Who are the potential clients for Vsmart’s huge smartphone plant?

As the habit of Vietnamese smartphone users has changed, mobile network operators in Vietnam can now cooperate with Vsmart to provide smartphones at low prices with associated service packages.

Vietnam, a smartphone market dominated by foreign brands such as Samsung, Apple and Xiaomi, for the first time has witnessed the strong rise of the Vietnamese brand Vsmart.

Who are the potential clients for Vsmart’s huge smartphone plant?



Vsmart Live is a smartphone priced at VND4 million but the device has better configuration than rivals of the same price level. It has AMOLED screen and uses fingerprint technology, though the recognition is not as good as the traditional fingerprint sensor.

However, all these are enough for the product to become a favorite.

Vsmart is not a strong brand in Vietnam. The fact that a new brand can attract customers shows changes in Vietnamese consumers’ habits.

When smartphones become a basic good n a saturated market, buyers no longer pay much attention to the brands of products, but attach more importance to the configuration and selling prices.

When smartphones become a basic good n a saturated market, buyers no longer pay much attention to the brands of products, but attach more importance to the configuration and selling prices.

 The strong rise of new brands such as Realme is a typical example.

 

This is promising for Vingroup’s new smartphone plant which has the capacity of 125 million products a year, or 10 times of total number of smartphones sold in Vietnam in 2017.

Mobile network operators are struggling to increase their revenue at a time when people use OTT (over the top) services rather than traditional calls/messaging services.

Network operators have a great advantage that retailers don’t have – the capability of selling smartphones at low prices together with attractive telecom service packages.

Instead of paying for smartphones once immediately and paying monthly for telecom services, they can pay by instalment to mobile network operators, while still can use the services daily.

Mobile network operators also get big benefits. They can sell the service packages they want and have loyal clients. With these benefits, they can sell smartphones at cost prices or even at a loss.

In order to have smartphones with strong configuration at good prices, mobile network operators will have to order products in large quantities, which is what manufacturers like Vsmart expect.

In other words, the strategy will bring benefits to three parties – customers, mobile network operators and Vsmart.

Linh Ha 

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