Apple’s and Xiaomi’s Smartphone Share Declined in 3Q 2019: Gartner

  • Huawei, Samsung, and Oppo were able to increase their market shares in the third quarter of 2019
  • Gartner report also pointed out towards weak global demand for smartphones in the same quarter

Global sales of smartphones to end users continued to decline in the third quarter of 2019, contracting by 0.4 per cent compared with the third quarter of 2018, according to Gartner, Inc. Demand for smartphones remained weak as consumers became more concerned about getting value for money.

“For the majority of smartphone users, desire has shifted away from owning the least expensive smartphone. Today’s smartphone user is opting for mid-tier smartphones over premium-tier ones because they offer better value for money,” said Anshul Gupta, senior research director at Gartner. “In addition, while waiting for 5G network coverage to increase to more countries, smartphone users are delaying their purchase decisions until 2020,” he added in the report.

Focus on the mid-tier portfolios

This shift, as per Gartner, has led brands such as Samsung, Huawei, Xiaomi, Oppo and Vivo to strengthen their entry-level and mid-tier portfolios. This strategy helped Huawei, Samsung and Oppo to grow in the third quarter of 2019.

By contrast, Apple recorded another double-digit decline in sales, year over year. The compay was able to sell 40.8 million iPhones, a year-over-year decline of 10.7 per cent. “Although Apple continued its sales promotions and discounts in various markets, this was not enough to stimulate demand globally,” added Anshul Gupta

Samsung maintained the No. 1 position globally in the third quarter of 2019, by increasing its smartphone sales by 7.8 per cent, year over year. “Samsung’s aggressive revamp of its portfolio, with a focus on mid-tier and entry-tier segments, strengthened its competitive position,” noted Anshul Gupta.

Huawei only brand to register double digit growth

Huawei, as per the report was the only one of the top five global smartphone vendors to achieve double-digit growth in smartphone sales in the third quarter of 2019. The company sold 65.8 million smartphones, an increase of 26 per cent, year over year. Huawei’s performance in China was the key driver of its global smartphone sales growth. It sold 40.5 million smartphones in China and increased its share of the country’s market by almost 15 percentage points.

Gratner’s report read, “While the ban on Huawei to access key U.S. technologies is yet to be fully implemented as a three-month extension was just announced, the proposed ban brought negativity around Huawei’ brand in the international market. Nevertheless, Huawei’s strong ecosystem in China continued to show growth. The current situation with the U.S. has also fostered patriotism among Huawei’s partners, which are now keener to promote its smartphones in China — a development that makes it difficult for local competitors to compete aggressively against Huawei. Huawei’s long investment in sub-brands (Honor and Nova), in multi-channel operations (online and retail), and in 5G and other technological innovation forms the basis of its success in China.”

Black Friday and Cyber Monday may stimulate smartphone sales

With Black Friday and Cyber Monday approaching, smartphone deals are likely to spur consumer demand in the fourth quarter of 2019. Vendors including Google and Samsung are likely to offer aggressive price promotions not just for their older smartphones but also for new devices such as the Google Pixel 4 and Samsung Galaxy Note 10.

Competition between mobile phone manufacturers will increasingly focus on more intelligent smartphones. These devices will deliver increasingly personalised content and services that draw on users’ contexts and preferences.

“To deliver relevant personalized experiences, manufacturers will need to improve the integration of artificial intelligence (AI) in smartphones and make security capabilities and privacy key aspects of their brands,” said Roberta Cozza, senior research director at Gartner.