Continuingly suffering from loses and loses at last HTC
decided to sell cheaper Smartphones to regain market share along with some net
profits. It will expand its range of cheaper products as it fixes off target
marketing for its premium Smartphones.
HTC is known for their great build quality and the
company has definitely built some solid Smartphones but it is constantly losing
profits to rivals like Samsung, Apple and even Chinese manufacturer like
Xiaomi. HTC is seeking to reverse a 2-years sales slump accompanied by an 80%
drop in its share prices.
"The problem with us last year was we only concentrated on our flagship. We missed a huge chunk of the mid-tier market,"-said co-founder and chairwoman Cher Wang, speaking to Reuters in New York last week alongside Chialin Chang, HTC's chief financial officer.
Just ahead of HTC earnings guidance presentation,
Chang said HTC will sell products in the$150 to 300 retail price range for both
emerging and developed markets, along with high end phones which can sell for
over $600. Though HTC won’t get into the “very very low end market”, but will
soon unveil a new flagship phone.
"The two cylinders are going to be fired together," Chang said.
Just over 2 years ago HTC supplied one in every 10 Smartphones
sold around the world. In 2013 its global market share had fallen to just 2%,
according to Strategy Analytics analyst Neil Mawston, and HTC last month
reported its second straight quarter operating losses.
A Taipei based analyst at BNP Paribas, Laura Chen said,HTC will need to move quickly in order to convince skeptical shareholders. "Only time will tell, but I'm not optimistic”. Chen who has a 'sell' rating on HTC shares also said “They don't offer anything really new to the market".
Marketing miss
Wang is looking to boost Smartphone sales this year
by improving its marketing, something she said her company “didn’t do well” in
2013. The flagship HTC One launched last year attracted rave reviews, these
didn’t translate to strong sales. The executive said, HTC needs a “very
aggressive campaign” to expand its market beyond tech-savvy 20 to 30-year olds.
To promote its sales last year HTC hired famous
Hollywood actor Robert Downey Jr in campaign labeled “Here’s to Change”.
HTC is hoping to improve their mid range Smartphone portfolio
and also incremental growth in the high-end phone market this year. The executives
said invitations will be sent out in about two weeks for an event where it will
announce the successor to the HTC One flagship phone.
Currently in HTC’s China website, there are 53
phones for sales, but only 2 of them carrying price tag of $150 and 21 phones are
over $500 whereas growth in China shifting to cheaper models. Local Smartphone maker
Huawei lists 8 models under $150 mark, Xiaomi, which sells its Smartphones from
$130 to $410 is eyeing to double its sales this year compared to 2013.
While HTC recalibrates, Wang said the company wouldn’t
return to its roots as a contract manufacturer supplying phones for others
though.
"We're not even considering that", she
said: The only manufacturing partnerships HTC will consider are ones where its
brand features on the phone alongside that of a partner such as a mobile
carrier.
HTC partnered with MediaTek (low cost SoC maker) to
produce low cost Smartphones and it launched HTC Desire 310 in mid range
segment.
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