Tuesday, 26 September 2017

Huawei needs a hero despite overtaking Apple in smartphone stakes

By Mary Lennighan, Total Telecom
Wednesday 06 September 17

Research firm advises Chinese vendor to put 'more muscle behind fewer products'

Industry watchers were abuzz on Wednesday with the news that Huawei has overtaken Apple to become the world's second largest smartphone maker, but with a new iPhone set to be unveiled in a matter of days, the Chinese vendor's glory could be short lived. Huawei took a slightly larger market share in global smartphone sales than Apple in July, according to market research firm Counterpoint…

Industry watchers were abuzz on Wednesday with the news that Huawei has overtaken Apple to become the world's second largest smartphone maker, but with a new iPhone set to be unveiled in a matter of days, the Chinese vendor's glory could be short lived.

Huawei took a slightly larger market share in global smartphone sales than Apple in July, according to market research firm Counterpoint, which shared a chart to demonstrate the shape of the market, but no actual figures. The pair look to have around 12% of the market, still some way behind Samsung.

Huawei also outsold Apple in June by a bigger margin, the U.S. company's market share dipping well below the 10% line.

Counterpoint also noted that Huawei has turned in strong sales in August and could stay ahead of its U.S. rival for the third month in a row.

However, the remainder of the year could tell a different story.

"While this streak could be temporary considering the annual iPhone refresh is just around the corner, it nevertheless underscores the rate at which Huawei has been growing," said research director Peter Richardson.

Apple announced late last week that it will launch the iPhone 8 on 12 September.

According to Counterpoint's ranking, the iPhone 7 was the top selling smartphone model in July with a 4% share of the market, followed by the iPhone 7 Plus with 2.9%.

Third and fourth places went to two Oppo devices, the R11 and A57 respectively, and Samsung's Galaxy S8.

No Huawei device appears in the top 10.

Mr Naiya, added. “While Huawei climbed to be the world’s second largest brand overall, it is surprising to see none of its models breaking into the top ten rankings.

"This is due to a multiple SKU (stock-keeping unit) portfolio that currently lacks a true hero device," said senior analyst Pavel Naiya.

"While having a diverse portfolio allows Huawei to fight on multiple fronts, it does little to build overall brand recognition; something Huawei badly needs if it is continue to gain share," Naiya said. "While Huawei has trimmed its portfolio, it likely needs to further streamline its product range like Oppo and Xiaomi have done – putting more muscle behind fewer products."

The Chinese firm has some work to do to improve its position in certain key geographies.

"Huawei is over-dependent on its home market China where it enjoys the leadership position and operator-centric markets in Europe, Latin America and [the] Middle East," Richardson said.

"A weak presence in the South Asian, Indian and North American markets limits Huawei's potential in the near-to mid-term to take a sustainable second place position behind Samsung," he warned.
 

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