why-are-chinese-android-phones-so-cheap

Why are Chinese Android phones so cheap?

China's Android phones offer high-quality specs at a very affordable price. How do you know this? These are some facts about cheap Chinese smartphones. Apple and Samsung are the two most popular names when you think about buying a new smartphone. These tech giants have been rivals for years and are known for their ability to drive tech innovation through their cutting-edge products. As new Chinese brands enter tech, the competition is fiercer than ever. This comes as new opportunities, challenges, and concerns arise—the truth behind China's sudden rise in brand popularity and why you should be concerned.

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The BBK Electronics Empire

You've probably heard of at most one brand from Oppo or Vivo. These new brands are subsidiaries of the Dongguan-based Chinese firm BBK Electronics, founded by Duan Yongping.

Depending on your location, you may not have heard of BBK before or be familiar with it. This multinational conglomerate was the largest smartphone manufacturer in the world in Q1 2021, surpassing even the most famous tech companies.

The History of BBK Electronics – Parent Company of OPPO, OnePlus & Vivo Electronics, Source: Youtube, Follow This Trending World

Although BBK is not a household name worldwide, its subsidiary brands are making a mark in the tech industry. These sub-brands are becoming independent full-fledged companies so fast that they have become global brands.

Realme, for example, is an Oppo sub-brand. Qian is also a Vivo sub-brand and is currently on the same path towards independence. Although they may appear distant from one another, the subsidiaries companies communicate and collaborate closely, sharing ideas, expertise, and strategies.

Chinese Phone Makers: The Genius

You can see the genius behind the Chinese phone manufacturers when you zoom in. It is easy to avoid losses if more subsidiary brands are on the market. Because another can take a brand's hit, the other brands can absorb it and disperse the effect.

This is probably the most crucial reason for BBK's colossal success. It is easier to view BBK's subsidiary brands as one entity than treat them as distinct entities. This is how the giant is changing the tech industry. Let's look at Q1 2021 global smartphone market share statistics.

The market share of all three BBK subsidiaries (Oppo Vivo and Realme) is impressive at 25%. This puts them in league with giants such as Apple at 17% and Samsung at 22%, respectively. We must not forget to include OnePlus' market share in this equation. BBK remains the largest smartphone manufacturer in the world.

The Story Behind The Biggest Phone Manufacturer You Don't Know About (BBK Electronics), Source: Youtube, TechFlash

 

You've probably noticed that Xiaomi and BBK have the same strategy for market penetration: Divide and conquer. This is also true for Xiaomi's brands, such as Redmi, POCO, Redmi, and partly-owned Black Shark. All of these are designed to serve a particular audience.

Oppo's and Vivo's brands are positioned as innovative brands in the BBK case. The ones that invest in R&D are the ones who come up with new technologies. OnePlus offers a premium smartphone experience at affordable prices. Realme is priced as a budget-friendly brand that will appeal to price-conscious buyers.

How Chinese brands compete with tech giants

You may have noticed that almost all Chinese brands aim to achieve a specific goal: to sell large quantities of value-for-money products to price-conscious customers to establish authority.

This goal has three main elements:

  • The Audience
  • The Strategy
  • The Message

The Audience

Today's buyer is educated, as we all know. They have the tools and knowledge to get the best out of their money. This is evident in highly competitive Asian markets, which are high-demand and highly flexible.

Hyper-elastic demand refers to a slight change in the product's price that significantly affects the product's need. When they enter new markets, Chinese brands profit from this phenomenon by cutting their prices to crush the local competition.

How big are China's tech giants? Time to learn more about Baidu, Alibaba, Tencent, and Xiaomi, Source: Youtube, South China Morning Post 

The Strategy

Brands have the advantage of playing to the numbers in Asia, which has a large population, mainly from China and India. If the devices sell well, they can afford to sell them at a lower profit margin.

Redmi and Realme are budget-oriented brands that don't focus on hardware profit. Instead, they make a profit on their in-built ads and pre-installed Bloatware apps.

The logical approach to achieving that goal is to get phones into as many hands as possible using celebrity endorsements and sponsorships at events. They also opt for the second-mover advantage to avoid investing in R&D that could fail.

The Message

The best thing about having multiple subsidiary brands is the ability to market and create a unique brand image. Let's look at OnePlus as an example. It was a brand that positioned itself as an enthusiast brand, with catchy slogans like "Never Settle" or "Flagship Killer" when it started.

It listened to customers and adjusted its products to reflect their needs. All this while providing a premium smartphone experience at affordable prices.

OnePlus now makes flagship devices seven years after its inception--as ironic and bizarre as it may sound. Chinese brands are more customer-centric and community-focused than other Asian brands, which is an excellent strategy in the fast-paced Asian market.

What Brand Would You Choose to Buy from in China?

Even though Chinese brands are not everyone's first choice, especially if they are from the US, they may be. They are quickly establishing their market in India, a rapidly growing market. They are threatening international brands and have eliminated all local competition.

What Brand Would You Choose to Buy from in China?

What Brand Would You Choose to Buy from in China? Source: Proreviewsapp

These great smartphones are expensive. It's difficult to remove the software ads and bloatware from a Chinese smartphone, particularly a budget model. They eat up memory and make your OS experience less pleasant.

Conclusion

There is also growing concern about Chinese brands spying upon their users. This is a result of the US-China clashes and the Huawei ban in 2022. This is something to consider if you consider buying one of these Chinese brands.

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Hope this article is helpful to you, thanks for reading.

Source: https://proreviewsapp.com/