It looks like that Huawei‘s low price smartphone strategy is starting to pay off. During the last year huawei has increased sale of Honor lineup from 1 million to 20 million units. Chinese manufacturer company, Huawei has become the fourth largest smartphone seller in the world and there is no doubt that its strategy to sell smartphone on low prices helped it a lot to achieve this landmark.
According to Reuters, Huawei has managed this achievement through adopting an online only approach coined by its smaller rival, Xiaomi. This online approach is seen as a major factor to reduce costs in the competitive low cost smartphone markets.
Given the early signs, Huawei executives hope to emulate the phenomenal growth of Xiaomi, which broke into the global top five in just a few years a success not likely to go unnoticed by the growing ranks of low-cost Chinese smartphone makers. But analysts say the low-cost strategy could affect margins for all makers.
Honor brand president Jeff Liu said that industry transition to an online sales strategy was inevitable given the competitive pricing, afforded by reduced distribution expenses that would otherwise make up 30 percent of handset costs.
However in China Huawei is not the only smartphone maker to be noticed, Xiaomi is using online approach already and in October 2014 Lenovo Group Ltd also announced to adopt the online approach after their statement that they would sell a line of devices by Internet only.
Any how we can say that low price smartphone strategy of Chinese manufacturer company, Huawei has paid off for them. As Huawei increased its selling and became fourth largest smartphone seller on the planet.