Growth of realme: From an Underdog to a Market Challenger
| Case Code: BSTR672 Case Length: 14 Pages Period: 2018-2023 Pub Date: 2024 Teaching Note: Available |
Price: Rs.400 Organization : realme Industry : Countries : China Themes: Brand Strategy, Brand Differentiation, Global Strategy,International Marketing |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Global Expansion and Growth
After its foray into India, realme entered another Southeast Asian Market (SEA Market), Indonesia, in October 2018, launching its realme 2 Pro model in the country through a partnership with Lazada. Within just three minutes of its debut on Lazada, realme had made 33 billion rupiah in sales. Within just a year of its launch, realme gained an 8% market share in the Indonesian smartphone market, featuring among the top five smartphone brands in the country. realme’s leaner portfolio with its aggressive online focus and value for money proposition helped it gain market share in Indonesia. By the end of 2022, realme had captured 11.8% of the market share and shipped 4.1 million smartphone units in the Indonesian market, ranked at 5th place..
Beyond Smartphones
In June 2020, realme entered the AIoT space as it launched a new product strategy, referred to as the “1+4+N” strategy. The “1” in “1+4+N” represented smartphones which would be at the top of realme’s product hierarchy, while the “4” signified four smart hubs – Smart TV, Smart Earphone, Smart Watch, and Smart Speaker, and the “N” in the strategy identified the innumerable new products realme intended to launch in the lifestyle and AIoT segment.In 2021, realme entered the AIoT 2.0 era with an advanced ‘1+5+T’ strategy to deepen its commitment to providing its consumers with an aspirational, trendsetting lifestyle that was in step with the newest technological breakthroughs
Strategies to Win Global Markets
Within a span of five years, realme became a global success as it catered to the needs of price-conscious Gen Z customers with affordable yet high quality smartphones through online channels. Low-cost and aggressive pricing, youth-focused brand positioning and an efficient e-commerce-based go-to-market strategy helped realme achieve growth in the global markets..
Challenges Ahead
Despite its phenomenal success in global markets, realme could meet with some challenges going forward. One of the biggest challenges it faced was a decline in smartphone shipments. In Q4 2022, realme witnessed a drop of 49% Y-o-Y in smartphone shipments. The drop, as observed by analysts, was for the third consecutive time in 2022. Some analysts attributed the plunge in smartphone shipments to high inflation rates, the macroeconomic crisis, global supply chain hurdles, increased import duties, inflated tax rates, and a drop in smartphone demand. Integration into the local markets was critical for growth in foreign markets, noted experts. Building trust among the youth was required to boost sales..
Exhibits
Exhibit I:Top 24 Kantar BrandZ Chinese Global Brand Builders 2023
Exhibit II: Growth of realme in terms of Quarterly Shipments and Ranks
(From Q3 2018 to Q2 2021)
Exhibit III: realme: World’s Fastest Growing Smartphone Brand
Exhibit IV: Four Smart Hubs of “1+4+N” Strategy of realme
Exhibit V: Realme Product Line*
Exhibit VI: Global Smartphone Shipments by Market Share and Shipments
(From Q3 2021 to Q2 2023)
Exhibit VII: Worldwide Smartphone Shipments, Q1 2020 to Q1 2023
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