Stay Competitive in the Slowing Smartphone Market
Smartphone manufacturers should not boost their sales and maintain their growth momentum through price wars, says Simon Lee in an interview with Bloomberg Businessweek/Chinese. Instead, he says they should entice users to upgrade their devices through technological breakthroughs.
After six years of strong growth, the golden age of worldwide smartphone growth ground to a halt in 2015. The industry expects to see a noticeable slowdown in shipments in 2016 as China joins North America and Western Europe in entering a more mature growth phase. The number of shipments to the world’s biggest smartphone market, China, has neared saturation. It is imperative for smartphone vendors like Xiaomi, Apple and Samsung to identify the next growth engine.
The China smartphone market contracted by 4 percent year-over-year with 98.8 million units shipped in the first quarter of 2015 after six years of growth, according to International Data Corporation (IDC)’s Mobile Phone Tracker released last May. The report reveals that the smartphone market has become increasingly saturated in China. Thus, convincing existing and potential users to upgrade to new smartphones would be the key to further growth in the China market.
Commenting on the global smartphone market, Simon Lee, Assistant Dean (Undergraduate Studies) and Senior Lecturer of School of Accountancy at The Chinese University of Hong Kong Business School, told Bloomberg Businessweek/Chinese in an exclusive interview that slower growth is expected to intensify as the smartphone market has reached saturation.
“Smartphone manufacturers should not boost their sales and maintain their growth momentum through price wars as this is not sustainable,” Lee comments. “The manufacturers should instead develop breakthroughs in software and hardware for their devices to satisfy the demands of customers.”
“Product differentiation among different smartphone brands in terms of features has become increasingly blurred. Smartphone manufacturers just focus on enlarging the screen size and enhancing the power of built-in cameras, which can no longer wow users and entice them to upgrade their mobile devices,” Lee adds.
Lee cites an example saying that “smartphone users need to bring along a portable power bank so that they can charge their mobile devices while on the go. This is absolutely inconvenient. If any manufacturer could identify a major breakthrough in boosting battery life, it would be the next winner in the smartphone market.”
Please click on the images below for more details of the original story written in Chinese.
Source: Bloomberg Businessweek/Chinese
Date published: 24 February, 2016
Photo: TrueTech