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Lenovo aims to locally manufacture 50% of smartphones sold in India by 2017: Sudhin Mathur

Recent reports by Canalys and IDC states Lenovo (combined with Motorola) took the third place in Indian smartphone market moving past Intex. Samsung continued to stay on the top followed by Micromax in second place.

twitter-logoNidhi Singal | March 2, 2016 | Updated 12:16 IST
Sudhin Mathur, Director-Smartphone Business, Lenovo Mobile Business Group

Recent reports by Canalys and IDC states Lenovo (combined with Motorola) took the third place in Indian smartphone market moving past Intex. Samsung continued to stay on the top followed by Micromax in second place. Sudhin Mathur, Director-Smartphone Business, Lenovo Mobile Business Group in conversation with Business Today talks about the dual brand strategy and the future strategy.

BT: Canalys and IDC both are claiming Lenovo Motorola combined have managed to reach the third place in the Indian smartphone market on shipment basis. What is your current market share in India and combined shipments for the last quarter?

Mathur: Lenovo currently has a market share of 11.6 per cent of the Indian smartphone market according to the recent IDC Q4 2015 report. Our continuous focus on introducing value offerings through the dual brand strategy has helped us register a healthy 10.8  per cent sequential growth in shipments.

BT: From not being in top 5 players to reaching the number 3 spot in just a couple of years, how did Lenovo manage to achieve this?

Mathur: Lenovo has been focusing on bringing products ahead of competition to India and offering innovation along with a value proposition. Lenovo's dual brand strategy has helped the brand register a healthy sequential growth in shipments. Lenovo's sub-brands - Moto and Vibe - have been effectively positioned in the market with Vibe offering best technology for money and the aspirational Moto offering premium features and consumer experience.

A strong relation with different channel partners across all mediums is the key advantage that Lenovo has over competition. Reaching out to more centers in the country is our focus point towards expansion which we are approaching through both online and offline mediums.

BT: Which have been the top selling models for Lenovo as well as Motorola in India?

Mathur: Lenovo's entire 4G portfolio particularly has been a great success in the Indian market with devices such as K3 Note, Moto G (3rd Gen), Moto X Play, Moto E (2nd Gen), A6000 and A6000 Plus being the market favorites throughout 2015. Lenovo's K3 Note and Moto G (3rd gen) continue to be the top selling models for the brand.

BT: According to IDC's report, Micromax is at the 2nd spot with 14.1 per cent and Lenovo at 11.6 per cent. How long do you think Lenovo will take to reach the 2nd spot?

Mathur: According to the latest IDC report (Q4 2015), Lenovo is the number 3 smartphone brand by volume in India. Already we are leading the online sales segment with 25.4 per cent smartphone market share (as per IDC Q4 2015 report). While increasing our market share is certainly our aim, we are currently focused on continuing to understand consumer behaviour, leading the technological curve, introducing more innovative, future-proof devices and expanding our reach across the country.

BT: What is Lenovo's aim for the next quarter and the financial year?

Mathur: We are currently keeping pace with market trends with aggressive pricing of our 4G LTE smartphone portfolio. Further on, we intend to expand offline presence and fortify occupancy in Tier 2 and Tier 3 cities. Lenovo is committed to manufacturing in India and has already started rolling out devices such as Vibe A6010, Vibe A2010, Vibe K3 Note, Moto X Play, Moto G and Moto G Turbo. Lenovo plans to double its current manufacturing capacity from 6 million devices to 10 million devices. Our aim is to manufacture 50 per cent of our smartphones sold in India, locally, by 2017.

Additionally we are also looking at expanding our service base with close to 100 Exclusive Service Centers (ESC's) for Moto and Vibe smartphones by the end of next quarter.

BT: Will Lenovo come up with any India specific smartphone?

Mathur: Our product line-up has been designed keeping the Indian consumer in mind. India-specific customisation is high on Lenovo's agenda. We were amongst the first to recognise and fill the gap for quality devices in the under $200 price bracket. Similarly, we could foresee the need for 4G smartphones in the country well ahead of its launch and have thus been successfully leading the segment in terms of sales and market share with our products.

BT: Can you give a break-up of online and offline sales for the previous quarter?

Mathur: It is critical that online and offline channels are balanced for a brand and Lenovo is committed to ensuring a level playing field for its partners. While online retail is definitely on the rise and has helped us reach out to our consumers in over 1,000 cities, a majority of sales still come through the brick-and-mortar outlets as customers give great importance to the touch-and-feel experience on devices. In terms of shipments, approximately 62.7 per cent of Lenovo's sales are through offline channels.

Moto X Force (launched recently) is the first device from the Moto stable to be launched through the offline channel.

BT: How will the dual brand strategy help towards increasing your market share?

Mathur: One of the key advantages we have through our dual-brand strategy is that we are able to cater to all price segments in India effectively, which in turn helps us connect with a wider consumer base.

Globally, Motorola is a strong player in developed markets such as the US and Western Europe, while Lenovo is going strong in the emerging markets such as China and India. Through our dual-brand strategy, Lenovo becomes an even stronger competitor in rapidly growing emerging markets such as Latin America and India.

With the Motorola deal, Lenovo already has gained a widely recognised, iconic brand known for innovation, established relationships with wireless carriers and distributors in key markets, world-class engineering talent and as well as rights to the Motorola brand, 2,000 patents and a royalty free lifetime license to another 15,000 patents, that have fully globalised our smartphone business.

We have also made inroads into the 'smart connected devices' portfolio- which also includes mobile "wearable" devices. On the other hand, Motorola is reinvigorated and on the rise. It has demonstrated strong market momentum over the past few quarters, benefiting from aggressive restructuring actions and strong new products launches.

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