Following recent media reports that Chinese telecommunications firm Huawei Technologies has decided to put off its entry level smartphone segment, the company has reiterated that the market segment will always be an important part of its business strategy.
Reports had suggested that the company will now focus on the middle-to-high-end space.
But Yudi Rambaran, the product marketing director for Huawei South Africa, explained that whilst the Company is primarily focused on the mid-to-high-end space, it would continue to service the entry level segment.
“Our focus is indeed on the mid-tier and high end segments. However, for Africa and including South Africa, we will continue to bring some entry level devices to the market based on our market share ambitions and consumer requirements. In addition, we will continue to evaluate our key focus areas and adjust according to market conditions as well as our strategies.”
Huawei’s IDEOS Android smartphone range, launched to the Kenyan and Ugandan market four years ago, strengthened the Company’s entry level smartphone portfolio in Africa. In May 2011 Huawei’s leadership lauded the phone’s performance, claiming at time the IDEOS was the “top selling device”.
Rambaran told ITWeb Africa that the company has maintained the Ascend Y220 android smartphone within the operator channels and will be going into retail at a R599 price point, the Company’s most affordable smartphone offering.
“Based on smartphone sales we’ve had a few of number one smartphone market share months in 2014, specifically around the Y220 and Y22000 models… so from that perspective, we know there is a demand for entry level models,” he said.
Huawei has now brought to market the higher spec Y221 model, which is pitched at a slightly higher margin within the R800-to-R850 price range. However, the company is confident that operators will support the offering, subsidise the solution and help bring the price down closer to the entry price point.
Referring to media reports that the company is distancing itself from the entry level mobile phone segment, Rambaran explained that this notion was more from a global view and Western ideal perspective.
“… the majority of the entry level smartphones do not sell within the Western markets,” said Rambaran. The truth is that it is standard practice within the mobile space to focus on the mid-to-high tier segment because that is where the margins are, he explained. “This is where Huawei’s marketing efforts will be concentrated on.”
At the same time the Company has recognised the strong consumer demand for a recognised brand, entry proposition across South Africa and Africa. To this end Rambaran also confirmed that the Company will be releasing three new entry-level products/ models in 2015.
Huawei’s strategy has always centred on the desire to establish itself as a recognised brand in its own right. The intention is to build on the progress it believes it has made in this regard, to leverage off its evolution from ODM to OEM, and to grow the mid-to-high end segment within Africa, a market the Company describes as “aspirational and key to its growth strategy.”
In November 2014 the company shipped more than three million smartphones in Eastern and Southern Africa.
Larking Huang, general manager at Huawei Consumer South Africa has described 2014 as good for the company’s consumer device business.
He added that in South Africa alone the company has shipped more than a million units, making Huawei the number 2 smartphone provider in the Middle East and Africa region.
Credit: IT Web Africa