Vietnam 2nd fastest-growing smartphone market in SE Asia: GfK

Vietnam 2nd fastest-growing smartphone market in SE Asia: GfK

Vietnam came second among the three fastest growing smartphone markets in terms of volume turnover in Southeast Asia in the past 12 months, a German market research firm said Tuesday in a press release.

During the Sep 2013 – Aug 2014 period, Vietnam reported 56 percent increase in smartphone demand compared to the previous period, Sep 2012 – Aug 2013, GfK said, citing findings from its latest survey.

Vietnam stood behind Indonesia, which posted 70 percent spike, and was followed by Thailand, where demand for smartphone expanded 44 percent.

“In value terms, it was Vietnam, Indonesia and Thailand which drew in 52, 32 and 31 percent increased sales dollars against last year,” the GfK said.

The latest GfK findings for the smartphone ownerships in seven key Southeast Asian markets, including Singapore, Malaysia, Thailand, Indonesia, Philippines, Vietnam and Cambodia, show that sales of the hi-tech devices in these countries reached more than US$16.4 billion in the past 12 months.

Total smartphone sales at these seven markets in the Sep 2013 – Aug 2014 period rose to nearly 120 million units, according to the market research firm.

GfK said smartphone sales in these countries spiked by 44 percent in volume and 24 percent in value compared to the same period a year ago.

“The big developing countries are the ones fuelling the strong surge in adoption as many outside the big cities are probably just making the switch from their basic feature phone and acquiring their first smartphone,” Gerard Tan, Account Director for Digital World at GfK Asia, said in a statement.

“For instance, the markets of Indonesia, Vietnam and Thailand have performed extremely well this year, reporting high growth of over 30 percent in generated revenue and even more in sales volume.”

Tan said the introduction of more low-end models by new Chinese manufacturers is a key driver that fueled the strong market performance especially in the developing countries as they “make smartphones more affordable.”

“These budget smartphone models have gone down particularly well in the developing markets,” Tan said, adding they would take competition in the marketplace to “an even more intense level.”

Indonesia is the only market where homegrown brands have continued to grow in popularity, garnering over 16 percent share in volume and 7 percent share in value of the local market.

Meanwhile, Chinese smartphone brands are more prevalent in Indonesia, Malaysia, and Vietnam where their respective proportion of consumer spend have reached more than 10 percent of the total market.

“Although international brands dominate the region’s smartphone market, Chinese brands are gaining significant presence,” Tan stated.

“Major international brands are losing shares to the Chinese brands in price competition due to the low-cost of the latter which are selling their smartphones, including phablets, within the $50 to $200 range.”

More than 345 Chinese branded smartphones now exist across the Southeast Asia, according to GfK.

While an internationally branded smartphone averaged at around $253, a Chinese branded one cost only $159, or 58 percent lower.

“Competition in the market will further intensify, as Chinese manufacturers are stepping up their activities in more countries, notably Singapore, Philippines and Thailand,” Tan commented.

Tan added fierce competition in the region is anticipated as several international brands are poised to launch new models there.

Consumers will be the “eventually winners who will gain from the price wars” between the brands, he concluded.

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