Chinese smartphone makers Xiaomi and Lenovo have lost their spots as two of the top five global smartphone vendors, according to a new report from the International Data Corporation (IDC).
The companies, which formerly held market shares just below smartphone giants Samsung, Apple and Huawei, have been replaced by lesser-known Chinese brands OPPO and vivo, the report said. OPPO has supplanted Lenovo in the number four spot with 5.5 percent of the market share, while vivo managed to bump Xiaomi from the list with its 4.3 percent market share.
The news is just the latest setback for Xiaomi, which missed its shipment goal of 80 million units for the full year 2015.
According to the report, both OPPO and vivo managed to more than double their market share year over year from 2.2 percent and 1.9 percent in 2015, respectively. The companies also more than doubled their shipments, with OPPO jumping from 7.3 million units shipped last year to 18.5 million this year and vivo increasing shipments from 6.4 million in the first quarter 2015 to 14.3 million a year later.
Both companies have been shipping devices since 2011, but OPPO took the first leap into international shipping in 2012. The company first made its devices available in Thailand before branching out throughout Southeast Asia and more recently to other countries in Asia, the Middle East and Africa. Nearly 20 percent of OPPO’s shipments were sent outside China in 2015, the report said.
IDC said vivo was a little slower to branch out from its domestic focus and first tested the global waters in 2014 with its entrance in the Southeast Asia and India markets. Less than 10 percent of vivo’s device shipments in 2015 were sent outside China, the report said.
IDC said the key to OPPO and vivo’s massive growth has been their retail presence and marketing efforts in lower-tier markets as the Chinese smartphone market has matured. Competitive price points have also helped the brands, IDC said.
Despite the outsider gains, Samsung and Apple retained their comfortable leads in first and second place with 24.5 percent and 15.3 percent of the first quarter market share, respectively. Huawei trailed in third with 8.2 percent of the market share, but appeared to have made gains on Apple year over year.
If they hope to continue their dominant peers, IDC said both OPPO and vivo need to do more to raise their brand awareness in more mature markets.
“Outside of China, many of these brands are virtually unknown and the ability of these rapidly growing Chinese vendors to gain entry into mature markets such as the United States and Western Europe will be essential if they have aspirations of catching Apple or Samsung at the top,” said Anthony Scarsella, research manager with IDC’s Mobile Phone team. “While Huawei is furthest along in terms of international recognition, selling equally impressive volumes outside of China remains a challenge for many of these brands, whether it is Xiaomi, Lenovo, OPPO, or vivo. Their ability to drive local growth no longer applies when it comes to international expansion, where premium branding quickly turns to price competition.”
Though OPPO and vivo have pulled ahead for now, Xiaomi may be the first to try its hand in the U.S. market. The company in February confirmed it is planning to make its entrance into western markets sometime before the end of 2017.
