'One Phone At A Time' Strategy Will Give Us Chance To Focus More: Vikas Agarwal, OnePlus
A four-year-old Chinese smartphone brand has surpassed the giants like Samsung and Apple in India. It has achieved the first rank in the Indian premium smartphone segment, and the brand is none other than OnePlus.
According to Counterpoint Market Monitor Service Data Q2 2018, OnePlus has emerged as the leader in the premium smartphone segment ($400 and above) in India with 40 per cent market share, followed by Samsung and Apple at 34 per cent and 14 per cent, respectively. Also, It was the fastest growing smartphone brand annually, growing at 446 per cent.
In an interview with BW Businessworld, Vikas Agarwal, General Manager, OnePlus India talks about the journey so far and what lies ahead.
When asked about factors resulted in the exponential growth of OnePlus’ market share, Vikas stated, “Since the inception of OnePlus, the goal of the company has been to make a premium smartphone that we ourselves would want to use.”
He mentioned two key elements that they rely on to deliver a premium user experience, high-spec hardware with bloat-free software in the form of OxygenOS.
“Our product strategy remains to stay focused and develop one-flagship a year. So, we put in our energies in creating the best version of our one product each year and that is highly efficient and appreciated by the OnePlus Community. Our one-flagship-a-year strategy has helped us stay focused on creating superior products with premium user-experience”.
Being a community-focused brand, OnePlus is well connected with their users through social media and online channels like forums. They gather feedback from them and even implement the insightful ones. With this information, the handset maker is able to create a new model each year which fit the needs of a premium smartphone user.
Sales And Business Model
Around 90 per cent of the Indian premium smartphone market is comprised of OnePlus, Samsung and Apple where the latter two brands have a huge product portfolio. On the other hand, OnePlus focuses on a one-model-a-year strategy where they only bring one flagship model per year and its refreshed model under the “T” moniker, if needed.
Unlike Apple and Samsung, which continue to sell their older phones even after the launch of the new flagships, OnePlus halts the sale of older models and focuses on selling only the latest model. In short, you’ll find only one option to buy from OnePlus, you can’t get OnePlus 5T (Review) and OnePlus 6 (Review) at the same time.
From the past two years, there has been a trend within OnePlus where they bring a “T” variant of their flagship models. The reason behind this approach is to bring the latest technological upgrade in the second half of the year, which our community might find relevant and valuable. We try to bring a refreshed variant so as to be able to provide our customers with the option of availing the latest technology at all times. Two such examples of refreshed models are our 3T and 5T variants.
Does this imply that OnePlus 6T is confirmed? Well, the company didn’t confirm anything, however, if they find any incremental technology upgrade, then they might consider launching an OnePlus 6T this year too.
“The one-device-a-year strategy has worked for us so far and our users have also appreciated the focus we put on one device, so we are not tempted to bring in more flagships every year.”
Talking about launching phones in lower price segment, Vikas said, “OnePlus will not alter its price range and get into a lower price segment”.
He further added, “We have consciously refrained from entering into multiple categories because we believe that it dilutes the value of the brand in the long run and we also have realised from our experience that it is not what our users expect from us”.
Offline Expansion Plans
Being a brand which extensively follows the online business model, OnePlus believes that online to be a dominant channel after five years. However, the company is eyeing offline expansion and increasing its footprint across India. Selling through brick and mortar is one of the key focus areas for OnePlus for this year.
The simple reason for increasing the number of offline touch-points is to enable community members to engage with the brand and to allow for experiencing the product before buying. With these experience zones, the company also aims to introduce OnePlus products to potential new users, strengthen user trust and further complement our online business.
Last year, the premium smartphone maker launched its first OnePlus Experience Store in Bengaluru, which allows consumers to experience the phone. According to OnePlus, the success of this store format was evident from the spike that the company saw in online sales in the region.
The Chinese brand will be will be launching 14 more such offline touch points by the end of the year across key cities including Mumbai, Ahmedabad, Delhi and Kolkata.
Even though OnePlus plans to expand its roots in the offline channels but their primary sales plan will be based on online and offline will act as a top-up.
India as an Important Market/ India
OnePlus is present in over 35 countries with a major presence in Europe, the US, India and China region. Launched in December 2014, India has quickly surpassed other regions to become the biggest and the most important market for OnePlus.
Out of the $1.4 billion revenue of OnePlus in 2017, India accounted for over one-third of their global business, only behind China, Europe and the US.
OnePlus finds India as the world’s fastest-growing smartphone market - a land of opportunities. The smartphone maker also believes the right strategy to be key to their success in the Indian market.
“If you want to be succeed as a brand in India, you must truly understand the needs of the Indian market. India is a fast-growing market with tremendous potential and a very discerning customer base. By catering to India-specific needs, the country has today become a community that is our eye to the globe, a soundboard for experimentation through, which we understand the pulse of the customer at a global level. It has become our benchmark for creating successful global products.”
The company intends to move deeper into the ‘Make in India’ strategy and is presently finalizing plans for local component manufacturing and sourcing.
With an R&D centre coming up in India, the focus being on decentralisation to make India their second headquarters and the sheer potential that India offers, the brand is looking to explore further exponential growth in the market.
Competition With Other Brands in the Premium Segment
Looking at the premium segment, every phone above Rs 30,000 is a competitor of OnePlus devices. So what does the brand think about its competition?
"We do not really treat other brands in the market as competitive as we rather focus on improving ourselves towards creating the next best user experience for our customers. We believe that our products outshine most others in the category, in terms of build quality, performance and design. It can be rightly said that we are our own biggest competition right now."
OnePlus believes that Indian consumers really like their products and the reason behind this is the value of the product the brand offers.
The premium smartphone market contributes only four per cent of the total smartphone market in India and it is still budding. This segment, in India, is growing at around 20 per cent year-on-year, which is a promising projection to suggest that more and more Indians are upgrading to premium smartphones.
"Forty per cent of our customers are repeat buyers of OnePlus devices, which also indicates that once a user uses a premium device, there is little chance of reverting to a lower-end smartphone. These figures indicate that the opportunity is immense in India and is only bound to grow. We as a brand are open to exploring the opportunity the market presents and strive to be here for the long haul."
OnePlus’ Evolution Since Last Year
The company believes that they have remained consistent with their approach and will continue along with the same lines in the future. The company’s focus on product and community continues to be at the centre of everything.
The brand which has been heavily reliant on word-of-mouth has also maintained its position amongst the top three premium smartphone makers in India for the last three quarters. The company’s latest offering OnePlus 6 has been their fastest selling smartphone till date, selling over 1 million units within just 22 days of its global launch.
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