Retailers push mid-range mobiles to counter crisis

ALKESH SHARMA / Emirates Business

In a bid to tackle the crisis situation hovering over the Middle East’s mobile phone industry, vendors have strategically shifted their focus to low to mid-range devices. To beat the market plummet, they are offering consumers mid-range mobiles, falling in the price bracket of AED500 to AED800.
Market reports say that most of the consumers now prefer handsets that are priced as low as only AED600. The weakened consumer sentiments have also led to a sharp plunge in the shipment of mobile phones in the Middle East region during the first quarter of 2016.
According to a latest report released by International Data Corporation (IDC), many leading mobile companies are opting for shipping mainly low and mid-segment mobile phones to this region.
Saad Elkhadem, a research analyst for mobile phones at IDC Middle East, Africa, and Turkey, said, “Customers are showing reluctance to spend more on their mobile devices because of the challenging economic atmosphere. Vendors are also pushing their mid-range devices.” While citing an example of this market trend prevailing in the industry, Elkhadem said that the Samsung J series is a key example of this new focus.
“Samsung J series is mostly priced under $200 (around AED700) and it is already responsible for a large portion, nearly a third of the Samsung’s Middle East shipments,” he pointed out. In its report, IDC stated that this strategy of shifting attention principally on low and mid-range mobile phones is not something new in the market. Huawei and Lenovo are following this practice for a long time as low to mid-range phones, priced in the range of $200 to $300 (nearly AED700 to AED1050), constituted between 80 to 90 percent of their total Middle East shipments in the first quarter of this year.
Akshay Makhani, a technology researcher with a Dubai-based consultancy firm, told Emirates Business, “Mobile phone industry is certainly going through a rough patch. There has been a dip in the demand of expensive handsets in the GCC region in the last couple of months, leading to the cancelling of many shipments of high-range sets. We are expecting the same market sentiments to continue in the coming months.”
“Moreover, there has been a slight dip in the number of tourists coming from Europe, especially from France and Belgium, to the Middle East. They used to buys expensive smart-phones and cut in their number has also affected the market,” pointed out Makhani.
Gauging the market trends, Apple has also made an attempt to capture the mid-range market of mobile phones by launching iPhone SE. However, market analysts maintain that it is too early to evaluate the outcome of this attempt of the US IT-giant.