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A Chinese smartphone brand is winning over high-spending Indians

A little-known Chinese brand is beating Apple and Samsung in the battle for some big-spending Indian smartphone custo...

Posted: Jun 7, 2018 9:25 AM
Updated: Jun 7, 2018 9:25 AM

A little-known Chinese brand is beating Apple and Samsung in the battle for some big-spending Indian smartphone customers.

OnePlus, which was founded four years ago, accounted for 53% of India's high-end smartphone market last quarter, according to research firm IDC. It defines high-end as phones that cost between $400 and $600.

"OnePlus has been very aggressive" in India, said IDC analyst Kiranjeet Kaur.

It's the latest Chinese company to challenge the established global smartphone players in India. Xiaomi, a big Chinese startup, overtook Samsung to become the country's number one smartphone seller last year.

OnePlus, which began manufacturing phones in India last year, is targeting a small but potentially lucrative slice of the market with high-specification devices that are cheaper than Apple and Samsung's flagship products.

Related: India poised for smartphone revolution

It has drawn attention in other countries, including the United States, by selling directly to customers online, relying mostly on word of mouth to drive sales. But in India, OnePlus set up physical stores and pop-up kiosks in malls to drive offline sales, and participated in cashback offers from banks to make its phones more affordable, Kaur said.

The efforts paid off, and now the Chinese company wants to keep the momentum going with its latest phone, the OnePlus 6, which went on sale late last month.

Commercials for the new device feature a "Top Gun"-esque tag line "The Speed You Need." That's a nod to Indian consumers tendency to pick high-end phones based on how fast they run, according to Rushabh Doshi, an analyst with market research firm Canalys.

Canalys data shows OnePlus in a three-way race for India's premium market.

"They are trying to give specifications that are higher than Samsung or Apple, or that Samsung or Apple have never offered before, at lower rates," Doshi said.

The OnePlus 6 costs 35,000 rupees ($520), just over a third of the price of Apple's iPhone X in the country -- and more than 20% cheaper than Samsung's Galaxy S8.

OnePlus was set up by former employees of Oppo, one of the biggest smartphone makers in China. Oppo is a major investor in OnePlus, and the two companies share technology and manufacturing resources.

Related: How China's Xiaomi took India's smartphone market by storm

OnePlus' biggest markets are China, the United States and India, according to IDC. The company didn't respond to a request for comment for this article.

Its success at the higher end of India's market doesn't make it a big player overall.

Demand for smartphones is exploding in the country, but researchers say the vast majority of consumers -- between 85% and 90% -- buy phones that cost less than $200.

OnePlus' share of India's overall smartphone market was less than 1% last year, according to IDC.

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