How Motorola is refreshing its portfolio to make an impact, again

The Lenovo-owned smartphone-maker put its foldable smartphone series on the market with the Razr 40 and Razr 40 Ultra

Motorola had succumbed to the Chinese influx of innovative and affordable smartphones [File] | Photo Credit: Haider Ali Khan

Once a dominant name in the mobile industry, Motorola had succumbed to the Chinese influx of innovative and affordable smartphones. In 1973, the company’s engineer Martin Cooper built the first commercially ready handset, DynaTAC 8000X, that weighed more than a kilogram and was nearly a foot long. It carried a $4,000 price tag. Since then, Motorola built and sold several market leading products until the company lost its edge after the dawn of the iPhone era. And during its five-decade long existence, the company changed hands from owners in the West to the East.

Google purchased the smartphone maker in early 2010s to beef up its Android push. After draining the Chicago-headquartered company of its patents, owner Alphabet sold the Motorola to China’s Lenovo, which led to its market re-entry with the G and E series smartphones. There have been other series, but these two have remained key drivers for its growth in India. 

Most recently, the Lenovo-owned smartphone-maker put its foldable smartphone series on the market with the Razr 40 and Razr 40 Ultra. The announcement evoked memories of Motorola’s Razr V3, which was launched in 2004. At that point, the device was an industry-defining phone. But nearly twenty years on, the foldable phone segment has significantly changed. Now, Samsung and Oppo have put out their own cutting-edge foldable phones in the market for consumers looking for iPhone alternatives.

“Today, Motorola has a clean portfolio, positioning and messaging just like its clean UI. That is helping the brand to rebuild its unambiguous market standing. The decision to hive Lenovo as a smartphone brand also added to this clarity,” said Faisal Kawoosa, Founder and Chief Analyst at Techarc. Motorola is registering positive growth in terms of profitability since many quarters, he added.

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“More than 70% portfolio lies in sub $200 (around ₹16,400) which makes it very competitive for price sensitive India market, and 25% in $200-400 (around ₹16,400 - ₹32,801) making the spread across mass and mid mass segment,” said Upasana Joshi, Research Manager, Devices, IDC India.

According to IDC, Motorola had 2% share in unit shipment in CY22. However, it is a mostly online heavy brand (90%+ volumes from eTailer platform), hence needs more attention in the very important offline channel.

Foldable space

Samsung leads in foldable phones and is currently gearing up for its fifth-generation phone launch. Oppo, the challenger in the segment, is going to sell its third-generation foldable phone this year. Motorola’s entry expands the option base for buyers who may consider the brand’s legacy as an advantage.

“The foldable form factor certainly has room for new brands and Motorola can benefit from it,” Ms. Joshi said, adding premium market is heavily dominated by Apple, Samsung, and OnePlus, along with flagship offerings from China-based vendors.

Analysts note that offline presence plays a key factor in this space as consumers in this segment prefer prospecting product in a physical setting. Also, a brand’s credibility plays as an important factor in this segment.

“For foldable smartphones, customers will only prefer credible brands having strong tech credentials. In the mid-term, Motorola carving its niche somewhere between Samsung and the Chinese folks in the foldable smartphones,” Mr. Kawoosa said.

“Motorola has a good legacy and reputation in being an innovative brand. Consumers who could evaluate a Chinese brand to buy a foldable smartphone, will now go for Motorola owing to their strong credentials in being innovative and the established legacy,” he added.

“The brand’s entry into the foldable smartphone market demonstrates significant innovation. However, to stand out in a hyper-competitive smartphone market, Motorola needs to refine its go-to-market roadmap, focusing on effective market messaging as well as strong marketing strategies to regain consumer confidence amidst a sea of similar smartphone offerings,” said Prabhu Ram, Head IIG, CMR.

Consumer attention

Motorola is constantly pushing budget and mid-segment phones, but the next phase of growth is in the affordable 5G phones.

“To gain consumer’s attention, Motorola as a brand needs to have more 5G launches at low- to mid-price segment,” Ms. Joshi noted.

Today, it is not about launching a smartphone but creating an ecosystem. Samsung has been a successful example for owning an ecosystem of smart devices. Motorola has to make one for itself so that a foldable phone buyer can feel empowered to buy from its store.

“Consumers are moving towards a smart devices ecosystem; it needs to up its game on the entire smart devices. It has several devices available but it rarely talks about them. Time has come to present Motorola as a smart ecosystem provider than just a smartphone maker,” said Mr. Kawoosa.

“Compared to competition, it may not have too many models and variants to offer at each price segment, but it has a leaner portfolio,” he added.

Motorola’s legacy and credibility can take the brand to an important juncture, but it has to build an ecosystem to capitalise on its strengths. It will also have to focus on offline expansion and make the public aware about its product portfolio that gets lost online. The recent launches of the Edge series and foldable phones show that the company is looking to compete in the smartphone industry.

The market for foldable phones is expanding. According to data from Techarc research, nearly 6.35 lakh foldable phones are expected to be sold in 2023. And Motorola is entering this new and expanding segment when India is witnessing a wave of premiumisation. One more product in the mix could be good news for buyers.