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How OnePlus toppled Samsung and Apple in the cutthroat smartphone segment

How OnePlus toppled Samsung and Apple in the cutthroat smartphone segment

How OnePlus toppled Samsung and Apple in the cutthroat smartphone segment
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By Salmanul Farisy  Aug 7, 2018 10:02:59 AM IST (Updated)

OnePlus One, the company's first phone became a sensation right after the launch.

Not long ago, Samsung and Apple ruled the roost in India’s premium smartphone segment. Then came OnePlus.

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Within four years of its launch in India, the company has become the 'flagship killer' in the lucrative smartphone segment. Its phones surpassed storied products from Samsung and Apple to lead the growing Indian premium mobile phone segment in the second quarter of 2018-19, growing at 284 percent, according to a Counterpoint research report.
Pete Lau, CEO of OnePlus, was understandably gushing about India. “India as a market has emerged as a frontrunner in what has been an incredible journey, making for almost 1/3rd of the company’s revenue in 2017," he said in a recent blog post.
Incredible journey? You bet!
OnePlus One, the company's first phone became a sensation right after the launch. The phone created a huge buzz in the market with its clean software, great hardware, the relatively affordable price of Rs 19,999 for a phone with high-end specs and features such as camera, performance, storage capacity, the battery that the phone offered. OnePlus One sold more than 1.5 million units in the first year of launch.
"We planned to send around 5,000 units to India to control risk, as we were still skeptical about how the market would react. However, when we finally launched in India, we were pleasantly surprised to see that over 2 lakh people had signed up for the invitation," Lau said.
The company quickly ratcheted up $1 billion in revenue in 2017. Its latest flagship OnePlus 6 sold 1 million units in 22 days after launch.
So what is working for OnePlus?
The features and specifications of OnePlus phones are similar to other flagships from Samsung and iPhones to an extent. The OnePlus 6 sports an all-glass design, a large 6.28-inch display, dual rear-facing cameras, software bringing it in line with other flagships such as the Samsung Galaxy S9 and iPhone X.
The phone comes with face unlock which the company claims that it can recognise and unlock the phone in 0.4 seconds. But there was a vital difference — pricing.
The OnePlus 6 launched 6GB RAM variant at a price tag of Rs 34,999 and the 8GB RAM/ 128GB inbuilt storage cost around Rs 39,999. The price of 8GB RAM, 256GB variant is Rs 43,999.
Its immediate competitor Samsung Galaxy S9 costs Rs. 57,900 for the 64GB storage variant, Rs 61,900 for the 128GB variant and Rs 65,900 for the 256GB variant. The iPhone 8’s price in India starts at Rs 64,000 and iPhone X costs more than Rs 90,000.
“I am getting almost all the features and specifications offered by Samsung for a better price,” said Nihal TT, a chartered accountant trainee who has been using OnePlus Two for nearly three years. “There is no reason why I should not choose OnePlus."
After the success of OnePlus One, the company launched OnePlus Two and OnePlus X in 2015. Both the phones sold over half a million units between April 2015 and March 2016, according to Counterpoint.
But it was in 2016 that the company launched its first genuine 'flagship killer' — OnePlus 3. The phone received rave reviews from tech experts.
The clean software and rich features of Oxygen OS made the phone a superb performer. "OnePlus 3 exceeded expectations in many departments considering the size of the company and growing into a challenger brand," wrote Neil Shah, an industry Analyst, in Counterpoint research.
The company's next launches OnePlus 5 and OnePlus 5T also did well in the Indian and global markets.
With the OnePlus 6, the company has broken into the top of the table. OnePlus’ dizzy success underscores the importance of a company not only producing a super product but also following up with better products.
"With every flagship, OnePlus userbase has been growing in India and this has now started translating into record sales for every new flagship it launches. The brand is also capitalising on strong word of mouth and leveraging social media effectively to reach out to its target userbase," said Tarun Pathak of Counterpoint research.
OnePlus is also acutely aware of an inherent characteristic of Indian consumers — their price consciousness. Pricing has helped OnePlus to steal a march over competitors. OnePlus is an example of what innovative pricing can achieve in partnership with unique marketing and quality delivery, said a tech analyst.
It offered smartphones packed with high-end specs but at lower prices than competing models.
Even though the company promoted the phone as a device for those who want high-end specs under affordable prices. Also, marketing it under invite-only mode raised the bar in terms of customer expectations and created a halo around the product, the analyst said.
The management also listens to customers and try to resolve issues and account for suggestions put forth by users.
The company is likely to launch OnePlus 6T this year or OnePlus 7 next year. The new launches too are unlikely to disappoint.
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