Domestic smartphone brands are gaining popularity in China’s less-developed markets, forcing foreign brands to question their approach
It was a bitterly cold December morning in China’s capital, with only a few pedestrians meandering along the icy sidewalk, lacking any great sense of purpose or urgency. The Apple Store they passed wore a forlorn look, which was surprising because this day marked the Beijing launch of Apple’s iPhone 5. In the past, an iPhone launch meant that consumers would queue up in front of this store in the wee hours of the morning and anxiously wait for it to open. During the launch of the iPhone 4S, a riot nearly ensued before police intervention.
“Domestic players have a much deeper understanding of Chinese customers’ needs,” says Jeffrey Yang, Huawei’s Vice-President and Chief Marketing Officer for China. “R&D centers are mainly located in the China market already. They can respond to customers’ needs immediately. For the international brands like iPhone and Samsung… it really takes a long process to meet those needs.”
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[This article has been reproduced with permission from CKGSB Knowledge, the online research journal of the Cheung Kong Graduate School of Business (CKGSB), China's leading independent business school. For more articles on China business strategy, please visit CKGSB Knowledge.]