Chinese smartphone brands are among the big winners in the Australian smartphone market as Samsung grows their share, with the Galaxy 7 and Apple is walloped as consumers transition from an iPhone to an Android device, according to new IDC research.
IDC said that year on year, the Australian smartphone market has fallen by 18%.
While the Australian market slipped 18%, from 2.2 million units in Q2 2016 to 1.8 million units’ Chinese brands such as Alcatel and Huawei continue to grow share despite Huawei taking fourth spot with 3.5% market share as they launched the much anticipated flagship P9 as well as the Mate 8 towards the end of the quarter.
IDC said that the majority of Huawei’s market share came from Y series models in the sub AU$100 price bracket.
IDC said that 96% of all mobiles shipped were smartphones. “The market has reached its saturation point for a while now and shipments are driven more and more by refresh cycles rather than first-time purchases” says Bilal Javed, Market Analyst at IDC Australia.
One of the biggest losers was Apple who IDC claims continues to “struggle”.
Their market share plummeted from 48% in 2016Q1 to 40% in 2016Q2.
Recently, Apple experienced its slowest quarter in over 2 years. Slow down at the top has allowed other vendors to join the playing field, with mid-range vendors benefiting the most IDC claimed.
It now appears that iPhone owners are deserting Apple in favour of Samsung Smartphones in particular the new Samsung Galaxy 7 with its curved edges.
In their latest report IDC said that Samsung consolidated their second spot in Australia as they rode on the success of the highly rated flagship handsets, Galaxy S7 and Galaxy S7 Edge and closed in on Apple to grab 33% of the market as compared to 31% in 2016Q1.
Features of the flagship device such as removable storage, waterproofing and A faster processer grabbed consumer attention and accounted for over 63% of Samsung’s shipments.
“Whilst the Galaxy S7/S7 Edge was locking horns with Apple devices, the refreshed J series (J1, J1 Mini and J3) along with the still successful Galaxy S5 was Samsung’s answer to the other Android vendors in the low/mid-market space” says Bilal.
Another big winner was Alcatel who now claim over 5% of the smartphone market as they consolidated their hold on the low-end space.
The Chinese brand who is set to launch new midmarket Idol 4, in September is now in third spot behind Apple and Samsung.
The targeted strategy of pre-paid phones exclusive to telco providers is the key driving force behind Alcatel shipments.
IDC said that ZTE came in fifth in the Australian market. A key partner of Telstra they produce the bulk of Telstra’s house brand smartphones.
Vendors such as LG Electronics and HTC had a disappointing quarter as their much hyped flagship LG G5 and HTC 10 did not live up to expectation.
“Australian consumers are becoming increasingly aware of alternative buying options in smartphones and the lack of innovation, minimal marketing and high price point of the device forced HTC out of the top 5.
A major surprise came for OPPO who’s smartphone range was recently ranged by JB’s i-fi following the demise of Dick Smith. Their share has grown significantly following the move to JB hi-fi and the introduction of extensive EDM marketing by the mass retailer along with extensive online marketing for the Chinese brand.
IDC said OPPO experienced triple digit growth and could move onto challenging the likes of HTC, Huawei, LG and Microsoft in the near future” adds Bilal.
The IDC analyst said that the recent slowdown may simply be the calm before the storm, as major launches from Apple, Samsung and the new Google Nexus device are pending in the coming quarter. “These product launches are likely to return the market to positive growth YoY and shipments are expected to break the 2M barrier” adds Bilal.
Vendors following the big 2 will need to continue to innovate and provide attractive value propositions to gain market share he added.