The sector of smartphone has witnessed significant changes and transformations in recent years. An impressive number of brands have decided to abandon the market, leading to a drastic reduction in the number of active brands. Counterpoint Research he analysed delved into the causes of this decline and offered in-depth insight into the trends and future prospects of the smartphone market.
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Decline of local smartphone brands
The decline in the number of active companies worldwide is mainly attributed to brand local. These, once defined as "local kings", for example Micromax in India and Symphony in Bangladesh, have lost significant market share or completely abandoned the market in the last five years.
These brands operated predominantly in lower price points and in regions with fragmented markets, such as Asia-Pacific, Latin America and the Middle East & Africa, making it difficult to maintain a stable and competitive presence. Although we don't know these small companies in our market, globally they have taken one significant market share. Micromax, for example, has always been strong in India given its very low cost devices.
Challenges in research and marketing efforts for brands
In a dynamic and rapidly evolving industry like smartphones, smaller and less established brands have coped difficulties in an attempt to compete with large, established brands in terms of research and development and marketing efforts. Continuous technological innovation and evolving consumer needs have made it essential for brands to maintain a constant pace of development and renewal to remain relevant and competitive in the market.
On the other hand, small brands, with limited resources and a narrower market presence, have often found it difficult to compete at this level. Many had to rely on white-label devices, i.e. generic products produced by third parties and resold under their own brand. This strategy has limited their ability to differentiate and innovate, making difficult for them to establish a brand identity unique and stand out in a saturated market.
Evolution of customer needs
Consumer needs have changed and matured over time. Now, consumers are demanding best specifications, innovative designs, strong brand value and effective ecosystem integration. The rise of Chinese smartphone brands such as Xiaomi, OPPO and vivo has accelerated the decline of small brands, offering superior quality products at competitive prices, meeting growing consumer expectations.
So if on the one hand it is true that initially the small brands were lucky, on the other hand they were not able to keep pace with innovation. This innovation is dictated by the needs of customers and their requests, but also by the firepower of the other giants
Industry adversity on smartphone brands
The smartphone industry has faced a series of unprecedented adversities and challenges in recent years, which have had significant impacts on brands of all sizes. The pandemic of COVID-19, in particular, has led to disruptions in supply chains, delays of production and logistical difficulties, affecting product availability and brands' ability to meet consumer demand.
In parallel, the global shortage of electronic components (here an in-depth analysis) has further exacerbated these problems, limiting the availability of key components such as chips and semiconductors and increasing manufacturing costs. This shortage has had a direct impact on smartphone brands' ability to produce devices in sufficient quantities and maintain competitive prices, negatively affecting both their competitiveness and their profitability.
Through | Nearly 500 brands including Microsoft Lumia, BlackBerry, LG have left the smartphone market
