Chinese fingerprint on smartphone trends in Malaysia, Singapore: Page 2 of 2
By Karamjit Singh April 6, 2015
Samsung will fight back in 2015
It is not Apple’s continued strength that poses a challenge to smartphone market leader Samsung, which held on to its lead in both Malaysia and Singapore in 2014.
In Malaysia, Samsung’s market share hovered around the 45% mark over 2012-2013, but fell to 30% in 2014. It was a very similar situation in Singapore, where its share fell from 49% in 2013 to 28% in 2014.
Despite Samsung’s strong marketing and branding efforts in both Malaysia and Singapore over the years, the rapid adoption by consumers of Chinese brands is showing that consumers place a premium not in brand image, but rather in the value they receive from the phone’s performance from the price they pay.
The Chinese vendor that made a significant impact in the Singapore market is Xiaomi, which jumped to the No 3 position just one quarter after launch, and commanded a 16% market share over the course of 2014.
Will Samsung fight back this year? And leveraging on the scale it has, how aggressive will it get in pricing? Will it defend its turf across all price points, or focus on the lower- to high-end tier, giving up on the mid-tier?
With IDC predicting lower 2015 prices for smartphones in the lower-end market – between RM350 and RM400 in Malaysia and around RM500 and RM550 in Singapore, it will be a bruising fight for market share with razor margins – not that consumers will complain.
Life left in local player Ninetology?
While there are no local brands of note in Singapore, one local player which threw its hat into the Malaysian smartphone ring in 2013 and 2014 was Ninetology Marketing Sdn Bhd.
But despite having a low price point and strong channel presence, it too got caught in the storm of Chinese players entering the market with not just strong phones but mainly online channel strategies.
The online marketing strategies negated the previously held belief that a strong physical channel presence was critical to market share.
By IDC accounts, Ninetology suffered a bad year in 2014. And while IDC feels that it could make a comeback in 2015, “we would lean more towards the pessimistic side because unlike in Indonesia and the Philippines, where local brands appeared first, Ninetology is coming into a market that is already flooded with low-cost, high-quality Chinese brands,” says Ooi.
“But if it is able to leverage its channels successfully, and keep prices down, it might be able to enjoy some success in the ultra-low-end segment,” he adds.
Despite the odds, with nearly 10 million units of smart devices shipped into Malaysia in 2014 – and with smartphones outnumbering tablets by a ratio of nearly four to one – Ninetology may find a market segment, especially the sub-US$100 market that it can target.
Looks like 2015 will be another interesting year for the ultra-competitive smartphone markets in Malaysia and Singapore, with the main question being over who will lose out the most to the Chinese vendors.
Six of world’s top 10 smartphone vendors are Chinese brands: TrendForce
SEA smartphone sales exceed US$16.4bil in past 12mths: GfK
Smartphone shipments up 25% in Q3 2014, Apple-Samsung at risk
Pressure mounts on Samsung as competitors up ante
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