Apple of China, Xiaomi, and its American rival are losing market share

While the so-called Apple of China, Xiaomi, and its American rival are losing market share in the world’s most populous country, three of China’s homegrown handset manufacturers continue to gobble up turf. That’s according to the latest from IDC Research’s Chinese smartphone tracker.

Xiaomi and Apple still rank among the top smartphone vendors in China’s saturated smartphone market, but their marked year-over-year decline for the second quarter of 2016 gave way to the continued rise of vivo, Huawei, and OPPO.

OPPO and vivo saw a respective 124.1 percent and 74.7 percent increase, year over year, and Huawei continued to hold serve with a solid 15.2 percent increase from the second quarter a year ago. For the second quarter of this year, Huawei held the most market share of the three with a 17.2 percent stake in China. Combined, the trio held about a 47 percent share of the market.

Meanwhile, Apple and Xiaomi’s share each shrank by over 30 percent as the pair held market shares of 8.6 percent and 10.5 percent respectively. A year ago, Xiaomi was coming off of a second quarter that saw it claiming 17.1 percent of the market. Ouch.

While Apple’s stake has fallen victim market saturation and a range of powerful mid-tier offerings from Chinese vendors, senior analyst Xiaohan Tay, of IDC Asia/Pacific, indicated that Xiaomi might have empowered those rivals. “In the past, Xiaomi started the trend of selling its phones online and other vendors soon followed suit and created their own online brand,” Tay said.

Furthermore, when OPPO found a way sustain growth out of the replacement market, the other Chinese vendors hopped aboard that bandwagon as well. “After vendors witnessed OPPO’s success with its R9,” said Tay, “they also started riding on the trend of hiring celebrity endorsers to represent their brand and appeal more to the young crowd.”

Xiaomi started the trend of selling its phones online and other vendors soon followed suit.

While it has been a rough stretch for Apple and Xiaomi, next year could see at least one of the two get back on track. Although Apple’s marketing genius could convince everyone to adopt what’s widely expected to be an incremental update to the iPhone series this fall, many analysts are expecting Tim Cook’s company to come back strong with big updates to the iOS line next year.

It’s worth noting that Samsung isn’t having a great time in China right now either, but the company is nevertheless holding strong on the global smartphone market.

What are your thoughts regarding the rise of Huawei, OPPO, and vivo in China? An indicator of things to come, or a bubble soon to burst? Give us your take in the comments below!

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