Russia’s Smartphone Market Faces Bright Outlook; 2015 Annual Sales Up 22%
January 19, 2016 | TrendForceEstimated reading time: 2 minutes
“The market penetration of mobile phones in Russia reached 170% in 2015,” said Kelly Hsieh, senior manager for mobile communication and end device research at TrendForce. “However, the local demand for mid-range and low-end smartphones is rising steadily. Russian consumers are choosing more economic smartphone models as their country’s economy is under pressure from the U.S. and E.U sanctions.”
Based on TrendForce’s data, 67.8% of smartphones sold in Russia during 2015 were priced below US$124 on average. Demand growth in the mid-range and low-end segments has contributed to the rapid rise of vendors such as U.K.-based Fly and Russia’s own Explay. Chinese vendors that are known for offering products with high cost-performance (C/P) ratios – Lenovo, Huawei and TCL – have also been actively developing the Russian market in recent years and raising their brand recognition there.
U.K.-based vendor Fly has risen to challenge the Chinese expansion in the Russian smartphone market
“Following India, Russia has become the next major battleground among the Chinese vendors,” said Hsieh. Lenovo, for instance, has released a multitude of mainly large-size device models into the Russian market, including A7000 Plus, Phab, Vibe P1, A2010 and Vibe P1m.
In contrast to Lenovo’s attempt to flood the market with its products, Huawei’s strategy has been more focused on marketing. Since 2014, Huawei has opened more than 10 chain retail stores across Russia to raise its brand profile. Huawei’s intention to take on the Russian mobile phone market was made more evident with the local release of its flagship smartphone Honor 7 and smartband Honor Band Zero in September 2015.
The increasing demand for mid-range and low-end smartphones in Russia has led to the accelerated growth of other vendors including Fly and Explay. In 2015, Fly became the second largest vendor in the country with a market share of 9.5%. The vendor surpassed Lenovo and Apple and was only behind Samsung. In sum, the competition in the Russian mobile device market is expected become tougher for international smartphone brands.
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