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Half of Chinese smartphone market owned by three vendors

07 Feb 17

The Chinese smartphone market is a hot place to be right now.

That’s according to the latest IDC quarterly Mobile Phone Tracker, which revealed the smartphone market in China surged 19 percent in year-on-year growth to 2017. Oppo, Huawei, and vivo led other smartphone brands in 2016, with the four Chinese vendors in the top five growing their collective market share from 46% in 2015 to 57% in 2016.

Senior market analyst with IDC Asia/Pacific’s Client Devices team, Tay Xiaohan says this shows the growing local acceptance of Chinese vendors in its home country with the improvement in product features and better marketing messages seen in the past year.

"Increased dependence on mobile apps has led to consumers to seek phone upgrades, thus helping drive the large growth in 2016Q4,” says Xiaohan. “In lower tiered cities, there was a similar demand by consumers, which OPPO and vivo met by aggressively pushing mid-range smartphones in these cities.”

What’s also interesting is the 2016 was the time ever that Apple saw a YoY decline in the Chinese market. However, IDC does not believe Chinese vendors have actually eaten away Apple's market share. Most Apple users are expected to be holding out for the new iPhone that will be launched this year, and that will help the brand to see a growth in 2017.

One of the key trends that stood out in 2016 was the slowdown of the growth of the online channel in China - there is no longer a single channel that is seeing exponential growth for smartphones unlike previous years.

Most brands are now utilizing a combination of channels to increase their shipments. Xiaomi, previously focused on online channels, has opened more Mi Home stores to drive offline growth. Apple has also been aggressive in increasing its offline retail presence.

According to IDC, here’s some of the things to expect from the China smartphone market in 2017:

  • Top vendors will continue to take up a larger share of the market while smaller brands will begin consolidation
  • Chinese vendors will continue to focus on their international expansion plans
  • Dual cameras and curved screens will become the norm for most flagships in 2017
  • Chinese vendors will be aggressive with other new technologies such as flexible screens, augmented reality and other new areas
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