As the big hitters of the global smartphone industry slug it out at the World Mobile Congress in Barcelona this week, less well-known brands are vying for a toehold in the lucrative Arabian Gulf market.
But with shelf space among the big retailers dominated by Samsung, Apple and other global names, new arrivals can find it difficult.
Brands such as Oppo and i.onik are eyeing growth at opposite ends of the market.
Tablets and smartphones by i.onik sell for Dh60 to Dh1,000, with an aggressive business plan targeting 1 million unit sales across the range in its first year in the region. It even has a 72-hour, guaranteed, money back policy if you don’t like the product.
“The 72-hour return policy is a nice gimmick, but I’m not sure it will make retailers or customers flock to the brand,” said Jehas Habison, purchasing manager for Costless Electronics.
Targeting the top section of the market is the high-end Oppo R5 – the thinnest smartphone in the world. It retails at Dh1,899.
Oppo launched globally in 2011 and entered the Middle East market last October. The company declined to disclose its sales performance so far or its projections, but its product is available in 14 outlets across the UAE.
The smartphone market in the UAE is dominated by Samsung, with a 33 per cent share. Apple with 17 per cent and Lenovo with 13 per cent round out the top three.
“Forty per cent of all smartphones shipped to the GCC in the fourth quarter of 2014 fell into the US$450-plus price category,” said Nabila Popal, a research manager for the tech analysts IDC. “While building a great flagship device is obviously key, how vendors then market their devices and approach the distribution channel will ultimately decide how much of that cake they get to eat.”
I.onik was bought by Dubai-based Global Distribution Group in January last year. Its five smartphone models run on the Android system and will be joined by two lower-end phones and six tablets. The tablets will sell from Dh199.
"We expect to sell 1 million units in the first year," said V M Chandrasekar, group general manager for Global Distribution Group. "We know we are in a very competitive field, but we are targeting those that are not in the market for Samsung or Apple. We already have 10 per cent of the market in Germany, Switzerland and Austria so we know we have a significant product. We have launched in the Americas, India, Africa, the Far East and Asia."
Local retailers were coy about the likelihood of stocking the new brand. Selling lower-priced products cuts into store profit margins, dilutes sales and takes up valuable shelf space from better- known brands.
“For the UAE, the biggest challenge is to get into the retail spaces and they are all full,” said Mr Habison. “I think i.onik is really targeting Iraq, Iran and Afghanistan etc. If the brand has genuine quality at a reasonable price, then it will do well there.”
ascott@thenational.ae
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