of the distributors and the partners.

They also need to build their imagery beyond budget phones with the ASPs in Indian market going up and the growth shifting to the mid-tier price segment. It is here that they will have severe competition from Realme which will also target this segment and whose products are perceived as better quality coming from the house of Oppo.


The brand is majorly offline though it has tasted some success online as well. My previous blog the challenges for the brand, and what I strongly recommend they do to resolve the decline. If they drop to the 3rd or 4th position in end Q4 or early 2020, there is no reason why they cannot drop to No.5..

Being majorly an offline brand, “Same product, same price, same time” will help them more than online-first brands like Xiaomi and Realme.


The brand is going strong, gaining quarter-on-quarter and that too steadily which is important. That the mid-tier is the fastest growing price segment and Vivo leads there, will help them further. They have a strong scope in the online space as well and they can be a strong contender to move up the ladder.

Another good sign is the substantial reduction in losses over the last year. At this rate, they should be a profitable brand next year which is good news for all concerned as one can expect more investments in R&D and marketing.

Again, being majorly an offline brand “same product, same price, same time” will help them more than online-first brands.


The brand is growing very fast with added acceptance in the offline channel cannibalising primarily Samsung. They are also gaining online with some cannibalisation of Xiaomi.

The % growth one sees until now is on a small base and is not sustainable as volumes grow. When a new brand gets launched and grows too fast, it has its side effects in terms of maintaining the % growth leading to a lot of pressure on the sales teams and ultimately the channel. That coupled with the desire to pull-off another Xiaomi can break the best leaders/teams and the channel. They need to be a bit more realistic in terms of their planning for 2020 and aim for steady and organic growth with a strong foundation.

They have the potential to get to the No.2 or No.3 position.

They also need to move away from the concept of distributors handling huge geographies which encourages wholesaling, to a model of city or area within city distribution. They have to also move up the price ladder or the brand gets associated as a price warrior brand only and finds it difficult to move up the price ladder later.


The brand will grow this year, but have cut down on their expenses such as sponsorship of the Indian cricket team will take a hit on visibility.

I am also worried that between Oppo and Realme, while the losses may have declined, the extent is far below what Vivo has been able to achieve in terms of reduction in losses.

I am also confused about where the brand stands with a Realme on one side, and Vivo on the other. It seems like a case of identity loss for me. To stop the cannibalisation the only thing that makes sense for Oppo, which does talk a lot about R&D, is to transition to the premium segment with the Reno Series. Realme stays focussed on aggressive price/specification and fashion-centric phones.

The positioning which limits their play across price segments and the sandwiched position may keep them at No.5 position in 2020 as well.


A major part of their sales this year (approx. 60%) came from models of the previous year, at aggressive prices. They have a product range to cover lower and new price points with a volume from earlier models and margin from the latest business model.

This is the right strategy for India. Coupled with the news of their new launch of 2020 being a game-changer, they could go back to the previous heights achieved by them.

If they do launch the lower-priced SE2 in the first quarter of 2020 with a price tag of under Rs. 30k it could only get better for them. As per some websites, they have already asked their supply chain to stock up the product from December.

It seems Apple is now ready for the price game.

They should also be in the top 8.


The brand is already established in its segment. In 2020, they will show good growth over the current year with their efforts offline.

However, they will face a challenge the other BBK companies like Vivo, Oppo, and Realme which are trying to move up the price segment on one side and Apple doing a good job of pushing down the prices of their old models and the launch of SE2 if it happens. Samsung is there in any case and if there is a segment where they still have a strong presence this is it!

One should expect them to grow and be in the top 8.


Add Nokia which is working hard and Transsion to the list, and the top 10 are fixed.

Dark Horses

1. #Huawei/#Honor approaching the market with their new channel strategies. The major challenge they have is access to the Google eco-system because of the US ban.

2. Will the new slim retro #MotoRAZR do the trick for Motorola with the folding phones catching up in 2020? This will possibly be the best shot Moto can take to get back into the race.

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