Asus is exiting Rs 10,000 price segment in Indian smartphone market

Asustek Computers, the Taiwanese company that sells handsets under the Asus brand, is changing its strategy for the highly competitive smartphone market in India by narrowing its focus on Rs 10,000- Rs 30,000 price category, and exiting the sub Rs 10,000 space to better compete with aggressive Chinese companies like Xiaomi, Oppo and Vivo, a senior executive said.
“We do see that the competition in the market is actually very tough with the agrresive approach by Chinese competitors in the last few months. We see that they are very aggressive with resources they have. They are much bigger. If we don’t focus then we lose to them…so far we are able to sustain, but then we decided to change our strategy and be more focused,” Peter Chang, Regional Director, South Asia and Country Manager India, ASUS, told ET. “Based on the focused strategy, we will have better chance to fight with the competitors.”
Samsung continues to dominate the top spot with 24 per cent share at the end of June 2017. Interestingly, the other four spots in the top 5 tally are occupied by Chinese players — Xiaomi, vivo, Oppo and Lenovo. China-based vendors, with their massive ongoing marketing, spend and channel expansion, accounted for 54 per cent share of the June-ending quarter’s shipment.
The market share of Indian vendors like Micromax and Lava remained limited to 15% of the overall smartphone market at June-end.
The handset maker isn’t looking at major volume growth this year, but it will look at increasing its share in the Rs 10,000 and above category with the launch of its new ZenFone 4 Selfie Series. ” Our selfie range is the main segment in terms of pricing we want to focus. In the past, we had some products that were priced below Rs 9,000. Now, we are largely focusing on Rs 10,000 -Rs 30,000 price category,” Chang said.
The company, which currently has 10 running models in India, will launch a fewer number of models, in line with its new strategy.
Asus is currently selling 1.5 lakh units per month on an average, which it expects to sustain by the end of this year. Smartphone currently contributes 60% revenue towards the overall turnover, while rest comes from the PC business, which the executive said is growing.
The company has launched its new phone series in partnership with ecommerce major Flipkart, and now expects online sales contribution to increase from the current 35% of the overall sales. Chang, however, said that the company will have a balanced approach with a focus on both online and offline channels.
Flipkart will offer exchange and assured Buyback Guarantee across all the three variants from the ZenFone 4 Selfie series.
Asus is also looking to collaborate with mobile Internet startups and app developers to integrate third-party services with its operating platform and app store to deepen its presence in the country. “Previous few months, there were a few companies that we have discussed with the headquarters around localisation and optimisation. This is currently at the discussion level,” Chang said.
“That is a continuous process. We will see if any company in India can help us. Our R&D team is in touch with Asus India team, which can help connect them with local companies. We will introduce those companies to our headquarter and then see how they can do the development,” he further added.