China’s Huawei used to be all about flooding the planet with cheap, unbranded cell phones, but after it dumped that unsuccessful business model, the company has managed to become a globally recognizable brand.
Not to jinx it or anything, but today’s Huawei is something Apple and Samsung – the current leaders in the smartphone industry – should worry about.
Spreading like fire across new markets worldwide, Huawei has surprisingly become the world’s number three smartphone brand with an 8.3 percent market share. The Chinese company has had loads of success in Europe, where the brand is easily recognized on the back of better products.
Even though it now knows international fame, Huawei has raised from humble beginnings in Shenzhen in 1987, where it started as a manufacturer of phone switches. By 2012, it became the global leader in telecommunications networks, despite having been banned by the US government.
Huawei’s profit saw a 33 percent spike in 2015 after China’s No 1 maker of telecommunications gear grabbed market share with premium smartphones, enabling mobile carriers to expand their high-speed networks globally.
But even if it has gained fame in telecommunications networks, Huawei stands to make the most waves in the smartphone business. Last year, the company reported that it sold 108 million devices; while the number is commendable, it’s still far behind Samsung and Apple, at 324 and 231 million units, respectively.
But fear not – Huawei is doing its best to close the gap as fast as possible. This year, Huawei’s trajectory is looking even steeper, as the company sold 28.8 million phones only in its first quarter, the equivalent of more than a 10 million unit year-on-year increase.
While Huawei enjoys the journey to the top, Samsung’s reports showed the company’s sales stayed flat, and Apple actually went into decline – for the first time ever.
So how did the Chinese manufacturer achieve the new global market position? By working to drastically increase the quality of their phones, in addition to investing in major ad campaigns that let the world know about Huawei.
At first, Huawei was content to reach for low-hanging fruit, selling cheap handsets, and let the big brands of the world enjoy the premium tiers at the top of the consumer tree. But that’s about to change.
Image Source: CNET