OnePlus: A Chinese Tech Start-up Aiming to Disrupt the Global Smartphone Market
| Case Code: LDEN107 Case Length: 20 Pages Period: 2013-2016 Pub Date: 2016 Teaching Note: Available |
Price: Rs.400 Organization : OnePlus Industry: Smartphone Countries : China; Global Themes: Entrepreneurship, Business Model, Startup Management, Competitive Strategy |
Abstract Case Intro 1 Case Intro 2 Excerpts
The Beginning
OnePlus was co-founded by Lau and Pei in December 2013. Previously, they both worked at OPPO. While Lau was the Vice President of the company, Pei was the head of OPPO’s Global Marketing and e-Commerce division. In August 2013, Lau and Pei along with some of their colleagues from OPPO were at a café, when they noticed that they were all using iPhones even though they were working for a company making Android phones. The reasons each of them gave for not using an Android Phone, was bad build quality, want of a good design, lack of intuitive software, etc. According to the group, Apple was the only company that cared about its products and that there was no clear second-best product focused smartphone manufacturer in the global smartphone market. They felt that manufacturers of Android based smartphones were just concerned about market share as opposed to making the best products.
That was when Lau was besotted with the idea of creating a high-end smartphone with a good build quality and attention to detail at an affordable price which he felt was sorely missing in the market. He realized that consumers often settled for phones that were affordable but not necessarily fulfilled all their expectations. He wanted to put as much care into the product as Apple does and never compete on price. Moreover, China was one of the largest consumer markets in the world with a population of 1.3 billion as of 2008. It was home to 675 million unique mobile users. In 2015, smartphone penetration rate in China was 38.6%. Between 1979 and 2014, China’s real gross domestic product (GDP) grew at an average annual rate of nearly 10%. The growing size and purchasing power of China’s middle class presented an enormous opportunity for OnePlus to sell its products in the country...
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