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Challenging for Global Smartphone Value Share

by David Kerr | Aug 19, 2021

Strategy Analytics has published an update of "VALUE SHARE: Global Smartphone Revenue, ASP and Profit by Vendor by Price Tier: Q2 2021." Clients can access the full excel report.

Apple remains the dominant force in terms of share of global wholesale revenues with a 40%+ share in Q2 2021.

After a monster Q4 2020 and the much needed innovation stimulus of 5G, Apple as usual sees its shipments and share of smartphone wholesale revenues decline in Q1 and Q2.

The battle behind Android #1 Samsung looks set to become more interesting as vivo, Oppo, Xiaomi, Realme and others compete for the share previously held by Huawei. 



As recently as Q2 2020, Huawei was on track to post 20% share of global smartphone wholesale revenue before the impact of the US inspired ban on components and Google Mobile Services really kicked in.

Huawei had passed Samsung in share of global smartphone wholesale revenues but without access to 5G chips outside China and a uncertain future, operators and end users became anxious and were forced to turn to other brands. Huawei share of smartphone value globally tumbled to only 2% in Q2 2021. 

Xiaomi, Oppo and Vivo are currently best positioned to challenge Samsung in terms of value share but Realme and Honor are definitely worth keeping an eye on. All of the Chinese vendors are looking to find a balance of volume and value in their portfolio to maximize profitability.  The huge volumes in the maturing China market has seen vendors look to differentiate between online and offline focused product experiences. Additionally, Chinese vendors have all sought to boost revenue and profits by moving up the price curve and capturing share in premium tiers.

Chinese brands have also incubated and brought to market sub-brands to help penetrate under performing segments and position higher performance families separately from budget devices. An open question is how successful Chinese brands can be in international markets in the premium tiers and whether their China strategy can be successfully replicated around the world.

Samsung still has a strong grip as the leader in Android smartphone value share with an ASP globally that remains higher than its challengers. Most importantly, Samsung has  captured more than 30% in $900-$999 price tier for example. Huawei had been the strongest challenger in devices targeting the premium device buying Tecno segment of the market.  Samsung has benefitted most from the lack of premium competition in Android so far but how quickly and successfully can Vivo, OnePlus, Realme, Xiaomi, Honor, and Oppo gain value share? 

Samsung does have a significant lead in technology innovation both in reality and in terms of consumer perceptions relative to the challenger brands.

Samsung is far ahead and the undisputed leader in foldables and new form factors despite early prototype/concept model promotion by others. Samsung dominates the foldables market and has 3 generations of product now under its belt.

Outside of China where a transition has begun, vendors have a) low overall awareness/familiarity and  b) limited consumer product experience either in smartphones or consumer electronics or household appliances.

Some key questions which SA can assist with via our custom consulting projects include:

Can Xiaomi break the 10% value share globally for full year 2021? What does the top 5/10 vendor revenue share look like in 2022? 2023? 

What does the value share /share of revenue leaderboard look like by region? by country?

What price tiers are growing the fastest and which are most open to new brands?

What does replacement behavior look like by Price Tier given that only 2 of the 5 smartphone buyer segments prioritize technology?

How will the sports focused sponsorship efforts of Vivo (Euro2020) and Oppo (Wimbledon) change awareness and consideration of the brands in CEE, W. Europe, Latam?


 
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