A small Chinese smartphone brand is using its bigger brother’s tricks to beat it on Indian turf.
Realme, which began as an Oppo sub-brand in May 2019, was promptly spun off into a standalone entity. Between June and August 2019, the Shenzhen-based firm posted a phenomenal 600% year-over-year growth in India. In the quarter ended September 2019, the number of its buyers in the subcontinent grew by a whopping 400% from a year ago, recent data from International Data Corporation (IDC) show.
Though Realme only accounts for 3% of the total smartphone market in the country, compared to Xiaomi’s 27%, its strategy apes the market leader’s closely, experts say.
“Realme’s success is a perfect story of a new brand trying to take on a giant (Read Xiaomi) at its own game,” Navkendar Singh, a Gurugram-based research director with IDC India, told Quartz.
Unlike other Chinese players like Vivo and Oppo, which are very offline-focused with investments in channel marketing and offline distribution, Realme focused on online from the start. “Realme began as a direct competitor to Xiaomi in all respects, majorly via online, similar price points and segments of Rs7,000 to Rs20,000 ($98 to $280)—which is where Xiaomi dominates and has been immensely successful in giving latest specifications at very affordable price points,” Singh noted.
The online game
Like Xiaomi, Realme sold phones solely through an online channel for a year to cut overheads.
Beijing-based Xiaomi led in the online channel with a market share of 40% in the third quarter (July-September period) of financial year 2019, with four out of the five top models sold being from Xiaomi, IDC data show. While Realme is still small fish, it’s performing exceedingly well. The vendor’s online share stood at an all-time high of 26.5% during this period, a significant jump from 16.5% in the previous quarter.
This trend will likely continue as internet and smartphone adoption thrives and as e-commerce continues to evolve in India, experts say.
“The growth and maturity of online channels from serving more zip codes than ever, coupled with greater customer service, attractive promotions from discounts to cashback to EMI, and exchange offers will be pivotal in driving smartphone sales during this festive season and also taking a large share from the offline channels,” said Anshika Jain, research analyst of Counterpoint Research.
Funnily enough, the avenue for growth—the internet—is also a battleground for the two brands. The top bosses at Xiaomi and Realme have even exchanged words about their rivalry. In April this year, Xiaomi’s Manu Jain tweeted that the Realme 3 Pro featured an older processor than the one used in Xiaomi’s Redmi Note 7 Pro. Madhav Sheth, CEO of Realme India, hit back at Xiaomi for being “afraid.”
Recently a brand has started talking about Qualcomm SD 710.
Here's the thruth: it's a one year old processor! We launched a phone with SD 710 (globally) in Q2 2018.
— #MiFan Manu Kumar Jain (@manukumarjain) April 15, 2019
Someone is afraid of #Speedawakens?
It's gonna be true for them on 22nd April anyways.
RT and welcome the speed if you're not afraid but really excited.