Local Smartphones Struggle in its Home Country

By: Ni Kadek Virgina Nanda Wedasari (Student of International Marketing Program)

Technology is shaping a new custom for people in the society. It has affected the way people live; one of the most advanced technologies is the Internet. Hence, smartphone has become a necessity for communication, as well as leisure activities for the Indonesian market. The growth of Internet usage affected smartphone industry significantly. With the popularity of social media in the market, the usage of smartphone is adopted widely. Indonesia has became the third-largest smartphone market in the Asia-Pacific region (after China and India) with expected number to rise from 55 million in 2015 to 74 million in 2017 (eMarketer.com, 2016). With the rising expected numbers, there remains ample room for further growth in the industry. Indonesian government took the opportunity for economic growth of the country.

As one of the emerging market for smartphone in SEA (Southeast Asia), the competition environment for smartphone industry in Indonesia is constantly changing; therefore, smartphone vendors are competing fiercely to gain market leadership. Smartphones vendors in Indonesian market adopt product innovation and aggressive marketing activities, to continue strive in the fierce competition environment.

In the midst of foreign smartphone brand competition in Indonesia were local brands, such as ADVAN, Evercross, Smartfren, etc., they are struggling to compete with foreign brands. Local vendors, struggling to compete on such a scale have been coming up with alternatives such as launching their in-house applications, bringing competitively priced smartphones with similar specs (to the China-based ones) and more focus on lower-tier cities and rural parts of the country (IDC , 2017).

Local smartphone vendor is losing market share, because of the global smartphone brand’s brand equity. Global brands also had more resources for their business functions. In the coming years, local brands had to put more effort into research and product development, so that, the product quality offered have the same value of global brand smartphones.

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