In a note trying to explain the success of the Chinese company in markets like India, Prabhu Ram, head of Industry Intelligence Group at the firm also called it the ‘best that OnePlus has ever come up with’ and a ‘runaway success’.
“The OnePlus 6 secured approximately 3 million pre-launch ‘Notify Me’ registrations, beat the entire launch day sales record previously held by its predecessor OnePlus 5T within just 10 minutes of launch, and grossed the highest ever revenue on any single day on Amazon,” Ram said.
The success of OnePlus is at once surprising and predictable.
The company, which entered India about five years ago, has been steadily building a reputation for delivering high-end devices at affordable prices.
While companies like Samsung, Sony and LG too build high-end devices, they are less focused on the second part — affordable prices.
Samsung’s high-end devices are priced in the Rs 55,000-60,000 price range, and Sony’s even higher, while OnePlus always prices its in the range of Rs 32,000-37,000, depending on the exact specifications (OnePlus 6 is priced 35k to 40k).
While it was only those willing to experiment with a new brand who tried out the brand in the initial days, the brand has in the last two years gained universal acceptability among the tech-savvy, online-shopping generation by sheer word-of-mouth and user feedback.
In doing so, OnePlus has clearly overtaken Xiaomi, India’s largest smartphone brand and another company that drives sales through word-of-mouth, in the premium category.
Xiaomi’s high-end devices manage only a small fraction of the sales recorded by OnePlus partly because they don’t usually go whole hog in trying match flagships from Samsung and LG like OnePlus does.
Also what seems to have worked for OnePlus, said Ram, seems to be the company’s decision to not spend any money on traditional advertising, and instead channel the savings to the consumer in the form of lower prices, and to focus instead on design, quality and specifications.
“The OnePlus success, perhaps then, boils down to its customer centricity, and the innate value that OnePlus invests in seeking user feedback and relying on the word of mouth to drive their brand recognition and in turn, their sales,” he said.
The company typically releases one new model every six months, or roughly when a new flagship chipset becomes available from Qualcomm.
“Given its consistency in delivering timely updates, the OnePlus has continued to gain the trust of its users. With the OnePlus 6, the company has proved that it means business,” Ram said.
Besides saving on marketing costs, OnePlus and Xiaomi also cut down prices by limiting the number of models they manufacture.
The focus on a single device at a time, in case of OnePlus, helps the company generate enough volumes, order components in bulk, and reduce the ‘bill of materials’.
It also means that OnePlus does not have to invest in huge manufacturing facilities. Instead, the Chinese companies have a focused assembly lines that are kept busy throughout the year, reducing costs.
“It is able to maintain a high demand and manage stock levels, by focusing on churning out new handsets through limited production runs throughout the year,” Ram pointed out.