While Apple did repeatedly attempt to save its faltering sales in China, the company hasn’t gotten a grip on the same. According to data from a latest IDC report, Apple was pipped by local phone manufacturers Oppo, Huawei and Vivo, thus, causing its shipments to decline by 23.2 percent the past year.
Firstly, bringing things into perspective, the smartphone market in China witnessed a 19 percent growth on a year-on-year basis in 2016. A majority of the said market was hogged by local manufacturers, witnessing saw a 9 percent increase in market share. The Chinese giants in the Top 5 shipments tracker still continue to be the same, alongside Cupertino giant Apple. Other giants like Lenovo, OnePlus or Samsung didn’t even make to the list.
The said tracker report disclosed that Oppo was able to ship more than 78.4 million smartphones, up 122 percent on a year-on-year basis. It managed to only sell 35.3 million smartphones in 2015, but times have since changed. Oppo has emerged as the market leader in China and is facing intense competition from local counterpart Vivo, which grew about 97 percent past year. Huawei has already gained popularity on the international scale (most global sales in the tracker) but managed to show only 22 percent increase in yearly sales last year.
The report further suggests that Oppo and Vivo combined add up to nearly one-third of the shipments in China. Talking about the same, Tay Xiaohan, Senior Market Analyst with IDC Asia/Pacific’s Client Devices team
Increased dependence on mobile apps has led to consumers to seek phone upgrades, thus helping drive the large growth in 2016Q4. In lower-tiered cities, there was a similar demand by consumers, which OPPO and Vivo met by aggressively pushing mid-range smartphones in these cities.
This year was marked by a drop in sales for Apple in most of the quarters, thus, adding up to a massive 23.3 percent yearly decline. It was accompanied by Xiaomi, the popular Chinese phone maker who’s seen impressive sales in India and Southeast Asia. Also, the company recently accepted that it has grown way too fast internationally and now needs to get a grip on its expansion and release schedule. It has recently also lost its prominent international VP Hugo Barra, who’s now joined Facebook to lead its VR expansion.
Apple, on the other hand, has been continuously losing ground in the Chinese market. The company also mentioned in its recent quarterly earnings that they’ve had another flailing quarter of sales in the Dragon’s land. iPhone sales dropped nearly 12 percent year-on-year during the quarter that ended December 2016.
The report attributes the decline in sales for a renowned brand like Apple to rapid implementation of new technological advancements into smartphones and other electronic devices. These brands — Huawei, Xiaomi, and Oppo — managed to cover much ground last year due to the inclusion of “dual cameras, thin bezels, and digital headphone connectors.” They’ve also aggressively been using offline sales channels and advertising campaigns to reach a wider user base in its home country. It is only the beginning of 2017 and Chinese smartphone brands are said to be integrating improved dual-camera setups and curved screens into their phones already.
Despite its massive decline in sales in the last year, IDC analysts are positive about the company’s growth this year. The iPhone 7 lineup has failed to grab the attention of a multitude of consumers but there’s much anticipation of a completely redesigned 10th anniversary ‘iPhone 8’ among users. The report further adds,
Most Apple users are expected to be holding out for the new iPhone that will be launched this year, and that will help the brand to see a growth in 2017. Apple’s 10-year anniversary iPhone will also likely attract some of the high-end Android users in China to convert to an iPhone.
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