The smartphone sales in Indonesia jumped 13 percent in the first three months this year, from the same period last year, with aggressive marketing from Chinese cheap device manufacturers shacking up market leader Samsung and putting local brands on the back-burner. (ID Photo/David Gita Roza)

Domestic Smartphone Sales Jump 13% as Chinese Brands Expand Market Share

BY :JAKARTA GLOBE

JULY 06, 2017

Jakarta. Smartphone sales in Indonesia jumped 13 percent in the first quarter, compared to the same period last year, with aggressive advertising from Chinese cheap device manufacturers shacking up market leader Samsung and putting local brands on the back burner.

Around 7.3 million smartphones were sold in the country from January to March, a report by information technology research firm International Data Corporation showed on Wednesday (05/07).

The market share of Chinese brands such as Xiaomi and OPPO has jumped to 31 percent, from 23 percent last year.

Global brands, including South Korean Samsung, saw their share dropping to 47 percent from 51 percent.

Local brands such as Polytron, Advan and Evercoss appeared to be struggling, with their market share shrinking to 17 percent from 20 percent a year ago.

Other smaller brands held the remaining 5 percent of the market.

The top five best-selling brands were Samsung, OPPO, Asus from Taiwan, local brand Advan, and Lenovo with its subsidiary Motorola, IDC data showed.

According to Risky Febrian, an associate market analyst at IDC Indonesia, the smartphone market in Indonesia has now changed with China-based vendors becoming more aggressive in catering to the middle and lower income market segment, especially through advertising on billboards, brochures, TV commercials and other media.

The Chinese are also known for giving hefty incentives to local distributors to help them with the market reach.

As a result, China-based vendors now dominate the segment of the market with smartphones priced $200-$400.

"China-based companies' initiative has left local vendors struggling to compete in the market space with limited resources. Meanwhile, Samsung also adopts the competitor's strategy to maintain its market leadership," Risky said in a statement on Wednesday.

Lack of capital now pushed local vendors to compete in the low-end segment, offering smartphones worth less than $200, Risky said.

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