OPPO becomes no. 1 smartphone brand in China

Beijing, March 5 : OPPO has risen through the ranks to become the number one smartphone brand in China for the first time in January 2021, a new report said on Friday.

According to Counterpoint Researchs Market Pulse Service, OPPOs market share reached 21 per cent in January followed by Vivo 20 per cent and Huawei, Apple and Xiaomi at 16 per cent.

OPPOs sales grew 33 per cent month-on-month (MoM) and 26 per cent year-on-year (YoY) during the month."OPPO has been successfully able to reposition its product lines in 2020.

The rebranding of the Reno series and launching a more capable device at a lower price point than its predecessor helped OPPO capture the affordable premium segment," Varun Mishra, Senior Analyst at Counterpoint Research, said in a statement.Huawei along with HONOR has been constantly losing its share in the Chinese market due to component shortages following US sanctions, and fewer new launches.

Its inventory for key components has been depleting and it will not be able to source 5G smartphone components.Over 65 per cent of devices sold in China in Q4 2020 were 5G capable.

Any absence of 5G models reduces the addressable market size for Huawei in China while the absence of Google services does the same for 4G devices.To make the most of its depleting inventory of components, Huawei has shifted its focus more towards the premium segment, only selling products with higher margins.

This has further left a gap in the mid-segment of the market.Due to insufficient supplies, the distributors in China are also scaling down their Huawei operations and shifting to other brands.

As per the report, OPPOs growth was in part also driven by Huaweis decline, a trend that also benefitted Xiaomi and vivo.Xiaomi is benefiting the most from the decline in Huaweis online share, while OPPO and vivo have been capturing the offline segment.

At its peak, Huawei had more than 10,000 retail and experience stores across China.This number has been decreasing since Q4 2020.

Huawei has also spun off HONOR as a separate brand.With HONOR now being considered as a separate brand, it further reduces Huaweis market share in China.

Huaweis declining trend will continue in 2021, with other OEMs gaining share from the gap created by its decline.