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Inside iQOO's decision to announce iQOO 3 price cut, product and software strategy

iQOO made it debut in India with the launch of iQOO 3 in February. Within a month, the company saw sales curtailed due to lockdown but didn't shy away from making a price revision. Here is why.

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India’s smartphone market is up for a significant challenge during the second quarter of this year. After lockdown curtailed sales during the month of April, May does not seem to look promising either. According to Counterpoint Research, India’s smartphone market saw modest growth of 4 percent during the first quarter. The report highlighted how the market declined 19 percent annually in March and dragged the entire quarter to modest growth. While leaders like Xiaomi, Vivo and Samsung will weather this situation, the road ahead is tough for new entrants. India’s smartphone market has seen a number of new entrants over the years, who have gone ahead to displace incumbent players. One such new entrant in the Indian smartphone market is iQOO. Also Read - iQOO 3 price in India cut by Rs 4,000: Check new prices, full specifications, sale details

iQOO entered the smartphone market as a sub-brand of Chinese smartphone maker Vivo. The idea was a premium brand that focused on niche categories such as gaming. While the brand operates as a sub-brand in China even today, it took an independent route when it entered India early this year. Like Oppo, Realme, Vivo and OnePlus, iQOO is one of the many smartphone brands of BBK Electronics, operating in India. As an independent brand, iQOO gets to choose its own product lineup, user interface and marketing strategy. It also gets to compete with four other brands from its parent company. When it debuted iQOO 3 in India in late February, Gagan Arora, Director – Marketing, iQOO India, stressed that it is a brand focusing on premium tier. Also Read - iQOO Neo 3 with 144Hz display, Snapdragon 865 SoC launched: Check Price, full specifications

With COVID-19 outbreak disrupting the market, Arora insists the company is rooted in that philosophy. It has launched iQOO 3 in two different variants: a 4G version and a 5G version. The difference between the two devices has itself become a matter of contention in the industry. It even forced tech writers like me to scramble for answers. With a window of just a month to sell iQOO 3, the company is finding itself in an unknown challenge. Gagan Arora, who is the former CMO of Foodpanda, told me the company is prepared for the battle. He insisted that the health of iQOO employees remains a key focus. However, the company has rolled out a number of initiatives for those who trusted the brand when it commenced sales on March 4, 2020. During a telephonic call, Arora explained the reason behind the price cut, product strategy and how it is gearing up for This interview has been lightly edited and condensed for clarity. Also Read - iQOO 3 Review: The heavyweight challenger with 5G

Gagan Arora, Director – Marketing, iQOO India

Why did you announce the price cut amidst lockdown?

We did research to understand how a consumer makes product decisions. Our study showed that a user takes 10 to 15 days to decide before they buy a premium category smartphone. Consumers visit websites like BGR, or some other website to check the reviews and understand pros and cons for the smartphone of their choice. For any phone, which is above Rs 30,000, consumers take between 10 to 15 days to decide. If delivery of non essential goods starts by early May on e-commerce platforms, we thought this price cut would help them make better decisions. People were asking for a while now what we are going to do post lockdown and what would be our strategy and our strategy is to help consumers who were looking at the right price before buying iQOO 3.

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Do you see others following in your footsteps and announce price cuts?

To be honest, we took this action for our consumers directly. If you see in any case, at this price point, even before the price cut, the iQOO 3 was the best offering in terms of Snapdragon 865, LPDDR5 and UFS 3.1 storage. If you see all of these things, in any case, we were numero uno. And I think we have made ourselves much stronger in terms of our proposition. And not only that, but we are also taking strong actions on the product strategy as well. At iQOO, we have formally decided and I’m telling you also that you know, two major upgrades and security patches for three years. So, iQOO 3 is not only a strong product in terms but also price in terms of product experience.

Are you saying that iQOO 3 will get Android 11 and Android 12?

I want to say that we will be one of the earliest to bring Android 11 on iQOO 3. So, iQOO 3 will be one of the few smartphones to get the newest release of Android. The release of this update depends on when Google makes Android 11 update official. We will definitely be among the first few brands to release the update. With the update, we are also promising that iQOO 3 will receive Android security updates till February 2023. During the lockdown period, we have also extended the warranty by 90 days. So people who have bought the iQOO 3 in March, they will get a 90 day extension of warranty. We have also extended the replacement period by 10 days for those devices coming under the lockdown period. We see this as part of our product strategy experience, which is important once the consumer buys our phone.

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How was the response for iQOO 3 during the first month when it went on sale?

The response on the consumer side has been tremendous. On Flipkart, we are seeing a median rating of 4.5 for all the variants. The share of 5G phones has also doubled to 30 percent. For the product strategy, we planned that 15 percent of the sales will come from 5G devices. However, that number has doubled to 30 percent. So consumers are not just loving us, but they’re also accepting the new technology. We understand that 5G is not yet available in India but out consumers want to have the latest specs with them. For this very reason, we are offering two different products catering to 4G and 5G segments.

Qualcomm says every Snapdragon 865 device is also 5G compatible. So, can you put an end to confusion around 4G and 5G variants of iQOO 3?

We have disabled the 5G bands in two variants so that we can offer SD865 experience to our users at an even better price. Both of these variants would work in 4G only. Our top variant is 5G enabled which is made keeping in mind the future-ready users and technology enthusiasts. That’s the technical answer but on the consumer side, I can tell you the purpose behind this decision. There is a large set of consumers who want a 4G smartphone and don’t want to embrace new cellular technology immediately. We accounted for our 5G consumer demand and also accompanied those who wanted a 4G phone.

How do you see the demand once the lockdown gets lifted?

I think it would be slightly premature to tell anything right now because we are still in lockdown. We don’t know whether it’s going to open next month or will it open for an entire country or some part of the country. Once we have this kind of clarity, I can offer you a consolidated outlook for the brand. In this situation, the safety of employees, consumers and partners remains the most important element for us.

Will we see a different product strategy post lockdown from iQOO?

When we launched, our focus for the first six months was very clear. We want to establish ourselves as a premium category smartphone brand. During this lockdown period also, we want to make sure that consumers consider us as an alternative. There’s one thing second thing is that we were focusing on the performance aspect. At the time of the launch, we were focusing on performance aspects. Now, we are tying the flagship performance with product experience. From here on, the focus is on upgrades, updates, product guarantee and warranty policy. The next phase would be to add more touch points for service. Right now, we have more than 15,000 service touch points and there is a scope to go even further. We are still in the first phase of establishing iQOO as a premium smartphone brand and once that phase is over, we will have more brand initiatives.

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Are you planning to bring 5G phones based on the Snapdragon 765 platform to India?

I would like to clarify that 5G alone is not our pillar. If you see iQOO 3, it has two unique advantages in the form of monster touch buttons and 55W fast charging. In order to become a leading player in the premium smartphone segment, we must have multiple aspects that shine in our product. So, 5G is part of the strategy but it is not the only key thing deciding our strategy. I cannot answer whether we will launch a Snapdragon 765-based smartphone right now. For now, the focus is to make sure that iQOO 3 reaches as many consumers as possible.

Will iQOO remain a smartphone only brand for the rest of this year in India?

We have a very clear strategy on this. We will enter a product category only if we can redefine the product experience. I’m not going to enter that category. Even within the smartphone segment, I’m not going to touch a price point where iQOO cannot bring a new experience. So, we don’t see ourselves entering the super budget or mid-range smartphone segment.

What role do you see iQOO UI will play in your product strategy?

Hardware is only the precursor to reaching a consumer and specifications are measurable only at the time of sale. With respect to competition also, hardware remains the same while UI can help differentiate yourself in the market. I would say touch, look and feel of the UI is part of a continuous improvement cycle. We are taking constant feedback from our consumers and improving on those features. Longevity of the product is one of the strengths of iQOO product strategy. By offering regular software updates, we see an opportunity to extend the shelf life of our product.

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  • Published Date: April 29, 2020 6:28 PM IST
  • Updated Date: April 30, 2020 12:31 PM IST